TOTAL now includes the Qualified Business Income (QBI) deduction available to pass-through entities. The new provision introduced in the recent tax reform allows a deduction of up to 20% of qualified business income from sole proprietorships, limited liability companies (LLCs), S corporations, partnerships, real estate investments, trusts, and estates. 

At the most basic level, the deduction amounts to 20% of the taxpayer's qualified business income. The full calculation surrounding deduction is anything but basic, which may reduce or eliminate the potential deduction.  Limits to the deduction include a cap of 20% of the household's taxable income, phaseouts for high-income taxpayers engaged in a specified service trade or business, and additional limits based on W-2 wages and qualified property. 

The tax section of TOTAL's planning data offers a new item, Qualified Business Income Deduction, to capture the amount of deduction available to clients. TOTAL will not attempt to calculate the deduction amount due to the complex rules surrounding the deduction.  Instead, TOTAL will solely capture the deduction amount for tax purposes, reducing the client's federal taxable income.