Question 12 Georgina Rockwell, an unmarried person, is a partner in a law firm. She receives a guaranteed payment of $200,000 and a pass-through profit share of $100,000. Describe the correct tax treatment regarding the Qualified Business Income Deduction is Georgina's case. She is entitled to a Qualified Business Income Deduction equal to 20% of Qualified Business Income She is entled to a Qualified Business Income Deduction equal to 20% of Modified Taxable Income She is entitled to a reduced Qualified Business Income Deduction (below the lesser of 20% of Qualified Business Income or 20% of modified taxable income) She is not entitled to a Qualified Business Income Deduction

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Chapter1: Financial Statements And Business Decisions
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Question 12
Georgina Rockwell, an unmarried person, is a partner in a law firm. She receives a
guaranteed payment of $200,000 and a pass-through profit share of $100,000.
Describe the correct tax treatment regarding the Qualified Business Income
Deduction is Georgina's case.
She is entitled to a Qualified Business Income Deduction equal to 20% of
Qualified Business Income
She is entled to a Qualified Business Income Deduction equal to 20% of
Modified Taxable Income
She is entitled to a reduced Qualified Business Income Deduction (below the
lesser of 20% of Qualified Business Income or 20% of modified taxable income)
She is not entitled to a Qualified Business Income Deduction
Question 13
Rupert Davis, an unmarried person, is a part owner of an S corporation that operates
multiple food trucks. He receives compensation of $30,000 and a pass-through
profit share of $80,000. He also has significant income outside of the business. His
modified taxable income (before the QBI deduction) is $187,000.
Rupert's share of 50% of W-2 wages is $10,000 and his share of the unadjusted basis
of tangible property used in the business is $80,000.
Describe the çorrect tax treatment regarding the Qualified Business Income
Deduction is Rupert's case.
O He is entitled to a Qualified Business Income Deduction equal to 20% of
Qualified Business Income
He is entitled to a Qualified Business Income Deduction equal to 20% of
Modified Taxable Income
He is entitled to a reduced Qualified Business Income Deduction (below the
lesser of 20% of Qualified Business Income or 20% of modified taxable income)
He is not entitled to a Qualified Business Income Deduction
Transcribed Image Text:Question 12 Georgina Rockwell, an unmarried person, is a partner in a law firm. She receives a guaranteed payment of $200,000 and a pass-through profit share of $100,000. Describe the correct tax treatment regarding the Qualified Business Income Deduction is Georgina's case. She is entitled to a Qualified Business Income Deduction equal to 20% of Qualified Business Income She is entled to a Qualified Business Income Deduction equal to 20% of Modified Taxable Income She is entitled to a reduced Qualified Business Income Deduction (below the lesser of 20% of Qualified Business Income or 20% of modified taxable income) She is not entitled to a Qualified Business Income Deduction Question 13 Rupert Davis, an unmarried person, is a part owner of an S corporation that operates multiple food trucks. He receives compensation of $30,000 and a pass-through profit share of $80,000. He also has significant income outside of the business. His modified taxable income (before the QBI deduction) is $187,000. Rupert's share of 50% of W-2 wages is $10,000 and his share of the unadjusted basis of tangible property used in the business is $80,000. Describe the çorrect tax treatment regarding the Qualified Business Income Deduction is Rupert's case. O He is entitled to a Qualified Business Income Deduction equal to 20% of Qualified Business Income He is entitled to a Qualified Business Income Deduction equal to 20% of Modified Taxable Income He is entitled to a reduced Qualified Business Income Deduction (below the lesser of 20% of Qualified Business Income or 20% of modified taxable income) He is not entitled to a Qualified Business Income Deduction
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