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How to enter Kentucky PTE in ProConnect Tax

by Intuit Updated 3 months ago

Starting in tax year 2022:

  • Starting in March 2023, pass-through entities can elect to pay it's tax liabilities on behalf of it's individual partners, members, or shareholders for tax years beginning on or after January 1, 2022. This was retroactive for tax year 2022 returns.
  • For taxable years beginning on or after January 1, 2023, an authorized person must file Form 740-PTET to make the election.
  • For additional information, see the department's FAQ's.

Down below we'll go over how to enter PTE for Kentucky on Individual, Partnership, and S-Corporate returns in ProConnect Tax.

Select your tax type:

Individual

  1. Go to Input Return Income Passthrough K-1's.
  2. Select the K-1 that needs the PTET-CR information entered.
  3. Select the State & Local tab.
  4. Scroll down to (EF ONLY) Kentucky Form PTE-WH (Form 740-NP only)/Form PTET-CR
  5. Check the Form PTET-CR checkbox.
  6. Complete the following fields if applicable:
    • KY LLET account number.
    • Distributive share amount of income subject to withholding.
    • Tax before credit amount.
    • Distributive share of credits amount.
    • KY taxes withheld/paid by entity
  7. Go to Input Return State & Local Other Credits.
  8. Select Kentucky Schedule ITC.
  9. Scroll down to Kentucky Refundable Credits.
  10. Enter any Refundable pass-through entity tax credits from Form PTET-CR.

Back to Table of ContentsPCG_ASSET_spacer_11px.pngA black and white photo of a street light.

Partnership

The KY Form PTE will generate automatically but tax will not be calculated on it until the election is made. If the Partnership would like to Elect to pay income tax at the entity level and generate the Form 740-PTEP:

  1. Go to Input Return State & Local Adjustments and select KY Adjustments.
  2. Scroll down to the KY Pass-Through Entity Tax (Form 740-PTET)/KY NR Income Tax Withholding on Net Distributive Share Income Report (Form 740NP-WH) section.
  3. Check the box Form 740-PTET Only.
  4. This will suppress the Form 740NP-WH and generate the 740-PTET.
  5. The PTET-CR will generate for each Partner showing the Kentucky income tax paid by the entity.

Additional information may be needed for amended returns, estimated tax payments, and overpayment crediting options.

In the event that the partnership receives a credit on a K-1:

  1. Go to Input Return Schedule K Passthrough K-1's.
  2. Select the State & Local tab.
  3. Scroll down to Kentucky LLET Pass-Through Items and enter the information.

Back to Table of ContentsPCG_ASSET_spacer_11px.pngA black and white photo of a street light.

S-Corporation

The KY Form PTE will generate automatically but tax will not be calculated on it until the election is made. If the S Corporation would like to Elect to pay income tax at the entity level and generate the Form 740-PTEP:

  1. Go to Input Return State & Local Adjustments and select KY Adjustments.
  2. Scroll down to Kentucky Form 740-PTET and 740NP-WH.
  3. Check the box Form 740-PTET Only.
  4. This will suppress the Form 740NP-WH and generate the 740-PTET.
  5. The PTET-CR will generate for each shareholder showing the Kentucky income tax paid by the entity.

Additional information may be needed for amended returns, estimated tax payments, and overpayment crediting options.

In the event that the partnership receives a credit on a K-1:

  1. Go to Input Return Schedule K Passthrough K-1's.
  2. Select the State & Local tab.
  3. Scroll down to Kentucky LLET Pass-Through Items and enter the information.

Back to Table of ContentsPCG_ASSET_spacer_11px.pngA black and white photo of a street light.

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