In our recent Client Alert, we provided a summary of salient parts of the Tax Cuts and Jobs Act of 2017. Under the section Pass-Through Businesses, we wrote: “Pass-through income exceeding the $315,000/$157,000 thresholds receives no 20% deduction.” We misstated the phase out provisions.
Here is what we should have stated:
· If taxable income is less than $157,500 (single filer)/$315,000 (married filing jointly) the 20% deduction is fully available.
· If taxable income is greater than $157,500 (single filer)/$315,000 (married filing jointly) but less than $207,500 (single filer)/$415,000 (married filing jointly) then a partial deduction is available.
· If taxable income is greater than $207,500 (single filer)/$415,00 (married filing jointly) there is no deduction.
We occasionally mess up, and when we do, we endeavor to fix it.