AP/ Joyce M. Rosenberg/ August 13, 2018
NEW YORK (AP) â€” Small business owners have gotten more information about a new tax break many will get, with the IRS issuing proposed regulations that explain the deduction for qualified business income and which company owners can claim it.
Some of the new details include how to handle a spouseâ€™s income, whether side businesses qualify, and the rules for losses in one or more businesses.
Under the new tax law, many owners can deduct 20 percent of their qualified business income, up to a ceiling thatâ€™s equal to 20 percent of their taxable income minus capital gains. Qualified business income is earned from a company operated as a sole proprietorship, partnership or S corporation. These businesses are known as pass-throughs because the company income â€śpasses throughâ€ť to ownersâ€™ 1040 forms, where it is reported to the IRS.
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