What is my QBI deduction?
Type your filing status, qualified business income and taxable income. The QBI deduction calculator works through the 2026 Form 8995 and shows your deduction.
- QBI deduction
- $12,000.00
With $60,000.00 of QBI and $80,000.00 of taxable income, the 2026 QBI deduction is $12,000.00.
- QBI component
- $12,000.00
- REIT and PTP component
- $0.00
- Income limit
- $16,000.00
- Deduction before the minimum
- $12,000.00
- 2026 minimum deduction
- $400.00
- Taxable income after the deduction
- $68,000.00
- QBI loss to carry to 2027
- $0.00
- REIT and PTP loss to carry to 2027
- $0.00
- 2026 Form 8995 threshold
- $201,750.00
QBI deduction: $12,000.00. With $60,000.00 of QBI and $80,000.00 of taxable income, the 2026 QBI deduction is $12,000.00.
QBI deduction by qualified business income
The results are estimates for information only. They are not financial, tax, or legal advice. Check the numbers with your lender or a qualified professional before you decide. Terms of use
How to calculate
Works out the 2026 qualified business income (QBI) deduction on Form 8995: 20% of QBI and of REIT and PTP income, limited to 20% of taxable income less net capital gain, with the new $400 minimum.
Example with the default inputs (Filing status Single, Qualified business income $60,000.00, Taxable income before the QBI deduction $80,000.00): With $60,000.00 of QBI and $80,000.00 of taxable income, the 2026 QBI deduction is $12,000.00.
Method: Line 4 = QBI − QBI loss carryforward; QBI component = 20% × line 4 when above $0. Line 8 = REIT dividends and PTP income − their loss carryforward; REIT component = 20% × line 8 when above $0. Income limit = 20% × (taxable income before the deduction − net capital gain), not below $0. Line 15 = the smaller of the two components added and the income limit. 2026: deduction = the greater of line 15 and $400 when QBI from businesses you materially participate in is at least $1,000. Only for taxable income at or below the 2026 threshold ($201,750; $403,500 joint; $201,775 married filing separately).
- Tax year 2026 (IRS Rev. Proc. 2025-32), Form 8995 only: taxable income before the deduction at or below the threshold, and not a patron of an agricultural or horticultural cooperative.
- QBI is already net of the deductions that belong to the business (half of self-employment tax, self-employed health insurance and retirement contributions).
- The $400 minimum uses the QBI from businesses you materially participate in; with that box empty it uses the whole QBI on line 2, before last year’s loss carryforward.
- An estimate, not tax advice.
Worked examples
Each example is checked against the calculator on every build.
- Filing status Single, Qualified business income $60,000.00, Taxable income before the QBI deduction $80,000.00 gives QBI component $12,000.00, Income limit $16,000.00, Deduction before the minimum $12,000.00, 2026 minimum deduction $400.00, QBI deduction $12,000.00, Taxable income after the deduction $68,000.00.Source: IRS Instructions for Form 8995 (2025): lines 1 to 17, https://www.irs.gov/instructions/i8995; IRC 199A(a), (b)(1) and (i), https://www.law.cornell.edu/uscode/text/26/199A; IRS Rev. Proc. 2025-32 (IRB 2025-45), section 4.26 (2026 threshold $201,750; $403,500 joint; $201,775 married filing separately) and section 2.12 ($400 minimum, $1,000 of QBI), https://www.irs.gov/irb/2025-45_IRB
- Filing status Married filing jointly, Qualified business income $150,000.00, Taxable income before the QBI deduction $120,000.00, Net capital gain and qualified dividends (optional) $20,000.00 gives QBI component $30,000.00, Income limit $20,000.00, QBI deduction $20,000.00, Taxable income after the deduction $100,000.00, 2026 Form 8995 threshold $403,500.00.Source: IRS Instructions for Form 8995 (2025): lines 1 to 17, https://www.irs.gov/instructions/i8995; IRC 199A(a), (b)(1) and (i), https://www.law.cornell.edu/uscode/text/26/199A (line 15 is the smaller of lines 10 and 14); IRS Rev. Proc. 2025-32 (IRB 2025-45), section 4.26 (2026 threshold $201,750; $403,500 joint; $201,775 married filing separately) and section 2.12 ($400 minimum, $1,000 of QBI), https://www.irs.gov/irb/2025-45_IRB
