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QBI Deduction W-2 Wage and Property Limit Calculator, 2026

What does this come to under the current IRS rules?

Section 199A deduction with the wage and unadjusted basis limit, the 2026 threshold phase-in, the SSTB reduction and the taxable income cap.

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Your figures
Example figuresIllustrative only. Type over them with your own.
QBI deduction for this business
$39,800
Lesser of the limited amount and the taxable income cap, not below the $400 minimum when it applies
20% of QBI (after SSTB reduction)
$50,000
Wage and property limit
$30,000
Greater of 50% of W-2 wages, or 25% of wages + 2.5% of UBIA
Drawn to one scale
QBI deduction for this business$39,800
20% of QBI (after SSTB reduction)$50,000
Wage and property limit$30,000
Taxable income cap (20% of income less net capital gain)$48,000
2026 threshold$201,750
All results
MeasureResult
QBI deduction for this business$39,800
20% of QBI (after SSTB reduction)$50,000
Wage and property limit
Greater of 50% of W-2 wages, or 25% of wages + 2.5% of UBIA
$30,000
Phase-in share of the limit
Share of the range between threshold and top of range
51.00%
Taxable income cap (20% of income less net capital gain)$48,000
2026 threshold$201,750
How this was worked out
Work shownrecomputed as you type
Tentative = 20% x QBI
Wage and property limit = greater of 50% x W-2 wages, or 25% x W-2 wages + 2.5% x UBIA
Phase-in ratio = (taxable income - threshold) / range, capped at 1 (range $75,000, or $150,000 joint)
Deduction = tentative - (tentative - limit) x ratio when tentative exceeds the limit
Final = min(deduction, 20% x (taxable income - net capital gain))
SSTB: QBI, wages and UBIA are first multiplied by (1 - ratio)
Minimum (2026): final is at least $400 when you materially participate and QBI is at least $1,000

Illustrative arithmetic on the figures you enter. Check the result against your firm's methodology before relying on it.

The formulas

  • Tentative = 20% x QBI
  • Wage and property limit = greater of 50% x W-2 wages, or 25% x W-2 wages + 2.5% x UBIA
  • Phase-in ratio = (taxable income - threshold) / range, capped at 1 (range $75,000, or $150,000 joint)
  • Deduction = tentative - (tentative - limit) x ratio when tentative exceeds the limit
  • Final = min(deduction, 20% x (taxable income - net capital gain))
  • SSTB: QBI, wages and UBIA are first multiplied by (1 - ratio)
  • Minimum (2026): final is at least $400 when you materially participate and QBI is at least $1,000

How it works

Below the threshold the wage and property limit does not apply. Between the threshold and the top of the range, the amount by which 20 percent of QBI exceeds the limit is reduced in proportion to how far taxable income is into the range. Above the range the full limit applies. For 2026 the thresholds are $201,750 ($403,500 joint) and the range is $75,000 ($150,000 joint).

For a specified service trade or business, the applicable percentage falls from 100 percent to zero across the same range and scales QBI, wages and property. For taxable years beginning after 2025, section 199A(i) sets a $400 minimum deduction for a taxpayer with at least $1,000 of QBI from businesses in which the taxpayer materially participates under section 469(h). This tool handles one business. With several businesses, compute each and add them, then apply the overall cap and the $1,000 test to the totals. REIT dividends, publicly traded partnership income and loss carryovers are not modeled.

Illustrative figures only. Check the result against your firm's methodology before relying on it.

Common questions

What are the 2026 thresholds?

Rev. Proc. 2025-32 sets $201,750 for most filers, $403,500 for joint returns and $201,775 for married filing separately.

What is UBIA?

Unadjusted basis immediately after acquisition of qualified property, as the statute defines it. Enter the total for this business.

Why is my deduction below 20 percent of QBI?

Either the wage and property limit binds, the SSTB percentage reduces it, or taxable income less net capital gain caps it.

Sources

Runs in your browser. The figures you type are not sent to CORAA or stored. Check the result against your firm's methodology before relying on it.

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