Qualified Business Income (QBI) Deduction
Definition
A US deduction under Section 199A allowing eligible owners of pass-through businesses to deduct a portion of their qualified business income, subject to income thresholds and limitations.
Related Terms in US Tax
Standard Deduction (US)
A fixed amount US taxpayers can subtract from income instead of itemising deductions, varying by filing status and adjusted annually. Taxpayers choose whichever is larger — the standard deduction or itemised deductions.
Itemized Deductions
Specific US deductions — such as mortgage interest, state and local taxes within limits, and charitable gifts — claimed in place of the standard deduction when they total more, reducing taxable income.
Adjusted Gross Income (AGI)
A US taxpayer's total gross income less specific above-the-line adjustments. AGI is the starting point for many deductions, credits and phase-out thresholds.
Taxable Income
The amount of income on which tax is actually calculated, after subtracting deductions from gross or adjusted gross income. Tax rates and brackets apply to this figure, not to total income.
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