Removing QBI Deduction

Forum|Forum|3 years ago
March 6, 2023
2 replies
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Hello, I am seeking help removing the QBI deduction which I believe is incorrectly being applied due to 1099-Misc income I receive. Details below:

- I am not employed nor do I own a business (i.e., I am retired)

- I receive a 1099-Misc for Pension Income. When entering the 1099-Misc into TurboTax, I specify that it "doesn't involve work like my main job" and "doesn't involve an intent to earn money"

- I have stock investments in REITs which is triggering the QBI deduction; however, I don't think I should be getting the deduction since I do not have self-employment income. It seems the 1099-Misc is triggering TurboTax to apply the QBI deduction even though the 1099-Misc is for pension income.

Do I need to remove the QBI deduction? If so, can someone advise how to do this? Thanks!

- Note: I've asked the Trustee for my pension income to provide a 1099-R instead of a 1099-misc though they've advised it's too late in the year to make the change now and will update this next year.

TurboTax Premier Online

Best answer by MinhT1

The 1099-MISC does not make you eligible for the QBI deduction.

If you have Section 199A dividends (which are REIT dividends) reported in box 5 of form 1099-DIV, you will be eligible for the QBI deduction as Section 199A dividends are QBI (qualified business income). You do not need to remove the QBI deduction. It is legitimate.

Please read this IRS document for more information.

Bsch4477

Employee

Look at your 1099-DIV to see if there is an amount in Box 5. If so, that’s triggering the QBI and is a legitimate adjustment.

RGB15Author

Thanks, there is an amount listed in Box 5. I figured TurboTax was erroneously giving me the QBI deduction because of the 1099-misc pension income but I appreciate you clarifying.

MinhT1Answer

The 1099-MISC does not make you eligible for the QBI deduction.

Please read this IRS document for more information.

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