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How to enter Maryland PTE tax in ProSeries

by Intuit•1• Updated 3 months ago

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

Table of contents:

‣ To claim the credit on the 1040 return:
‣ To generate PTE on a 1065:
‣ To generate PTE on a 1120S:
‣ Common Questions
   ↳ How to file extensions
   ↳ How to generate PTE forms for 2019 and prior

Starting in tax year 2020 Maryland released a new version of the PTE forms:

  • There's a new version of Form 510, Pass-Through Entity Tax Return.
  • There's a new Form 511, Pass-Through Entity Election Income Tax Return.

MD Senate Bill 787 requires electing entities to adjust taxable income for applicable state and local income taxes. The new Form 511 is reserved for taxpayers electing to remit taxes on all members (electing entities). All other filers that aren't electing entities should file on the updated Form 510. 

These returns are due on September 15.

Before you start

  • By checking the box for Form 511, the taxpayer becomes an “electing entity” and taxes for all members are remitted by the passthrough entity.
  • Checking the box for Form 510 requires the taxpayer to withhold taxes on behalf of nonresident members of the pass-through entity. This mimics prior year treatment for Maryland passthrough entities.

Select the applicable return type below for instructions on generating the Form 510 or Form 511 in ProSeries 2021 and newer:

To claim the credit on an individual return:

  1. Open Maryland return.
  2. Open Form 502CR
  3. Scroll down to Part CC.
  4. Enter the credit on line 6 Flow-through Nonresident PTE tax.

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To generate PTE for a partnership:

  1. Open Maryland return.
  2. Select Maryland Pass-Through Entity for Partnership and click OK.
    • This will open the Maryland Pass-Through Entity Information Worksheet.
  3. Scroll down to Part II - Tax Year and Filing Information section.
  4. Check either the box labeled Form 510, Income Tax Return (withhold only for nonresident members of Maryland) or Form 511, Election Income Tax Return (state tax for members paid and deducted by pass-thru entity).
  5. Complete the form.

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To generate PTE for an S corporation:

  1. Open Maryland return.
  2. Select Maryland Pass-Through Entity for S Corporation and click OK.
    • This will open the Maryland Pass-Through Entity Information Worksheet.
  3. Scroll down to Part II - Tax Year and Filing Information section.
  4. Check either the box labeled Form 510, Income Tax Return (withhold only for nonresident members of Maryland) or Form 511, Election Income Tax Return (state tax for members paid and deducted by pass-thru entity).

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Common questions

Refer to this article for instructions on filing extensions in ProSeries.

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Both the Form 510 and the Form 511 require you to mark checkboxes in order to generate them. If the applicable checkboxes aren't checked, the program will only show the old version of Form 510 and turn off the new forms.

Before you start

  • By checking the box for Form 511, the taxpayer becomes an “electing entity” and taxes for all members are remitted by the passthrough entity.
  • Checking the box for Form 510 requires the taxpayer to withhold taxes on behalf of nonresident members of the pass-through entity. This mimics prior year treatment for Maryland passthrough entities.
  • Taxpayers filing Form 511 should be aware new Maryland legislation signed into law in April of 2021, disallowing some state and local income taxes as a deduction in Maryland.
    • This adjustment doesn't apply to taxpayers filing Form 510.

Select the applicable module below for instructions on generating the new Form 510 or Form 511.

  1. Open the partnership return.
  2. From the File menu, select Go to State/City.
  3. Select Maryland Pass-Through Entity for Partnership and click OK.
    • If you don't see this option, refer to this article for information on downloading new updates and products in ProSeries.
    • This will open the Maryland Pass-Through Entity Information Worksheet.
  4. Scroll down to Part II - Tax Year and Filing Information section.
  5. Check either the box labeled Form 510, Income Tax Return (withhold only for nonresident members of Maryland) or Form 511, Election Income Tax Return (state tax for members paid and deducted by pass-thru entity).
  1. Open the S-Corporate return.
  2. From the File menu, select Go to State/City.
  3. Select Maryland Pass-Through Entity for S Corporation and click OK.
    • If you don't see this option, refer to this article for information on downloading new updates and products in ProSeries.
    • This will open the Maryland Pass-Through Entity Information Worksheet.
  4. Scroll down to Part II - Tax Year and Filing Information section.
  5. Check either the box labeled Form 510, Income Tax Return (withhold only for nonresident members of Maryland) or Form 511, Election Income Tax Return (state tax for members paid and deducted by pass-thru entity).

If you previously filed Form 510 and didn't elect to remit taxes on behalf of all members, Form 510 won't calculate after the release of the ProSeries update with the new version of the form.

If you want to access the prior version of Form 510 that was used to file the return, you'll need to check the box provided on the Maryland Information Worksheet for Form 510. This will generate the old Form 510 used for the previous filing, including all applicable data and calculations.

The previous version of Form 510 is for review or informational purposes only. You won't be able to submit it for paper or electronic filing.

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