199A phase-out planning
Law firms, accounting firms, consulting firms, and most professional services are SSTBs. The 20% QBI deduction fully phases out above the upper income thresholds, making income deferral and retirement plan contributions more valuable.
Owner draws vs. guaranteed payments
Partnership structures use guaranteed payments (taxable as ordinary income) and regular distributions (capital account reductions). Mismatched compensation agreements create tax inefficiency across the partner group.
Cash balance plans
High-income partners in small professional firms can contribute substantially to layered 401(k) + profit sharing + cash balance plans. The math often justifies the actuarial administration costs.
Common questions
- Is the QBI deduction really lost above the threshold for our firm?
- For SSTBs, yes, it fully phases out. Non-SSTB professionals (architects, engineers) keep the deduction with W-2 and UBIA limitations applied.
Related
Corporation & Partnership Tax Returns
Forms 1120, 1120-S, and 1065 preparation for corporations, S-corps, and partnerships, plus owner K-1s, shareholder basis tracking, and multi-state filings.
Business Tax Planning
S-corp reasonable salary analysis, entity elections, retirement plan structuring, and Section 179 and bonus depreciation planning for small business owners.
Small Business Payroll
Quarterly and annual payroll filings: Forms 940, 941, UCT-6, W-2, and 1099. We calculate, file, and make the tax deposits so owners can focus on growth.