How Might Section 199A Work Under House Proposal and the Rate is Now 23%
We review how the 199A deduction will work under the House proposal.
The House Ways and Means last week issued part of their plan for income taxes. Part of that plan changed how Section 199A will work and most of the changes are very positive.
However, in the text of the total tax bill released on Monday May 12, 2025, the rate was increased from 22% in last Friday’s text to 23%.
There is no longer a phase-in of the wage and wage plus investment if your taxable income is over the threshold.
Under current rules, once you are fully over the threshold, your Section 199A deduction is limited to the greater of:
