How much is qualified business income for the separate trade

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Problem 1: Patricia is a 25% owner and an active member in PBC LLC, which operates a qualified trade or business. For the purposes of the deduction under 199A, Patricia's distributive share of qualified income from the LLC is $250,000 for the year. The LLC's income was $1,000,000. Her share of the LLC's W-2 wages is $40,000. She received a guaranteed payment for services of $30,000. Her share of the LLC's unadjusted basis immediately after the acquisition of qualified property was $1,200,000. How much is her qualified business income for this separate trade or business?

a. $20,000.
b. $40,000.
c. $50,000.
d. $35,000.
e. $47,500.

Reference no: EM132965235

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