NYS PASS-THROUGH ENTITY TAX – Estimated Tax Payment Walkthrough

NYS PASS-THROUGH ENTITY TAX – Estimated Tax Payment Walkthrough

Earlier this year, New York State enacted an optional pass-through entity tax (“PTET”) which can be used as a possible workaround for owners of passthrough entities effected by the $10,000 limitation of State and Local Taxes (“SALT”) passed under the Tax Cuts and Job Act of 2017. The PTE Tax is paid by the S-Corporation, Partnership or Limited Liability Companies that are taxed as Partnerships, and each partner/member is then allowed to take a pro-rata share of that deduction on their individual tax return (not subject to the $10,000 limit).

The key tool available for businesses when it comes to the PTET is their NYS Online Services Account. This was the platform where the election to opt-in to the tax was required to be made from by October 15, 2021. And now NYS has added another function to businesses’ accounts: The PTET Estimated Tax Payment System.

In order for businesses and their shareholders or members to take advantage of the benefit of this flow-through tax, an estimated tax payment needs to be made. Estimated tax payments are not required for the 2021 tax year. Any necessary payment is not due until the filing of the return on March 15, 2022.  However, in order for both cash and accrual basis taxpayers to take advantage of the PTET benefit for 2021, an optional estimated tax payment must be made by year-end in order to receive a federal tax deduction.

When making the estimated tax payment, taxpayers have the option to schedule the Estimated Payment up until 12/15/2021. The website unfortunately does not allow the Estimated Payments to be scheduled for payments past 12/15/2021, but taxpayers would still have the option to make the payment the same day on until 12/31/2021.

Using their NYS Online Services Account, the business can follow the below walkthrough presentation in order to make their estimated PTET payment.

Fuller Lowenberg NYS PTET Estimated Payment Walkthrough

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