How to enter Alabama PTE tax in ProSeries

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:

To claim the credit on an individual return:

1. Open the Alabama return.
2. Open the Schedule CP.
   1. Press F6 to bring up Open Forms.
   2. Type CP and press OK.
3. Complete the table on Section A.

The credit will flow to line 26 of Form 40.

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To generate PTE for a partnership:

1. Open the Alabama Partnership return.
2. On the Alabama Partnership Information Worksheet scroll down to Part VIII.
3. Check the box for Electing Pass-Through Entity Tax.
4. If subject to estimated taxes, enter any payments already made.
5. Open the Form EPT.
6. Review the calculations and make any adjustments as needed.
7. If you plan on e-filing the Form EPT go to the Federal Partnership Information Worksheet.
8. In the e-file selection table check the Alabama Form EPT checkbox.
9. When e-filing select both the regular state return, and the Alabama Form EPT.

This will flow to the EPT-K1.

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To generate PTE for an S corporation:

1. Open the Alabama S Corporation return.
2. On the Alabama S Corporation Information Worksheet scroll down to Part VII.
3. Check the box for Electing Pass-Through Entity Tax.
4. If subject to estimated taxes, enter any payments already made.
5. Open the Form EPT.
6. Review the calculations and make any adjustments as needed.
7. If you plan on e-filing the Form EPT go to the Federal S Corporation Information Worksheet.
8. In the e-file selection table check the Alabama Form EPT checkbox.
9. When e-filing select both the regular state return, and the Alabama Form EPT.

This will flow to the Alabama EPT-K1.

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To add the Form EPT instructions to the client letter:

1. Open the Federal Partnership or S Corporation return.
2. From the Tools menu, select Letters, then Manage Client Specific Letters.
3. Create new letter if you do not yet have one and select the Standard Client Letter as the Template.
4. Name the letter and select Next.
5. Scroll down to the bottom of the letter, click below [@EndStateText].
6. From the Insert menu select Page Break.
7. On the right side of the screen select the State Paragraph tab.
8. Under Alabama double click on Form EPT to add the filing instructions to the letter.
9. From the File menu, select Exit Letter. Choose Yes when prompted to save.

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