Multiple Businesses? Your 199A Deduction May Be Shrinking
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You’ve grown past one business — maybe a rental property, an S corporation, and a Schedule C side venture all under your name. Each one qualifies for the 20 percent Section 199A deduction on its own, or so you’d think.
But once your taxable income climbs past six figures, how you enter those businesses — separately or aggregated together — can swing your deduction by tens of thousands of dollars, and most owners have no idea which side of that line they’re on.
In one real case, entering three businesses separately produced a $37,340 Section 199A deduction. Aggregating those same three businesses produced $94,131.