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How to enter New York PTE tax in ProConnect Tax

by ProConnect Tax Online Updated 3 months ago

PTET returns, payments, and extensions can only be filed through New York State Online Services at this time. Visit the Department of Taxation and Finance for more information. Follow these instructions once the PTE is already paid.

Table of contents:

To claim the credit on an individual return:

  1. On the left-side menu, select State & Local.
  2. Click on Other Credits.
  3. Select the NY Credit Forms screen.
  4. Scroll down to the Pass-through Entity Tax Credit (IT-653) section at the bottom of this screen.
  5. Enter the following information in the table provided:
    • Name of Entity
    • Employer ID number
    • PTET credit amount

The PTE credit will flow to form IT-201, line 71, as a refundable credit. The program will automatically add-back the credit amount on form IT-225, code 219.

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To indicate PTE was paid on a partnership return:

  1. On the left-side menu, select Schedule K-1.
  2. Click on the Schedule K-1 Miscellaneous screen.
  3. After selecting the partner, scroll down to the New York Information section.
  4. Check the box labeled Elect to pay the pass-through entity tax (PTET) for the current year.
  5. Enter a 1 0r 2 in Residency status assigned for purposes of computing PTE taxable income: 1 = resident, 2 = nonresident.
  6. Repeat these steps for each applicable partner.
  7. On the left-side menu, select State & Local.
  8. Click on Credits.
  9. Select the NY State Credits screen.
  10. Scroll down to the Other Credit Bases section.
  11. Enter the total PTET paid for all partners in NY State pass-through entity tax (PTET) credit.

The PTET will print on form IT-204, lines 144a-f, with code 653.

To allocate the credit to specific partners:

Use the state's Partnership PTET Worksheet to determine the amount of credit each partner can claim.

  1. From along the top of the workspace, select the Special Allocations tab.
  2. In the upper-left corner, use the drop-down menu to select NY.
  3. Under Amounts to Allocate, select NY State PTET paid.
  4. Allocate appropriate credit amount to each partner.

The partners' credits will flow to IT-204-IP, lines 47a-47f, with code 653.

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For S-corporate returns:

Unlike partnerships, the CT-34 and CT-34-SH don't have a specific question or line where you can indicate PTET.

However, the form instructions state that you must provide a statement to each shareholder listing their pro rata share of:

  • pass-through entity taxable income, and
  • direct share of PTET credit.

To generate statements with the required information:

  1. On the left-side menu, select State & Local.
  2. Click on Schedule K.
  3. Select the NY Schedule K screen.
  4. Scroll down to the Pass-Through Entity Tax (PTET) section.
  5. Enter the totals for all shareholders in New York State PTET credit and Income.

ProConnect Tax will use the shareholders' stock ownership to calculate their pro rata share of PTE taxable income and credit, which prints in part 2 of the New York Shareholder Summary. If you need to adjust these amounts:

  1. On the left-side menu, select State & Local.
  2. Click on Schedule K-1.
  3. Select the NY Schedule K-1 Overrides screen.
  4. Scroll down to the Pass-Through Entity Tax (PTET) section.
  5. Enter this shareholder's portion of New York State PTET credit and Income.
  6. Repeat these steps for each shareholder.

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For Fiduciary returns:

  1. From the Input Return tab, go to State Other Credits NY Other Credits.
  2. Under the Refundable Credits section, fill out the fields in the Pass-through entity tax credit (IT-653) subsection, adding rows as needed:
    • Name of entity
    • Employer ID number
    • PTE credit amount
    • PTET NYC credit amount

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