QBI Forms 8995 and 8995A: Interpreting Evolving Guidance on SSTBs and the 20 Percent Deduction

Section 199A provides a 20 percent deduction for qualified business income (QBI). Form 8995, Qualified Business Income Simplified Calculation, and Form 8995A, Qualified Business Income, provide the IRS with details of the calculation of the 20 percent deduction under 199A.

The latter Form, 8995A, is six pages and includes four parts and four schedules that walk practitioners through the aggregation of business operations (Schedule B and Part 1), loss netting and carryforward (Schedule C), determining your QBI deduction (Part IV), calculating the phase-in reduction (Part III), and other calculations.

There are steps tax preparers can take to maximize the QBI deduction. These include aggregating businesses for QBI--this election is irrevocable and requires careful consideration. Real estate can qualify for the QBI deduction if it is part of a trade or business. There is a safe harbor to make this determination. Special de minimis rules allow businesses with less than $25 million in gross receipts to avoid the SSTB classification if less than 10 percent of their receipts are from personal services. Understanding how to maximize the 20 percent deduction is critical for practitioners working with businesses.

Listen as our expert panel explains completing Forms 8995 and 8995A, considerations for maximizing the 20 percent QBI deduction, and the latest developments under 199A.

1. QBI: an overview
2. Form 8995
3. Form 8995A
4. Review of the final regulations
5. Maximizing the QBI deduction
   1. Aggregation
   2. De minimis calculations
   3. Real estate safe harbor
   4. Other considerations

The panel will review these and other vital issues:

• The specifics of completing Forms 8995 and 8995A
• Important considerations when aggregating real estate
• How to qualify for the real estate safe harbor
• Determining what is and is not an SSTB

Learning Objectives

After completing this course, you will be able to:

• Identify taxpayers who are eligible for the QBI deduction
• Ascertain whether a business meets the de minimis SSTB threshold
• Determine whether a real estate business meets the safe harbor
• Decide whether the 8995 or 8995A is the appropriate form

• Field of Study: Taxes
• Level of Knowledge: Intermediate
• Advance Preparation: None
• Teaching Method: Seminar/Lecture
• Delivery Method: Group-Internet (via computer)
• Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
• Prerequisite: Three years+ business or public firm experience preparing complex tax forms and schedules, supervising other preparers or accountants. Specific knowledge and understanding of pass-through taxation, including taxation of partnerships, S corporations and sole proprietorships, qualified business income, net operating losses and loss limitations; familiarity with net operating loss carry-backs, carry-forwards and carried interests.

Strafford Publications, Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of Accountancy have final authority on the acceptance of individual courses for CPE Credits. Complaints regarding registered sponsons may be submitted to NASBA through its website: www.nasbaregistry.org.

IRS Approved Provider

Strafford is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).