Section 199A Actual Tax Returns Comparison

By Jason Watson, CPA
Posted Wednesday, October 20, 2021

The computation can be maddening as we’ve demonstrated in the previous pages. So… we created fictitious tax returns for Fred Flintstone operating an S corporation (he bought Slate Rock and Gravel from Mr. Slate). You can see side by side the differences between 2017 and 2018, using the new tax brackets, the new standard deduction and the Qualified Business Income Deduction (QBID) along with Section 199A.

Our $25,000-a-year expensive tax software (UltraTax aka UltraPain) does a wonderful job showing the worksheet computations of the Section 199A deduction, line by line.

Here is a table for reference-

Filing Status	TP Income	SP Income	Biz Inc	SSTB	199A Deduction
single	30,000		70,000		14,000
single	60,000		140,000		28,000
single	60,000		140,000	Yes	10,920
married	60,000		140,000		28,000
married	60,000		140,000	Yes	28,000
married	60,000	150,000	140,000		28,000
married	60,000	150,000	140,000	Yes	24,920
married	40,000	150,000	160,000		30,680
married	40,000	150,000	160,000	Yes	27,305

SSTB refers to specified service trade or business. The following link shows copies of the 2017 tax returns plus the 2018 tax projection worksheets (TPW as we call it) for our buddy Fred-

wcginc.com/8313

Caution: Our software is using a strict interpretation of the tax code. This is where the accountant has to be the accountant, and prepare the tax return.