The New York pass-through entity tax (NY PTET) election for 2021 is due by October 15, 2021 in order for it to apply to the 2021 tax year. Recently, the New York State Department of Taxation and Finance published guidance on the NY PTET, clarifying many open questions on computations, elections, and various other aspects of the PTET.
If your entity has decided to make the NY PTET election, there are a few steps that need to be taken. The entity must be an eligible partnership or S corporation. While partnerships can make the election even if some partners are not eligible, once the election has been made, all eligible partners must be included and cannot opt out.
When making the election, please note that only one of the authorized persons listed below may make this election on behalf of the entity
- Partnership – any member, partner, owner, or other individual with authority to bind the entity or sign returns.
- NY S corporation – any officer, manager, or shareholder, who is authorized under the law of the state where the corporation is incorporated or under the S corporation’s organizational documents, to make the election and who represents to having that authorization under penalty of perjury.
Your tax professional is not an authorized person and is prohibited from making the election on your behalf.
How to Make the Election and opt-in to the NY PTET:
- Log in to (or create) the eligible entity’s Business Online Services account at https://www.tax.ny.gov/online/
- On the Account Summary homepage, select the ≡ Services menu in the upper-left corner.
- Next, choose “Corporation tax” or “Partnership tax” and choose “PTET web file” from the expanded menu.
- Choose Pass-Through Entity Tax (PTET) Annual Election on the Form Selection page.
Once the authorized person has completed and electronically signed the NY PTET election, please forward any confirmations received to your accountant so they have a record of the election.
If you have any questions or need help deciding if electing the NY PTET is right for your entity, please contact your Untracht Early advisor.