PTE State Tax Deduction

[Jayruss715]

Spidell has made a compelling argument that the federal tax deduction for PTE payments paid in 2022 cannot be accrued on the 2021 tax returns (cash or accrual basis, CA state income taxes can be accrued for cash basis taxpayers)  Lacerte continues to reduce federal income on the 2021 tax returns for PTE payments to be paid in 2022.  Is there any further guidance allowing the accrual of the PTE payments in alignment with the state tax credit regardless of the year the PTE payments are paid?

[Chuck56]

• Why is Lacerate reducing the 2021 federal income for the state PTE tax to be paid in 2022?

[Jayruss715]

it is reducing the federal if you are using the State Accrual function.  We are not able to figure out why or find any source that says this is ok.

[sjrcpa]

There is no specific authority that says it is OK. Just general accrual basis rules.

There is no specific authority that says it is not OK.