- Filing status Single, Qualified business income $1,500.00, Taxable income before the QBI deduction $50,000.00 gives QBI component $300.00, Deduction before the minimum $300.00, 2026 minimum deduction $400.00, QBI deduction $400.00, Taxable income after the deduction $49,600.00.Source: IRC 199A(i) (the greater of the deduction and $400 for at least $1,000 of active QBI); IRS Rev. Proc. 2025-32 (IRB 2025-45), section 4.26 (2026 threshold $201,750; $403,500 joint; $201,775 married filing separately) and section 2.12 ($400 minimum, $1,000 of QBI), https://www.irs.gov/irb/2025-45_IRB
- Filing status Head of household, Qualified business income $30,000.00, QBI loss carried forward from 2025 (optional) $10,000.00, REIT dividends and PTP income (optional) $5,000.00, Taxable income before the QBI deduction $90,000.00 gives QBI component $4,000.00, REIT and PTP component $1,000.00, QBI deduction $5,000.00, QBI loss to carry to 2027 $0.00, REIT and PTP loss to carry to 2027 $0.00.Source: IRS Instructions for Form 8995 (2025): lines 1 to 17, https://www.irs.gov/instructions/i8995; IRC 199A(a), (b)(1) and (i), https://www.law.cornell.edu/uscode/text/26/199A (lines 3, 4, 6 to 10)
- Filing status Single, Qualified business income -$8,000.00, REIT dividends and PTP income (optional) $2,000.00, Taxable income before the QBI deduction $40,000.00 gives QBI component $0.00, REIT and PTP component $400.00, 2026 minimum deduction $0.00, QBI deduction $400.00, QBI loss to carry to 2027 -$8,000.00.Source: IRS Instructions for Form 8995 (2025): lines 1 to 17, https://www.irs.gov/instructions/i8995; IRC 199A(a), (b)(1) and (i), https://www.law.cornell.edu/uscode/text/26/199A (line 16 carries the loss forward)
How it works
The calculator follows Form 8995 for tax year 2026. Every amount is for 2026.
- Line 4 = qualified business income (line 2) − QBI loss carried forward from 2025 (line 3).
- QBI component (line 5) = 20% × line 4, or $0 when line 4 is $0 or less.
- Line 8 = qualified REIT dividends and PTP income (line 6, a PTP loss is negative) − the REIT and PTP loss carried forward from 2025 (line 7).
- REIT and PTP component (line 9) = 20% × line 8, or $0 when line 8 is $0 or less.
- Line 10 = line 5 + line 9.
- Income limit (line 14) = 20% × (taxable income before the QBI deduction − net capital gain and qualified dividends), or $0 when that is $0 or less.
- Deduction before the minimum (line 15) = the smaller of line 10 and line 14.
- 2026 minimum = $400 when QBI from businesses you materially participate in is at least $1,000; otherwise $0. With that box empty, the calculator uses the whole QBI on line 2 (this year's amount, before last year's carryforward).
- QBI deduction = the greater of line 15 and the 2026 minimum (IRC 199A(i)), even when that is more than the income limit.
- Taxable income after the deduction = taxable income before − the QBI deduction, not below $0.
- Carryforwards to 2027: line 4 when it is below $0 (line 16), and line 8 when it is below $0 (line 17); otherwise $0.
The 2026 Form 8995 is still a draft. It adds the minimum as a separate line and takes the greater of that line and line 15; the lines above follow the 2025 form, the statute and IRS Rev. Proc. 2025-32.
Who can use it. Only when taxable income before the QBI deduction is at or below the 2026 threshold for your filing status: $201,750 single, head of household and qualifying surviving spouse; $403,500 married filing jointly; $201,775 married filing separately. Above it the calculator gives no answer, because Form 8995-A applies.
Exact arithmetic. Every amount is read as the exact decimal you typed, each line is an exact fraction, and the results are rounded once to cents, half up.
