To determine if a business qualifies as a “qualified trade or business” under Section 199A, it must meet certain criteria:
- General Definition: A qualified trade or business is any trade or business that is not a specified service trade or business (SSTB) or the trade or business of performing services as an employee.
- Section 162 Trade or Business: The business must be a trade or business under Section 162, which generally means it is conducted with a good-faith intention to earn a profit and is carried out on a regular and continuous basis.
- Exclusions:
- C Corporations: Businesses conducted by C corporations are not eligible.
- Employee Services: Income earned from performing services as an employee does not qualify.
- Specified Service Trades or Businesses (SSTBs): For taxpayers with taxable income exceeding certain thresholds, SSTBs (such as health, law, consulting, athletics, financial services, and brokerage services) are excluded.
If you provide more details about the specific business in question, I can help you further determine its eligibility. Does this align with the type of business you’re inquiring about?
