How to enter Hawaii PTE in Lacerte

This article will help you report the elective pass-through entity tax (sometimes called PTE, PTET, PET, or SALT workaround) and the resulting credit.

Table of contents:

Individual

For tax year 2023 PTE Credits are nonrefundable credits that may not be carried forward. Starting in tax year 2024 PTE credits are nonrefundable tax credits that may be used as a credit against taxes in subsequent years until exhausted.

For Partners:

1. Go to Screen 20.14 Partnership Information
2. From the Sections list select Line 15 - Credits and Withholding.
3. Scroll down to the Hawaii Pass-Through Entity (PTE) Credit lines.
4. Enter the amount of credit under PTE elective tax credit {HI}.
5. If the PTE is for the spouse check the box Attribute PTE credit to spouse {HI}.
6. Form N-362 will now generate, line 6 will show the amount applied to this year. Line 7 will show the amount carried over.

For Shareholders

1. Go to Screen 20.2 S Corporation Information
2. From the Sections list select Line 13 - Credits and Withholding.
3. Scroll down to the Hawaii Pass-Through Entity (PTE) Credit lines.
4. Enter the amount of credit under PTE elective tax credit {HI}.
5. If the PTE is for the spouse check the box Attribute PTE credit to spouse {HI}.
6. Form N-362 will now generate, line 6 will show the amount applied to this year. Line 7 will show the amount carried over.

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Partnership

To make the annual election for Hawaii PTE Tax and activate the credit:

1. Go to Screen 43.422 Hawaii Form N-362E.
2. Under Hawaii Form N-362E enter a 1 or 2 to indicate who signed the election.
   • If signed by a responsible party enter their information under Responsible Party.
3. The Sch PTE will now generate to show the calculations.
4. Each partners portion of the credit will show on the Sch K-1 line 28.

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S-Corporation

To make the annual election for Hawaii PTE Tax and activate the credit:

1. Go to Screen 49.421 Hawaii Pass-Through Entity Tax Election N-362E.
2. Under Hawaii Form N-362E enter a 1 or 2 to indicate who signed the election.
   • If signed by a responsible party enter their information under Responsible Party.
3. The Sch PTE will now generate to show the calculations.
4. Each shareholder portion of the credit will show on the Sch K-1 line 16m.

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