Figures that change each year
These 2026 figures are adjusted for inflation each year. The data check should compare them with the next year's IRS revenue procedure.
| Figure | 2026 value | Source | Next update |
|---|---|---|---|
| Form 8995 threshold: single, head of household, qualifying surviving spouse | $201,750 | Rev. Proc. 2025-32 section 4.26 | The IRS inflation-adjustment revenue procedure for 2027 (October to November 2026) |
| Form 8995 threshold: married filing jointly | $403,500 | Rev. Proc. 2025-32 section 4.26 | Same |
| Form 8995 threshold: married filing separately | $201,775 | Rev. Proc. 2025-32 section 4.26 | Same |
| Minimum deduction | $400 | IRC 199A(i); Rev. Proc. 2025-32 section 2.12 | Indexed for inflation from 2027 (rounded to a multiple of $5) |
| Active QBI needed for the minimum | $1,000 | IRC 199A(i); Rev. Proc. 2025-32 section 2.12 | Indexed for inflation from 2027 (rounded to a multiple of $5) |
| Deduction rate | 20% | IRC 199A(a) and (b) | Fixed by law |
When the data is out of date
After April 15, 2027 the page keeps using the 2026 figures and says so above the result.
Assumptions
- Tax year 2026, Form 8995 only; not a patron of an agricultural or horticultural cooperative.
- QBI is already net of the deductions that belong to the business.
- Every amount is between −$1 trillion and $1 trillion; taxable income before the deduction and net capital gain are not below $0.
- An estimate, not tax advice.
Worked examples by hand
$60,000 of QBI, $80,000 taxable income, single. QBI component = 20% × 60,000 = $12,000. Income limit = 20% × 80,000 = $16,000. Line 15 = $12,000, above the $400 minimum, so the deduction is $12,000 and taxable income falls to $68,000.
The income limit binds, married filing jointly. QBI component = 20% × 150,000 = $30,000. Income limit = 20% × (120,000 − 20,000) = $20,000. The deduction is $20,000; taxable income after = $100,000.
Small QBI and the 2026 minimum. QBI component = 20% × 1,500 = $300; the income limit is 20% × 50,000 = $10,000, so line 15 = $300. QBI of $1,500 is at least $1,000, so the deduction is $400; taxable income after = 50,000 − 400 = $49,600.
A carryforward and REIT dividends, head of household. Line 4 = 30,000 − 10,000 = 20,000; QBI component = $4,000. REIT component = 20% × 5,000 = $1,000. Line 10 = $5,000, under the income limit of 20% × 90,000 = $18,000, so the deduction is $5,000.
A business loss. Line 4 = −8,000, so the QBI component is $0 and −$8,000 carries to 2027. REIT component = 20% × 2,000 = $400, under the income limit of $8,000. QBI is below $1,000, so no minimum applies; the deduction is $400.
Other questions people ask
How do you calculate the QBI deduction?
On Form 8995 it is 20% of your qualified business income plus 20% of qualified REIT dividends and PTP income, but no more than 20% of taxable income (before the deduction) minus net capital gain. With $60,000 of QBI and $80,000 of taxable income: 20% × 60,000 = $12,000, under the $16,000 limit, so the deduction is $12,000.
Who can use Form 8995 for 2026?
Anyone with QBI whose 2026 taxable income before the QBI deduction is at or below $201,750, or $403,500 married filing jointly and $201,775 married filing separately (IRS Rev. Proc. 2025-32). Above that, use Form 8995-A, where wage, property and service business limits phase in. Patrons of agricultural or horticultural cooperatives also use Form 8995-A.
What is the new $400 minimum deduction?
From 2026, if you have at least $1,000 of QBI from businesses you materially participate in, your QBI deduction is at least $400 (IRC 199A(i), added by P.L. 119-21). Passive income does not count toward the $1,000. Both amounts rise with inflation after 2026.
What counts as qualified business income?
The net profit of a business you own directly or through a partnership or S corporation, less the deductions that belong to it, such as half of self-employment tax, self-employed health insurance and retirement plan contributions. It does not include wages you earn as an employee, capital gains and losses, most interest and dividends, or reasonable pay and guaranteed payments the business pays you.
Why does capital gain lower the limit?
The law limits the deduction to 20% of taxable income minus net capital gain, so gains taxed at the capital gains rates do not support the deduction. Qualified dividends count as gain here. With $120,000 of taxable income and $20,000 of gains, the limit is 20% × 100,000 = $20,000.
What happens to a business loss?
If your QBI after last year’s carryforward is below zero, the QBI component is $0 and the loss carries forward to the next year (Form 8995 line 16), where it lowers that year’s QBI. A REIT or PTP loss carries forward on its own line (line 17).
Does the QBI deduction lower my self-employment tax?
No. It comes off after adjusted gross income, on Form 1040 line 13a, so it lowers taxable income but not adjusted gross income or self-employment tax.