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I am so confused. Is the W-2 wages the total wages for all the employees in the company or just the shareholder's W-2 wages? If all W-2 wages are 500,000 and out of the $500,000, $100,000 of the W-2 wages were for the sole shareholder in an S corp, which W-2 wages are they referring to? The total of $500,000 or just $100,000? Do you need to make any adjustments for the Shareholders wages of $100,000?
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ALL wages are used in the QBID computation.
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Thank you for your response. Do I need to deduct the shareholds wages from the S corp from the QBI?
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Lacerte handles all of this quite well.... ARE you using Lacerte?
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Agree with Anna.
For fundamental questions about what constitutes W-2 wages, you may like to refer to TD-Reg-107892-18 and Rev. Proc. 2019-11.
Still an AllStar
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I am using Lacerte. On the Individual side, why isn't Lacerte deducting the shareholder wages from QBI? I am not sure if I need to connect the W-2 wages to the activity or manually enter the wages to deduct from QBI. Also, lacerte isn't deducting the 2% shareholders health insurance.
