Level 15
I wouldn't read too much into that example, which is under the subsection that deals with QBI of taxpayer's whose taxable income is below the threshold amounts and it refers to"net" business income (which although is not a term defined in the code, does highlight that it is after reduction of relevant amounts, whatever those may be), which only serves to simply the concept. If you take a look at the same example in the final regs, you'd see that northing in that example has changed despite the clarification.

Not everything in the code and the regs need to be spelled out in order for an existing principle to apply. Often times, it's only exceptions that get codified and regulations. promulgated to specify which among various related sections may govern the operation (e.g. related person for purposes of QBI).

One of the key emphasis of the Treasury and IRS is the structure and design of §199A, which is to mirror the tax treatment of C Corp and these items would all be deducted to arrive at the corporation's taxable income. On what basis should these not be under §199A?

For these reasons, personally, I do not believe that there is technical merit or a reasonable basis to take that position. I'm not sure how well you can defend the position relying solely on the preamble and Prop. Regs. being silent on the exact tax treatment and when the example remains the same even after clarifications are made with the promulgation of the Final Regs. But, again, that's just my personal opinion.
Still an AllStar
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