Deduction & QBI Savings Calculator

See how much the half-SE-tax deduction and the 20% Qualified Business Income deduction actually save you.

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Half-SE-Tax Deduction Amount—
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QBI Deduction Amount (20% of Net Income)—
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📊 This is a simplified estimate. The actual QBI deduction has income-based phase-outs and business-type restrictions (especially for specified service trades). Consult a CPA to confirm your actual eligibility and amount.

Two Deductions Every Self-Employed Person Should Know

Half-SE-Tax Deduction

You can deduct half of your total SE tax as an "above the line" adjustment to income — available whether or not you itemize.

QBI Deduction (Section 199A)

Most self-employed people and small business owners can deduct up to 20% of qualified business income, subject to income thresholds and business-type limits.

Phase-Out Ranges

The full 20% QBI deduction is generally available below certain income thresholds, with partial or no deduction above them for specified service businesses.

Stacking Both

These deductions apply independently — the half-SE-tax deduction reduces your income before the QBI calculation in some cases, so order matters. A CPA can optimize this for your specific numbers.

Worked Examples

Example 1 — $70,000 net income, 22% marginal rate

SE tax on $70,000: ≈ $9,891. Deductible half: ≈ $4,945 → tax savings ≈ $4,945 × 22% = $1,088.
QBI deduction: $70,000 × 20% = $14,000 → tax savings = $14,000 × 22% = $3,080.
Total estimated savings: ≈ $4,168.

Example 2 — $150,000 net income, 24% marginal rate

SE tax on $150,000: ≈ $21,194. Deductible half: ≈ $10,597 → tax savings ≈ $10,597 × 24% = $2,543.
QBI deduction: $150,000 × 20% = $30,000 → tax savings = $30,000 × 24% = $7,200.
Total estimated savings: ≈ $9,743. At this income, verify whether QBI phase-out rules apply to your specific business type.

Frequently Asked Questions

Does QBI phase out for high earners?

Yes, especially for specified service businesses above certain thresholds — those thresholds change periodically, so confirm current figures with a preparer.

Can I use the standard deduction and still claim QBI?

Yes, QBI is calculated separately and doesn't require itemizing.

Do S-corp owners get the same math?

No — S-corp QBI involves W-2 wage and basis rules this calculator doesn't model. It's built for sole proprietors and single-member LLCs.

Related Tools & Guides

Self-Employment Tax Calculator · Quarterly Estimated Tax Calculator · What Is the QBI Deduction? (full guide) · Full FAQ

Sources: IRS Topic No. 554 — Self-Employment Tax · IRS — Qualified Business Income Deduction. This tool provides estimates only — see our Disclaimer.