Map pass-through inputs to QBID-bearing PolicyEngine variables (#1051)

* Map pass-through inputs to QBID-bearing PolicyEngine variables

TAXSIM pass-through income sources produced wrong federal tax in the
emulator's PolicyEngine column (Dan Feenberg's 2026-06-30 five-source
comparison): pbusinc yielded zero AGI/tax, and psemp/scorp produced
correct AGI but no qualified business income deduction.

Root cause is in the emulator mapping layer, not policyengine-us. The
emulator initializes every mapped PolicyEngine variable as a dataset
input. pbusinc mapped to qualified_business_income — a COMPUTED variable
derived from self_employment_income et al. via the § 199A income
definition — so holding it as an input pinned it to whatever pbusinc
supplied (0 on all other records), zeroing the non-SSTB QBI component for
psemp and scorp too. scorp additionally mapped to the s_corp_income leaf
rather than partnership_s_corp_income, the variable named in the QBI
income definition.

Fix:
- psemp/ssemp and pbusinc/sbusinc -> self_employment_income (active
  participation, SECA, QBID without the SSTB phaseout; per Dan's spec
  businc is identical to semp). The mapper sums each spouse's own pair.
- scorp -> partnership_s_corp_income (QBID, no SECA, NIIT-eligible).
- pprofinc/sprofinc -> sstb_self_employment_income (QBID with the
  § 199A(d)(3) applicable-percentage phaseout) — unchanged, already right.

Aligns both the single-household mapper (core/input_mapper.py) and the
Microsimulation runner (runners/policyengine_runner.py), adds sbusinc to
the recognized input columns, and updates the S-corp splitting test to the
new mapping. New tests/test_passthrough_qbid.py reproduces Dan's five-source
table (AGI/taxable/income_tax) and pins the SSTB phaseout behavior.

Fixes #1004
Addresses #384
Addresses #762
Addresses #943
Addresses #1018
Addresses #1003

Co-Authored-By: Claude Fable 5 <noreply@anthropic.com>

* Regenerate dashboard config for the new pass-through mappings

Rerun extract-config so the dashboard's mapping documentation reflects the
QBID fix: pbusinc now shows self_employment_income (was
qualified_business_income) and pprofinc shows a proper
sstb_self_employment_income link. Also correct the self_employment_income
GitHub path (it lives in input/, not household/income/self_employment/) and
add the sstb_self_employment_income path to the link map.

Co-Authored-By: Claude Fable 5 <noreply@anthropic.com>

---------

Co-authored-by: Claude Fable 5 <noreply@anthropic.com>

Author: MaxGhenis

changelog.d/map-passthrough-qbid-variables.fixed.md

@@ -0,0 +1 @@
+Map TAXSIM pass-through inputs (psemp/ssemp, pbusinc/sbusinc, scorp, pprofinc/sprofinc) to QBID-bearing PolicyEngine variables so S-corp, active QBI, and self-employment income earn the qualified business income deduction.

dashboard/public/config-data.json

@@ -75,14 +75,14 @@
       "policyengine": "self_employment_income",
       "description": "Self-employment income of primary taxpayer",
       "implemented": true,
-      "githubLink": "https://github.com/PolicyEngine/policyengine-us/blob/master/policyengine_us/variables/household/income/self_employment/self_employment_income.py"
+      "githubLink": "https://github.com/PolicyEngine/policyengine-us/blob/master/policyengine_us/variables/input/self_employment_income.py"
     },
     {
       "taxsim": "ssemp",
       "policyengine": "self_employment_income",
       "description": "Self-employment income of secondary taxpayer",
       "implemented": true,
-      "githubLink": "https://github.com/PolicyEngine/policyengine-us/blob/master/policyengine_us/variables/household/income/self_employment/self_employment_income.py"
+      "githubLink": "https://github.com/PolicyEngine/policyengine-us/blob/master/policyengine_us/variables/input/self_employment_income.py"
     },
     {
       "taxsim": "dividends",
@@ -149,17 +149,17 @@
     },
     {
       "taxsim": "pbusinc",
-      "policyengine": "qualified_business_income",
-      "description": "Primary and secondary Taxpayer's active QBI",
+      "policyengine": "self_employment_income",
+      "description": "Primary taxpayer's active QBI",
       "implemented": true,
-      "githubLink": "https://github.com/PolicyEngine/policyengine-us/blob/master/policyengine_us/variables/gov/irs/income/taxable_income/deductions/qualified_business_income_deduction/qualified_business_income.py"
+      "githubLink": "https://github.com/PolicyEngine/policyengine-us/blob/master/policyengine_us/variables/input/self_employment_income.py"
     },
     {
       "taxsim": "pprofinc",
       "policyengine": "sstb_self_employment_income",
       "description": "Primary taxpayer's SSTB self-employment income",
       "implemented": true,
-      "githubLink": null
+      "githubLink": "https://github.com/PolicyEngine/policyengine-us/blob/master/policyengine_us/variables/input/sstb_self_employment_income.py"
     },
     {
       "taxsim": "rentpaid",
@@ -280,5 +280,5 @@
       }
     ]
   },
-  "lastUpdated": "2026-06-22T00:34:33.871Z"
+  "lastUpdated": "2026-07-05T15:19:19.288Z"
 }

