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Qualified Business Income (QBI) Deduction

A tax deduction that allows eligible self-employed individuals and owners of pass-through businesses (like S-corporations and partnerships) to deduct a certain percentage of their qualified business income from their taxes.

Pass-through Business

A business structure (such as a sole proprietorship, partnership, or S-corporation) where business income is 'passed through' directly to the owners' personal tax returns and taxed at individual income tax rates, rather than the business itself paying corporate income tax.

Internal Revenue Code (IRC)

The comprehensive body of tax laws in the United States, administered by the Internal Revenue Service (IRS).

Estate Tax

A tax levied on the net value of the assets of a person who has died, before distribution to heirs. It is sometimes referred to as the 'death tax'.

Basis Step-Up

A tax rule for inherited assets where the value of the asset for tax purposes is reset to its market value on the date of the previous owner's death, rather than its original purchase price. This can reduce capital gains taxes if the asset is later sold.

Specified Service Trades or Businesses (SSTBs)

Certain professions or businesses (like doctors, lawyers, accountants, consultants, and athletes) that, under current law, have limitations on their ability to claim the full Qualified Business Income (QBI) deduction based on income thresholds.