“To amend the Internal Revenue Code of 1986 to enhance the qualified business income deduction for domestic manufacturers, and for other purposes.”
No CRS summary available for this bill.
This section increases the qualified business income deduction to 30 percent (from 20 percent) and raises the W-2 wage limitation to 100 percent (from 50 percent) for qualified domestic manufacturers. A qualified domestic manufacturer is a taxpayer for whom at least 85 percent of combined qualified business income derives from a trade or business that manufactures tangible property and incurs at least 20 percent of allocable cost of goods sold from U.S. labor and overhead. It also computes taxable income without regard to the overall limitation on itemized deductions, the section 199A deduction itself, or the charitable contribution deduction for itemizers. The changes apply to taxable years beginning after December 31, 2025.