dashboard/scripts/extract-config.cjs

@@ -29,7 +29,8 @@ function generatePolicyEngineGitHubLink(variableName) {
   const variablePathMap = {
     // Income variables
     'employment_income': 'input/employment_income.py',
-    'self_employment_income': 'household/income/self_employment/self_employment_income.py',
+    'self_employment_income': 'input/self_employment_income.py',
+    'sstb_self_employment_income': 'input/sstb_self_employment_income.py',
     'qualified_dividend_income': 'household/income/person/dividends/qualified_dividend_income.py',
     'taxable_interest_income': 'household/income/person/interest/taxable_interest_income.py',
     'short_term_capital_gains': 'household/income/person/capital_gains/short_term_capital_gains.py',

policyengine_taxsim/api.py

@@ -76,6 +76,7 @@
     "mortgage",
     "scorp",
     "pbusinc",
+    "sbusinc",
     "pprofinc",
     "sprofinc",
     "idtl",

policyengine_taxsim/config/variable_mappings.yaml

@@ -796,13 +796,33 @@ taxsim_to_policyengine:
           - dividends
       - long_term_capital_gains:
           - ltcg
+      # psemp/ssemp (self-employment) and pbusinc/sbusinc (active QBI) both
+      # map to self_employment_income: active-participation income subject to
+      # SECA that flows into the § 199A QBID without the SSTB phaseout. Per
+      # Dan Feenberg's spec, businc is identical to semp (active + SECA +
+      # QBID-without-phaseout), so they share one PolicyEngine variable.
+      # Do NOT map to qualified_business_income: that PE variable is COMPUTED
+      # (from self_employment_income et al. via the QBI income_definition), so
+      # supplying it as a dataset input holds it at that value and zeroes every
+      # other record's non-SSTB QBI. Per-person routing (psemp+pbusinc ->
+      # primary, ssemp+sbusinc -> spouse) is handled in the mapper code.
       - self_employment_income:
           - psemp
           - ssemp
-      - s_corp_income:
-          - scorp
-      - qualified_business_income:
           - pbusinc
+          - sbusinc
+      # scorp maps to partnership_s_corp_income, the variable named in the QBI
+      # income_definition (it adds partnership_income + s_corp_income). Mapping
+      # to the leaf s_corp_income instead held it as a dataset input, which
+      # suppressed its uprating formula; and with qualified_business_income also
+      # held at 0, S-corp income produced correct AGI but no QBID.
+      - partnership_s_corp_income:
+          - scorp
+      # pprofinc/sprofinc (SSTB professional-service income) map to
+      # sstb_self_employment_income: subject to SECA, QBID WITH the
+      # § 199A(d)(3) applicable-percentage phaseout. PE tracks SSTB income in
+      # this dedicated input so the phaseout reduces only the SSTB component;
+      # no business_is_sstb flag is needed on this path.
       - sstb_self_employment_income:
           - pprofinc
           - sprofinc
@@ -894,7 +914,10 @@ taxsim_input_definition:
   - scorp:
       name: "26. S-Corp profits"
   - pbusinc:
-      name: "27. Primary and secondary Taxpayer's active QBI"
+      name: "27. Primary taxpayer's active QBI"
+      pair: sbusinc
+  - sbusinc:
+      name: "27b. Spouse's active QBI"
   - pprofinc:
       name: "28. Primary taxpayer's SSTB self-employment income"
       pair: sprofinc

policyengine_taxsim/core/input_mapper.py

@@ -27,7 +27,7 @@ def add_additional_units(state, year, situation, taxsim_vars):
         "taxable_interest_income",
         "qualified_dividend_income",
         "long_term_capital_gains",
-        "s_corp_income",
+        "partnership_s_corp_income",
         "taxable_private_pension_income",
         "short_term_capital_gains",
         "social_security_retirement",
@@ -69,12 +69,24 @@ def add_additional_units(state, year, situation, taxsim_vars):
                 continue
 
