Rachel Is an Accountant Who Practices as a Sole Proprietor

question 56

Essay

Rachel is an accountant who practices as a sole proprietor.This year,Rachel had net business income of $200,000 from her practice.Assume that Rachel pays $50,000 wages to her employees,she has $20,000 of property (unadjusted basis of equipment she purchased last year),she has no capital gains,and her taxable income before the deduction for qualified business income is $140,000.Calculate Rachel's deduction for qualified business income.

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Definitions:

Dizygotic

Referring to twins that are born from two different eggs fertilized by two different sperm cells, resulting in siblings that are genetically as similar as any other brothers or sisters.

Canalized

A term referring to the limitation of the expression of genetic variability due to genetic or environmental influences, resulting in a trait that is shaped to follow a predictable pattern regardless of variations.

Genetic-Environment Correlations

The interaction between an individual's genetic makeup and their surrounding environment, influencing traits and behaviors.

Passive Correlation

A concept in behavioral genetics where an individual's traits result indirectly from the environment provided by their biological parents.