Roquan, a single taxpayer, is an attorney and practices as a sole proprietor. This year, Roquan had net business income of $90,000 from his law practice (net of the associated for AGI self-employment tax deduction). Assume that Roquan pays $40,000 in wages to his employees, has $10,000 of property (unadjusted basis of equipment he purchased last year), and has no capital gains or qualified dividends. His taxable income before the deduction for qualified business income is $100,000. Required:
Calculate Roquan’s deduction for qualified business income. Assume the same facts as earlier, except Roquan’s taxable income before the deduction for qualified business income is $300,000.
1. Calculate Roquan’s deduction for qualified business income.
2. Assume the same facts as earlier, except Roquan’s taxable income before the deduction for qualified business income is $300,000.

1) $18,000

2) $0

Explanation:

1) The wage based limits in business applies only to taxpayers with taxable income in excess of $157,500 or excess of $315,000, if it is a joint return.

Now, in this case, Roquan's taxable income which is $100,000 is less than the wage limits of $157,500 earlier stated. This implies that it doesn't qualify for wage-based limits.

Therefore, from business practices, Roquan will likely deduct 20% of the net $90,000 which is $18,000 to serve as deduction for qualified business income.

2) We are told that Roquan's taxable income before the deduction for qualified business income is now $300,000. What this implies is that his law practice would be judged to be a trade business and he would therefore not be eligible for deduction of the qualified business income.

Thus, it's $0.

1   all nations face the problem of scarcity because there are limited resources and unlimited wants. nations do not have enough factors of production to produce everything that their population wants. entrepreneurial resources initiate businesses to make new goods and services; labor resources produce goods and services.

2 there are four factors of production: natural resources, labor resources, capital resources, and entrepreneurial resources. natural resources are raw materials from nature that are used to produce goods. trees, water, and grains are natural resources. some natural resources, such as wheat and cattle, are renewable

3 wants

things that you do not need to have in order to survive, but would like to have

needs

things that you must have in order to survive

goods

physical products

services

tasks that a business perform for customers

resources

items that people can use to make or obtain what they need or want

determine

to settle or decide by choice of alternatives or possiblities

4 i really dont know

answer; windows embedded;