             if field == "self_employment_income":
-                if "psemp" in taxsim_vars:
-                    people_unit["you"][field] = {str(year): taxsim_vars.get("psemp", 0)}
-                if "your partner" in people_unit and "ssemp" in taxsim_vars:
-                    people_unit["your partner"][field] = {
-                        str(year): taxsim_vars.get("ssemp", 0)
-                    }
+                # psemp (self-employment) and pbusinc (active QBI) both feed the
+                # primary's self_employment_income; ssemp and sbusinc feed the
+                # spouse's. Both income types are active-participation, SECA-
+                # bearing, and QBID-eligible without the SSTB phaseout, so they
+                # share one PolicyEngine variable (Dan Feenberg: businc is, by
+                # his spec, identical to semp). Summing here — rather than
+                # giving pbusinc a second field — keeps one input from
+                # overwriting the other.
+                primary_se = taxsim_vars.get("psemp", 0) + taxsim_vars.get("pbusinc", 0)
+                if "psemp" in taxsim_vars or "pbusinc" in taxsim_vars:
+                    people_unit["you"][field] = {str(year): primary_se}
+                if "your partner" in people_unit and (
+                    "ssemp" in taxsim_vars or "sbusinc" in taxsim_vars
+                ):
+                    spouse_se = taxsim_vars.get("ssemp", 0) + taxsim_vars.get(
+                        "sbusinc", 0
+                    )
+                    people_unit["your partner"][field] = {str(year): spouse_se}
 
             elif field == "sstb_self_employment_income":
                 if "pprofinc" in taxsim_vars:

policyengine_taxsim/core/yaml_generator.py

@@ -189,8 +189,12 @@ def generate_yaml(
                 "long_term_capital_gains",
                 "short_term_capital_gains",
                 "rental_income",
-                "s_corp_income",
-                "qualified_business_income",
+                # scorp -> partnership_s_corp_income (QBID-bearing aggregate);
+                # pprofinc/sprofinc -> sstb_self_employment_income (QBID with
+                # SSTB phaseout). pbusinc now folds into self_employment_income,
+                # so qualified_business_income is no longer set as an input.
+                "partnership_s_corp_income",
+                "sstb_self_employment_income",
                 "w2_wages_from_qualified_business",
                 "business_is_sstb",
                 "business_is_qualified",

policyengine_taxsim/runners/policyengine_runner.py

@@ -214,7 +214,7 @@ def _initialize_dataset_structure(self) -> dict:
             "taxable_interest_income",
             "qualified_dividend_income",
             "long_term_capital_gains",
-            "s_corp_income",
+            "partnership_s_corp_income",
             "short_term_capital_gains",
         }
     )
@@ -290,6 +290,20 @@ def accessor(row):
 
         return accessor
 
+    @staticmethod
+    def _make_sum(*source_fields):
+        """Return a callable summing several TAXSIM columns for one person.
+
+        Used where two per-person TAXSIM inputs feed a single PolicyEngine
+        variable — e.g. psemp (self-employment) + pbusinc (active QBI) both
+        populate the primary's self_employment_income. Each column is already
+        per-person in TAXSIM-35, so no MFJ splitting is applied here."""
+
+        def accessor(row):
+            return sum(float(row.get(f, 0)) for f in source_fields)
+
+        return accessor
+
     @classmethod
     def _make_age_gated_primary(cls, source_field):
         """Allocate age-gated income (pension, gssi) to the primary filer's
@@ -383,6 +397,21 @@ def _get_taxsim_to_pe_variable_mapping(self) -> dict:
                     if not taxsim_vars:  # Skip empty mappings
                         continue
 
+                    if pe_var == "self_employment_income":
+                        # psemp + pbusinc feed the primary's self_employment_income;
+                        # ssemp + sbusinc feed the spouse's. Both are per-person
+                        # TAXSIM columns (no household splitting), so sum each
+                        # spouse's own pair. Handled explicitly because the
+                        # generic length-based branches below only read the first
+                        # one or two columns of the list.
+                        variable_mapping[pe_var] = {
+                            "primary": self._make_sum("psemp", "pbusinc"),
+                            "spouse": self._make_sum("ssemp", "sbusinc"),
+                            "dependent": 0.0,
+                            "default": 0.0,
+                        }
+                        continue
+
                     if len(taxsim_vars) == 1:
                         # Single variable - check if it has a spouse pair
                         taxsim_var = taxsim_vars[0]

policyengine_taxsim/runners/taxsim_runner.py

@@ -69,6 +69,10 @@ class TaxsimRunner(BaseTaxRunner):
         "childcare",  # Child care expenses
         "mortgage",  # Mortgage interest
         "scorp",  # S-Corp profits
+        "pbusinc",  # Primary taxpayer's active QBI (QBID, no SSTB phaseout)
+        "sbusinc",  # Spouse's active QBI
+        "pprofinc",  # Primary taxpayer's SSTB self-employment income
+        "sprofinc",  # Spouse's SSTB self-employment income
         "idtl",  # Output control
     ]