Doctors Qualify for Section 199a Deduction

The Tax Cuts and Jobs Act of 2017 wrote into law Internal Revenue Code Section 199a, the Qualified Business Income Deduction. This 20% deduction is available to owners of certain pass-through entities and has the potential to reduce a business’s effective tax rate by a significant amount. Unfortunately, the deduction is not available to all taxpayers. Not only is the deduction limited for high earners, but owners in certain service industries are phased out of the benefit completely. Some doctors will be able to benefit from this new tax deduction, but others will not be so lucky.