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OBBBA raises the QBI pass-through deduction to 23% for 2026

OBBBA raises the QBI pass-through deduction to 23% for 2026

The One Big Beautiful Bill Act made the Qualified Business Income (QBI) deduction permanent and raised it from 20% to 23% for tax years beginning after Dec 31, 2025. It also guarantees a minimum $400 QBI deduction for anyone with at least $1,000 of qualified business income, effective on 2026 returns.

Why this matters for founders

Founders running pass-throughs (LLCs, S-corps, sole props) get a larger deduction on 2026 income; update estimated-tax calculations now to avoid over-withholding.

Source: Carr, Riggs & Ingram

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