Question New GOP Tax Bill on 20% income deduction 4 passthrough

[Ray Slack]

Quick question..  below is the new proposed GOP 20% deduction for pass through businesses.  Is this like a standard deduction?  or a cap?  So, I have a S-Corp that is a pass through so if I make $100k income and $50k in expenses,   Would I  then get 20% deduction off my $50,000 in net income? Reducing my net taxable income to $40,000?  or am I missing something? 

Thank

MP

PASS-THROUGH BUSINESSES

Republicans propose a 20% income deduction for so-called pass-through businesses such as partnerships and S corporations, which pay taxes through individual returns. That is lower than the 23% deduction in the Senate bill, but when combined with the lower top tax rate on ordinary income, it equates to a nearly identical 29.6% top rate on that income for pass-throughs. The bill also includes some version of House language letting pass-through firms qualify for a tax break based on their capital investment.

Current: Pass-through business taxes based on individual income tax rates and brackets

Proposed: Business owners get a 20% deduction for pass-through income; phases out for some businesses starting at $315,000 of income for joint filers