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Can I take a 199A/QBI deduction?

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  • Can I take a 199A/QBI deduction?

    Hey guys, wanted your opinion on if I can take a 199A/QBI deduction or not on my 1099 income. I make 1099 income on medical surveys, drug talks, doing some legal work, and reading nerve conduction studies of patients. I had thought that my 1099 income was too related to my primary work as a medical doctor in health to qualify me for this deduction but I wanted to verify with you guys. I would pee in my pants trying to convince an IRS agent that this income does not relate to health or law and not qualify as a specified service trade/business, but maybe I'm overthinking it. thanks!

  • #2
    I have a couple of thoughts. The first is that if your income is below the phase-out range you'll get the QBID even if your 1099 income is deemed to be in the field of "health".

    The second is reading the definition of the field of health in §1.199A-5(b)(2) which reads -
    For purposes of section 199A(d)(2) and paragraph (b)(1)(i) of this section only, the performance of services in the field of health means the provision of medical services by individuals such as physicians, pharmacists, nurses, dentists, veterinarians, physical therapists, psychologists, and other similar healthcare professionals performing services in their capacity as such. The performance of services in the field of health does not include the provision of services not directly related to a medical services field, even though the services provided may purportedly relate to the health of the service recipient. For example, the performance of services in the field of health does not include the operation of health clubs or health spas that provide physical exercise or conditioning to their customers, payment processing, or the research, testing, and manufacture and/or sales of pharmaceuticals or medical devices.
    Because §199A is relatively new there isn't much if any case history or other guidance beyond this.

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    • #3
      thanks! unfortunately (or fortunately I guess) I am above the phase-out range with my income. Thank you for the clarification with the second point seems to clearer to me that my reading of nerve conduction studies would be to directly related to providing a medical service.

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