UPDATE: New York State Pass-Through Entity Tax

Over the past few weeks, the New York State Department of Taxation has provided updates on Pass-through Entity Taxes (PTET), which are designed to ameliorate the $10,000 limitation on personal state and local tax deductions enacted in the Tax Cuts and Jobs Act of 2017.

New York State first introduced the PTET provisions in the 2021 tax year, based on an election date of October 15, 2021. After year-end 2021, the PTET election will be required on an annual basis due in March.

Other important facts and dates related to the New York PTET include the following:

• For year-end 2022, the New York Pass-through Entity Tax (PTET) elections are due March 15, 2022. There is no extension of this deadline. It is an annual and irrevocable election, and as with 2021 elections, must be made online.
• As with the 2021 election, only an “authorized person” may make this election, through the business’s New York Business Online Services Account. The 2022 election process is the same as the 2021 election process. The New York election is annual. Even if a 2021 election was made, a 2022 election (and each year thereafter) must also be made.
• For a business with a fiscal year-end, the filing year required is for the calendar year in which the fiscal year ends. For example: A fiscal year partnership whose year ends in calendar year 2022 may elect the PTET on a 2022 election , due March 15, 2022.
• New York State has provided a YouTube video to walk taxpayers through the election and filing process
• Both the 2021 PTET return (or extension) and the 2022 election with 2022 first quarter estimated payment are due March 15, 2022, and can be filed using the New York Business Online Services Account.