Small Business / K-1 Tax Pack

Why this Data Set exists

Tax planning for a small business owner is genuinely different from W-2 planning. The reasonable-salary determination drives both payroll tax and the QBI deduction. The QBI phaseout interacts with SSTB classification, taxable-income thresholds, and W-2 wages paid by the business. The Solo 401k contribution limit depends on whether the entity is an LLC taxed as sole proprietor, an S-Corp, or a partnership. The 1031 exchange structure for a business owner who also owns the operating real estate is its own planning surface. None of this fits the W-2 modal-customer assumptions baked into most planning tools.

When tools do try to handle small business owners, they often produce technically correct but practically useless outputs: a QBI calculation that doesn't account for the SSTB phaseout, a reasonable-salary suggestion that's a single number rather than a defensible range, a Solo 401k limit that doesn't model the employer contribution correctly. Real practitioners patch around the tooling with spreadsheets — exactly the friction the tooling was supposed to remove.

This Data Set provides the structured fixture data to build and validate planning tools that handle small business owners well. The 140 households cover the full entity taxonomy (LLC, S-Corp, partnership) and the practitioner-relevant edge cases (SSTB classification, partnership guaranteed payments, capital account tracking, multi-member coordination).

Use Cases

Who uses this Data Set

What's inside

The 140 households span ten archetypes covering the full small business taxonomy: solo practitioners (lawyers, doctors, consultants), small-business LLC owners, established business owners with multi-member partnerships, real estate investor entities, retired business owners holding equity in successor structures, and the niche cases (gig-economy LLCs, single-member partnerships under the family attribution rules).

Each household carries the structured business data: entity type (LLC sole-prop, LLC S-Corp election, S-Corp Inc., partnership, sole proprietorship), ownership percentage, K-1 distributions or pass-through income, reasonable-salary calculation with the comparable-data justification, QBI deduction with SSTB classification and phaseout calculations, guaranteed payments where applicable, and capital account balance with year-over-year reconciliation. The household-level personal tax fields integrate the business data appropriately — the K-1 income flows to the 1040, the QBI deduction is computed at the household level, and the Solo 401k contribution limit reflects the actual entity type rather than a generic assumption.

The Data Set ships as JSON and CSV. The WealthSynth Methodology PDF documents the entity taxonomy, the reasonable-salary methodology (with citations to the IRS factor analysis and the SS&C / RC reports advisors typically use), the QBI calculation including the SSTB classification rules, and field-by-field structures for partnership-specific complexity (guaranteed payments, special allocations, capital account reconciliation).

Preview a sample household

A redacted summary of one household from this Data Set — names, employers, exact balances, and metro area are stripped. Ages are bucketed, income and net worth are reported as bands. The full record (and all 140 like it) ships in the ZIP.

Technical Highlights

Sample Schema Fields

{
  "business.entity_type": <value>,
  "business.k1_distributions": <value>,
  "taxes.qbi_deduction": <value>,
  "business.reasonable_salary": <value>,
  "business.capital_account_balance": <value>
}

Sample queries

households.filter(h =>
  h.business.entity_type !== null &&
  h.business.is_sstb &&
  h.taxes.taxable_income >=
    h.taxes.qbi_phaseout_start &&
  h.taxes.taxable_income <=
    h.taxes.qbi_phaseout_end
)

households.filter(h =>
  h.business.entity_type === 'S-Corp' &&
  h.business.reasonable_salary < h.business.k1_distributions * 0.3
).sort((a, b) =>
  b.business.k1_distributions + b.business.reasonable_salary -
  a.business.k1_distributions - a.business.reasonable_salary)

households.filter(h => h.business.entity_type)
  .map(h => {
    const employee = Math.min(23000, h.business.reasonable_salary);
    const employer = h.business.entity_type === 'S-Corp'
      ? h.business.reasonable_salary * 0.25
      : (h.business.k1_distributions + h.business.reasonable_salary) *
        0.20;
    return {
      id: h.id,
      employee_max: employee,
      employer_max: employer,
      total_max: Math.min(employee + employer, 69000)
    };
  })

households.filter(h =>
  h.business.entity_type === 'Partnership'
).filter(h => {
  const expected = h.business.capital_account_prior_year +
    h.business.contributions_ytd -
    h.business.distributions_ytd +
    h.business.allocated_income_ytd;
  return Math.abs(h.business.capital_account_balance - expected) > 1;
})

Methodology

Each business-owner household is generated against archetype-specific distributions of revenue, EBITDA, owner compensation, and capital structure. Entity-type assignment is calibrated from IRS data on small-business filing types: LLC sole-prop is dominant for solo practitioners; LLC with S-Corp election is dominant for $100K+ revenue businesses; partnership is dominant for multi-member professional services; S-Corp Inc. appears for established mid-sized businesses. Reasonable-salary calculations use the IRS factor analysis (employee duties, training, time and effort, dividend history, payments to non-shareholder employees, compensation comparables). QBI deduction calculations include SSTB classification and the phaseout math; about 35% of the corpus is in or near the phaseout zone, which is where the planning value is highest. Partnership K-1s include guaranteed payments where structurally appropriate, and capital account tracking with realistic year-over-year reconciliation. The corpus passes the WealthSynth consistency validator (entity-level financials reconcile with personal-level K-1 income; capital account math is internally consistent) and the LLM-as-judge gate. Annual refresh re-runs against current-year QBI thresholds, SSTB phaseout brackets, and Solo 401k contribution limits.

Included Archetypes (10)

Frequently asked questions