Sarah, age 33, is a single taxpayer. In 2022, she had gross income of $89,000 from her self-employment as a sales consultant for which she received a Form 1099-K. Sarah is trying to plan wisely for her financial future, and she has investment income in addition to her self-employment income. She brings a Form 1099-DIV to her tax interview. Sarah did not provide a Form 1095-B or Form 1095-C but stated she had qualifying health care coverage all year.

Scenario
General Information
Sarah’s personal information has been pre-entered for you in the shell return. Use the
standard mileage rate to calculate Sarah’s automobile expenses. You may also refer to the information from Sarah’s Form 1099-DIV.

Business Expenses
Sarah also had the following business expenses in 2022. She has documentation to
support her business expenses.
• Advertising: $1,250
• Business Insurance: $650
• Legal: $485
• Office Expenses: $120
• Professional Dues: $175
• Office Rent: $14,400

Vehicle Information
Sarah used her personal vehicle for business purposes. No other vehicle is available for personal use, and her car is available for personal use during off-duty hours. She has written evidence to support the business use claimed. Her 2020 Honda Accord was purchased for $24,000 and placed in service on January 1, 2021. She drove a total of 18,000 miles in 2022, 8,800 of which were for business (4,400 from January-June and 4,400 from July-December). Sarah lives in an apartment above her office space. Thus, she has no commuting miles. The car was not acquired through trade-in and was not converted to non-business use. Sarah owned and used the car for 12 months in 2022

What is Sarah's Qualified Business Income Deduction (QBID) before the income limitation? $9,797 $12,378 $49,566 $61,891