What is the maximum Qualified Business Income Deduction (QBI) that can be claimed?

The maximum Qualified Business Income Deduction (QBI) allowable under the Tax Cuts and Jobs Act is 20%. This deduction is intended to benefit owners of pass-through entities such as sole proprietorships, partnerships, S corporations, and some trusts and estates. The QBI deduction allows qualified businesses to deduct up to 20% of their qualified business income from their taxable income, thereby reducing their overall tax liability.

It’s important to note that while the deduction is capped at 20%, specific income thresholds and limitations might apply based on the nature of the business and the taxpayer's taxable income. However, irrespective of the specifics, the maximum percentage that can be claimed remains at 20%, making it a significant element in tax planning for business owners.