Another aspect to consider when making the election is whether the PTET paid to a state is refundable at the owner or pass-through level. Some states, such as New York, allow for the credits to be refunded while other states, such as California, only allow for credits...
Pass-through owners receive a credit against their tax liability (corporate business tax or personal income tax) equal to 87.5% of their share of the PTET paid by the entity. Previously, this percentage was 93.01%, which was the mathematical percentage needed to make, in theory...
Currently, the Internal Revenue Code (IRC) places significant limitations on state tax deductions for individuals. California’s new law provides a workaround to this limitation by allowing a PTE to make an election to pay California income tax at the entity level. Specifically, the election creat...
Virginia released updated guidelines on its pass-through entity tax to address legislation enacted last year as well as for S corporations with resident and nonresident owners. Assess the impact: The new guidelines are intended to provide pass-through entities with a workaround to the $10,000 lim...
Considerations for pass-through entity legislationNew York’s pass-through entity tax (PET) imposes an income tax directly on the pass-through entity as opposed to the partners, members, or shareholders. What should you consider when deciding whether or not to elect into the New York PET ...
through Entity (“PTE”) Tax. This new tax is enacted as a work around to the $10,000 state and local tax (“SALT”) deduction limitation, which was implemented under the Tax Cuts and Jobs Act (“TCJA”). Since state income tax is imposed directly on the Pass-through...
Pass-through entities and their owners will need to assess the benefits of making the pass-through entity taxation election. A tax professional with in-depth expertise in these areas can help your businesses model benefits and costs of the election on a state-by-state basis to determine whether...
Billing Data.LastPass utilizes third-party payment processing providers to process payments made through our websites. Where required for regulatory, legal, tax compliance, or customer support purposes, we store partial payment information (such as the expiration date and last four digits of your cre...
turning employees in to an independent contractor relationship with an employee-owned pass-through is the biggest gift an employer can give. The employee gets to exempt 20% of income from federal tax; other than transaction costs, the employer is not seriously inconvenienced. Seems like a win-...
“Fixed Season Pass” means a season pass that gives the holder a fixed number of days to use the pass throughout the season, usually ranging from one(1)to ten (10) days. A list of Fixed Season Passes can be foundhere. “General Season Pass” means a season pass that is not limited...