Nys ptet ( pass thru entity tax)

[BOB W]

Any advice about electing in for this NYS work around for SALT limitation? October 15th is the deadline to make an estimated tax payment for pass through entities for 2021 tax year.

[Lion]

I the partners/shareholders always max out their $10,000 cap on their personal returns, they will probably elect for their partnership/S-corporation to pay the NYS PTET. Explain it to your clients, including the looming deadline, and let them make informed decisions. Maybe include a link to an official NYS explanation &/or to a good published explanation.

From the NYS Department of Taxation and Finance:

Deadline approaching to opt in to pass-through entity tax (PTET)

Reminder: If you wish to participate in the optional PTET for 2021, the deadline to opt in is October 15, 2021.

To opt in:

1. Log in to your S corporation's or partnership’s Business Online Services account. (If the business doesn’t have an account, we recommend creating one by October 8 to avoid missing the election deadline.)
2. Select the ≡ Services menu in the upper left corner of your Account Summary homepage.
3. Choose PTET web file from the Corporation tax or Partnership tax expanded menu, then select Pass-through entity tax (PTET) annual election.

Reminder: Tax professionals cannot make the election on behalf of their clients.

https://www.tax.ny.gov/bus/ptet/

[BOB W]

Thanks Lion. I looks like for the 2021 year the one and only payment will be allowed on December 15th after making the opt-in election on October 15th.

While every return is different, most of my joint filers are better with the standard deduction. This work around Salt issue seems to be better regardless, if they have a qualified passthrough entity.

[Lion]

https://www.tax.ny.gov/bus/ptet/

Estimated payments

Tax year 2021

An electing entity is not required to make any estimated tax payments for the PTET. However, it may choose to make optional online estimated tax payments prior to December 31, 2021. An online estimated tax application for the PTET will be available by December 15, 2021.

If an electing entity chooses to make optional estimated tax payments for tax year 2021, personal income tax estimated payments must still be made by or on behalf of partners, members, or shareholders under Article 22 calculated as if they were not entitled to the PTET credit. Personal income tax estimated payments are not considered prepayment of the PTET and may not be applied to the PTET liabilities.

Note: An electing entity cannot make estimated tax payments after filing a return.

[BOB W]

To clarify, a reduction of personal estimated tax payments can be done and use that amount to pay PTET through NYS Business web site?