Updated October 19, 2026. Quick answer: Schedule D (Form 8995-A) is for patrons of specified agricultural or horticultural cooperatives who claim a QBI deduction on business done with the cooperative. It produces the patron reduction, the lesser of 9% of QBI or 50% of W-2 wages allocable to qualified payments.
Quick reference
| Item | As the IRS form or instructions state it |
|---|---|
| Who completes it | A patron in a specified agricultural or horticultural cooperative claiming a QBI deduction |
| QBI limb of the reduction | 9% of QBI allocable to qualified payments |
| Wage limb of the reduction | 50% of W-2 wages allocable to qualified payments |
| Reduction applied as | “the lesser of” |
| Result carried to Form 8995-A | “Report the amount from Schedule D (Form 8995-A), line 6, if any.” |
| Taxable income that triggers the form | Above $197,300 ($394,600 if married filing jointly), or a patron |
| Edition | Form 8995-A (2025) |
What Schedule D is for
The instructions title it “Schedule D (Form 8995-A), Special Rules for Patrons of Agricultural or Horticultural Cooperatives”. They say you “must complete Schedule D (Form 8995-A) if you’re a patron in a specified agricultural or horticultural cooperative and are claiming a QBI deduction in relation to your trade or business conducted with the cooperative.”
A specified cooperative is defined this way: “A specified agricultural or horticultural cooperative is a cooperative that markets or is engaged in the manufacturing, production, growth, or extraction of any agricultural or horticultural products to which Part I of subchapter T applies.”
Who uses Form 8995-A, and the cooperative’s side
Patrons can use the longer form at any income level. The form says “Use this form if your taxable income, before your qualified business income deduction, is above $197,300 ($394,600 if married filing jointly), or you’re a patron of an agricultural or horticultural cooperative.”
The cooperative itself does not file it: “Cooperatives don’t file Form 8995-A because they’re not eligible for the deduction.” The simplified computation is Form 8995.
The patron reduction
The reduction reaches Form 8995-A at line 14. The instructions say “Patrons of agricultural or horticultural cooperatives are required to reduce their QBI component by the lesser of:” The two limbs are:
- “9% of QBI allocable to qualified payments from a specified cooperative, or”
- “50% of W-2 wages allocable to qualified payments.”
On the form, line 14 reads “Patron reduction. Enter the amount from Schedule D (Form 8995-A), line 6, if any.” Line 15 then follows the instruction “Subtract the patron reduction on line 14 from the amount on line 13. If zero or less, enter zero.”
Line by line
Line 2 uses allocated income: “Input the QBI for the trade or business as properly allocable to qualified payments received from the cooperative.” On what counts: “Qualified payments include patronage dividends and per-unit retains allocations.”
Line 4 uses allocated wages: “Enter the portion of W-2 wages from Form 8995-A, line 4, that are allocable to the qualified payments.” Line 6 holds the reduction that moves to Form 8995-A, line 14.
The instructions also place this schedule early in the order: “Otherwise, complete Schedule D (Form 8995-A) before beginning Schedule A.” See Schedule A.
Where it goes and next steps
The form itself says “Attach to your tax return.” The instructions give no separate due date or mailing address for the schedules, so they travel with the return that carries Form 8995-A.
The cooperative side of the deduction also appears on the form: line 38 reads “DPAD under section 199A(g) allocated from an agricultural or horticultural cooperative.” Return to Form 8995-A for the full line walk.
Where this comes from
The editions read for this page are Form 8995-A (2025) and the Instructions for Form 8995-A (2025), which are the revisions irs.gov served when they were read on 2026-10-19; check the revision printed on the form you file, because a later revision can change the lines, thresholds and due dates. This page describes Form 8995-A (2025), Qualified Business Income Deduction, with Schedules A, B, C and D; Instructions for Form 8995-A (2025), as served on irs.gov on October 19, 2026. The IRS can revise a form after we read it, and the form you file and its own instructions control. General information, not tax or legal advice.
Common mistakes
- Treating the reduction as a flat charge. The instructions say it is “the lesser of:” two limbs, not both.
- Assuming only high earners use the form. The form says “or you’re a patron of an agricultural or horticultural cooperative.”
- Applying the 9% to all QBI. The instructions limit it to “9% of QBI allocable to qualified payments from a specified cooperative”.
- Expecting a cooperative to file it. The instructions say “Cooperatives don’t file Form 8995-A”.
Related: Form 8995-A instructions, Form 8995, the simplified computation, Form 1040 line 13 qualified business income, Form 1099-DIV box 5 Section 199A dividends, Schedule K-1 (Form 1065) box 20 code Z, and Schedule K-1 (Form 1120-S) box 17 code V.
Sources
- Form 8995-A (2025), Qualified Business Income Deduction, with Schedules A, B, C and D: https://www.irs.gov/pub/irs-pdf/f8995a.pdf
- Instructions for Form 8995-A (2025): https://www.irs.gov/pub/irs-pdf/i8995a.pdf
Read from the IRS pages linked above on October 19, 2026. General information, not tax or legal advice. The IRS form and the instructions for your own form control, and your own facts decide the outcome.