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This is what I found on the IRS website. Is there a better reference? One that would hold up in court....
Q5. What is a qualified trade or business?A5. A qualified trade or business is any trade or business, with two exceptions:
- Specified service trade or business (SSTB), which includes a trade or business involving the performance of services in the fields of health, law, accounting, actuarial science, performing arts, consulting, athletics, financial services, investing and investment management, trading, dealing in certain assets or any trade or business where the principal asset is the reputation or skill of one or more of its employees. This exception only applies if a taxpayer’s taxable income exceeds $315,000 for a married couple filing a joint return, or $157,500 for all other taxpayers
- Performing services as an employees
These FAQs are not included in the Internal Revenue Bulletin, and therefore may not be relied upon as legal authority. This means that the information cannot be used to support a legal argument in a court case.
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One stop shopping, Archery to hunt your game, taxidermy to mount your game, tattoo artist to give you a remembrance of your trophy
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One stop shopping, Archery to hunt your game, taxidermy to mount your game, tattoo artist to give you a remembrance of your trophy
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Those are decision YOU, the tax pro, gets paid to determine based on the facts & circumstances. Blanket answers, for strangers on the internet, would not be considered authoritative.
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In answer to the question, I think the best "official" resource (which will stand up in court) is the preamble to the Proposed Regulations, and starting on page 57 it goes through each of those categories.
https://www.irs.gov/pub/irs-drop/reg-107892-18.pdf#page=57
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I'm not sure how clear you are or aren't about QBI vs SSTB. See if this helps:
http://www.daviscpas.com/wp-content/uploads/2018/09/QBI-Deduction-Flowchart.pdf
Slava Ukraini!
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There is guidance (the Proposed Regulations?) for the "reputation or skill" one , and that limits it to EXTREMELY limited purposes.
As for the three occupations that you listed, I don't see that fitting into any of those categories.
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I'm thinking "tattoo" artist might be one of those "skill of the owner" business?
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Slava Ukraini!
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In sum, the Treasury Department and the IRS believe that the “reputation or skill” clause as used in section 199A was intended to describe a narrow set of trades or businesses, not otherwise covered by the enumerated specified services, in which income is received based directly on the skill and/or reputation of employees or owners. Additionally, the Treasury Department and the IRS believe that “reputation or skill” must be interpreted in a manner that is both objective and administrable.
Thus, proposed §1.199A-5(b)(2)(xiv) limits the meaning of the “reputation or skill” clause to fact patterns in which the individual or RPE is engaged in the trade or business of
(1) receiving income for endorsing products or services, including an individual’s distributive share of income or distributions from an RPE for which the individual provides endorsement services;
(2) licensing or receiving income for the use of an individual’s image, likeness, name, signature, voice, trademark, or any other symbols associated with the individual’s identity, including an individual’s distributive share of income or distributions from an RPE to which an individual contributes the rights to use the individual’s image;o
(3) receiving appearance fees or income (including fees or income to reality performers performing as themselves on television, social media, or other forums, radio, television, and other media hosts, and video game players).
https://www.irs.gov/pub/irs-drop/reg-107892-18.pdf#page=65
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Thanks, Bill. What if all the tattoos are the artist's likeness ????

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Still an AllStar
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