### Question
How is the term qualified items of income, gain, deduction, and loss defined?


### Answer
The term **qualified items of income, gain, deduction, and loss** is defined in *26 U.S.C. § 199A* as the following:

> items of income, gain, deduction, and loss to the extent such items are—


(i) effectively connected with the conduct of a trade or business within the United States (within the meaning of section 864(c), determined by substituting "qualified trade or business (within the meaning of section 199A)" for "nonresident alien individual or a foreign corporation" or for "a [1](#199A_1_target) foreign corporation" each place it appears), and


(ii) included or allowed in determining taxable income for the taxable year

#### Citation:
  - *26 U.S.C. § 199A*
  - Heading: **Subtitle A-Income Taxes > CHAPTER 1-NORMAL TAXES AND SURTAXES > Subchapter B-Computation of Taxable Income > PART VI-ITEMIZED DEDUCTIONS FOR INDIVIDUALS AND CORPORATIONS**

