Felipe, a single taxpayer, is a technology consultant, who operates as a sole proprietorship. Felipe’s net business income is $600,000, he pays wages of $100,000 to his employees, and he has $200,000 of qualified property (unadjusted basis). Felipe’s taxable income before the deduction for qualified business income is $500,000. Assume he has no capital gains or qualified dividends.
a. Calculate Felipe’s deduction for qualified business income.

b. How would your answer to (a) change if Felipe was an investment broker.