Final Rules Developed for the Section 199A Deduction (Journal Article)

Treasury issued Treasury Decision 9847 on February 8, 2019, providing final regulations for the determination of the amount of the deduction (of up to 20 percent) for qualified domestic businesses. The preamble to the final regulations is approximately 61 pages, which includes responses by the Treasury and the IRS to questions raised by over 335 responders to the proposed regulations. Although many of the comments and requests are addressed in the final regulations, Treasury and the IRS do acknowledge there are some issues that will still need further thought before guidance is provided. In this article, the focus is on those decided issues that are more relevant to those in the financial services area.

Author: Anthony P. Curatola, PhD, is the Joseph F. Ford Professor of Accounting and Tax at Drexel University in Philadelphia. He is the editor of the monthly tax column appearing in Strategic Finance.

Author: J. William Harden, PhD, CPA, ChFC, is an associate professor of accounting in the Bryan School of Business and Economics at the University of North Carolina at Greensboro. Bill researches and consults in the areas of taxation and financial planning for small businesses and individuals.