There Are Three Limitations on the Qualified Business Income Deduction

question 8

True/False

There are three limitations on the qualified business income deduction: an overall limitation (based on modified taxable income), another that applies to high income taxpayers, and a third that applies to certain types of service businesses.

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Definitions:

Highest Rating

The top tier or grade assigned by rating agencies to entities or securities, indicating the lowest risk of default.

Bid Price

The highest price a buyer is willing to pay for an asset in the financial markets.

Dealer

An individual or firm in the financial markets that stands ready to buy or sell securities for their own account, at their own risk.

Security

A financial instrument that represents an ownership position in a publicly-traded corporation (stock), a creditor relationship with governmental body or a corporation (bond), or rights to ownership as represented by an option.