Form 8995: Your Guide to Qualified Business Income Deductions
Did you read the title and think, "what is Form 8995?" If you did, you aren't alone. This is a relatively new IRS form for claiming pass-through deductions on your qualified business income (QBI).
In addition to Form 8995, the IRS also has Form 8995-A containing four sections and an additional four schedules. This form is what you use to calculate your qualified business income, potential deduction phaseouts, and the resulting deduction.
Sound complicated? In 2020 the IRS assessed around $6 billion in employer penalties for business income tax miscalculations or missing payments.
Don't become an IRS statistic. Keep reading our qualified business income guide to learn how Form 8995 helps determine your qualified business income deduction (QBID).