Pass-Through Entity (PTE) Elective Tax and Payment InformationDecember 2021 Tax News
Web Pay Available for PTE Elective Tax
In the September and October edition of Tax News, we provided two consecutive articles for Pass-Through Entity (PTE) Elective Tax, which is part of AB 150, commonly referred to as the SALT cap workaround.
On November 1, 2021, Franchise Tax Board (FTB) published PTE Elective Tax Payment Voucher (FTB 3893) on our website. Partnerships and S corporations may use FTB 3893 to make a PTE elective tax payment by printing the voucher from FTB’s website and mailing it to us. See instructions attached to voucher for more information.
Alternatively, the PTE elective tax payment can be made electronically using Web Pay on FTB’s website. Entities can use Web Pay to pay for free, and to ensure the payment is timely credited to their account.
To make the elective tax payment, taxpayers must make payments as follows:
- • For taxable year 2021, the elective tax payment must be made on or before the original due date of the tax return.
For taxable years 2022 to 2025 use the following table:
|On or before June 15th of the taxable year of the election||Payment 1
Pay $1,000 or 50% of the elective tax paid in the prior taxable year, whichever is greater.
|On or before the due date of the original return without regard to extensions||Payment 2
Pay the remaining amount.
Payments are not yet available to be displayed in MyFTB accounts. If your client makes a PTE elective tax payment before January 2022, please wait until January 2022 to verify it has posted to their account if using MyFTB to view.
Beginning January 2022, these payments will be shown in two places within the PTE’s MyFTB account:
- Payment History – This page will list the date, amount, and account period for the payment.
- Estimate Payments & Credits – This page will include PTE elective tax payments, along with estimates, extensions, and credits that can be claimed on the entity’s tax return.
MyFTB does not display the amount of credit the owner of the PTE can claim on their 2021 individual income tax return. The credit amount will be included on the Schedule K-1 (100S, 541, 565, or 586) the owner receives from the PTE.