In a notice from the IRS and acting IRS Commissioner, David Kautter, the much-anticipated additional guidance on the 20% qualified business income (QBI) deduction for pass-through entities (Section 199A) is expected to be released by the end of July. An IRS spokesperson said, “The goal of the guidance is to get things out that are complete. But, it will not cover every question that taxpayers have.”
The new 20 percent pass-through deduction, made law with the Tax Cuts and Jobs Act (TCJA), is limited by unclear factors such as business activities and industry, wages paid by the business and property values, which has prompted the request for further guidance from business owners and CPAs.
As for what to expect in July, Kautter has said they would like to release the guidance in “fairly good shape” to allow for further public comment and input, rather than just internal discussion, and that he believes a “better product” will likely be created because of it.
Check back for updates on this as the guidance is released. For questions about tax reform, contact your account representative at 888-556-0123.