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QBI Rental Deduction Calculator

Section 199A allows a 20% deduction on Qualified Business Income from pass-through entities, including rentals that qualify. Safe harbor: 250+ hours/year of rental services. This calculator applies phaseout rules.

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$
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QBI deduction

$7,000

Tax savings

$1,680

Effective deduction %

20.0%

How the math works

$35K QBI, joint filer at $180K taxable: below threshold, full 20% deduction = $7,000. At 24% marginal: $1,680 tax savings.

Document 250+ hours of services (management, leasing, maintenance) to qualify under safe harbor. Log contemporaneously — IRS scrutiny on rental QBI is high.

How to Use

  1. Enter rental net income and taxable income.
  2. Confirm safe harbor or QBI-qualifying activity.
  3. See 199A deduction and phaseout impact.

Frequently Asked Questions

Safe harbor?

Rev Proc 2019-38. Either 250+ hours of rental services during year (by owner, employee, or contractor) OR treating rentals as 'trade or business' under general §162 test. Document hours carefully.

Phaseout?

Single: phased between $191,950-$241,950 taxable income in 2026. Joint: $383,900-$483,900. Above phaseout: QBI deduction limited by wages paid + depreciable property basis.

SSTBs excluded?

Specified Service Trades or Businesses (consulting, health, accounting, etc.) have extra limits. Rental real estate is NOT an SSTB — full QBI available if qualifying.

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