For more videos on how to prepare Form 8995:

Form 8995A for an SSTB:    • How to File IRS Form 8995A and Sched...  
Form 8995 for PTP Income:    • IRS Form 8995 with Publicly Traded Pa...  
QBI Loss Carryovers:    • IRS Form 8995 with QBI Loss Carryforw...  
Form 8995 for REIT Dividends:    • How to File IRS Form 8995 with REIT D...  
Form 8995 for QBI Deduction:    • How to File IRS Form 8995 for Qualifi...  

Certain taxpayers may be able to deduct up to 20% of their qualified business income (QBI) from qualified trades or businesses. The QBI deduction under IRC Section 199A was added as part of the Tax Cuts and Jobs Act (TCJA) in 2017.

If a taxpayer has an overall negative QBI amount in the current period, those amounts should be carried forward indefinitely until used by future positive QBI.

In this example, we look at a partnership where a taxpayer recognized an ordinary loss during 2021, which created a negative QBI carryover to 2022. The QBI carryforward was reported on Form 8995 Line 3. Having to carry forward the negative QBI was not to the taxpayer's benefit, but it is required under the tax code.

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