IRC 199A(d)(2) defines a specified service trade or business (SSTB) for the qualified business income deduction. It covers businesses performing services in:
- health, law, accounting and actuarial science
- consulting, financial services and brokerage services
- the performing arts and athletics
- investing, trading or dealing in securities or commodities
- any business whose principal asset is the reputation or skill of its owners or employees, which the regulations narrow to income from endorsements, the use of a name or likeness, and appearance fees
Engineering and architecture are expressly left out, so an engineer or architect is not an SSTB even though the work is professional.
The label matters only at higher incomes. Below $201,750 of taxable income for single filers and $403,500 for joint filers in 2026, an SSTB gets the deduction like any other business. Over the next $75,000 ($150,000 for joint filers) it phases out, and above that it is gone. A large cash balance contribution lowers taxable income, so for an SSTB owner in or above that range it can bring the deduction back, and each dollar contributed can save more than the top tax rate alone would suggest.
See the QBI deduction and retirement contributions, and the pages for physicians, attorneys, consultants and engineers and architects.