What is the deduction of domestic production activities?

Disduling of domestic production activities is a deduction of taxes in the United States. It allows companies involved in certain production activities to deduct their income for tax purposes, thereby reducing their tax liability. The deduction is designed to support domestic production. In the first tax year, it came into force, 2004-5, the level was 3%. This increased to 6% of the 2006-7 tax year and 9% since 2009–10. This includes the sale, rent and licenses of all items produced in the United States. The number also includes building services in the United States and engineering and architectural services that relate to the American construction project. Deduction also includes sales, rental and licenses of films produced by the US and software development. Although public services such as gas and electricity, it falls under the deduction, offer and transmission. The first is purely cosmetic construction services such as painting. The second is the sale of food and beverages that are prepared in retail equipment.

The calculation of the deduction can be a complicated process, with a limitation of both the share of the income of the company that qualifies and the total amount of the deduction. If all the company's production and production activities are carried out in the United States, all related incomes are qualified. If any of the activities are carried out outside the US, the company must prove that at least 20% of its ties on the holes come directly from the work and overhead expenditures in the United States. If this is not the case, the company can only require a deduction of income that specifically results from US costs.

There are also a limitation of the amount of the deduction itself. In one owner's business or partnership, the deduction must not exceed the gross income of the owner or owners. In any business with employees, the deduction must not exceed 50% of the total payments to employees, as stated when the W-2 returns.