The New York State Department of Taxation and Finance has provided guidance regarding the reporting of PTET (pass-through entity tax) on New York Scorporation Form CT-34-SH, page 1, line 1.
Prepare a statement itemizing the amounts paid to each state showing the shareholder’s share of any PTET deducted by the entity for the current year in excess of the PTET liability.
Include the following taxes to the extent the tax was excluded from federal income [(Article 22 section 612(b)(3)]:
- Article 9-A corporate franchise tax; any amounts paid on behalf of members or shareholders to states that are not substantially similar to New York’s PTET;
- any amounts paid on behalf of NY nonresidents for pass-through entity taxes that are substantially similar to New York’s PTET;
- any amounts paid on behalf of NY residents for pass-through entity taxes that are substantially similar to New York’s PTET on income not sourced to the other state under the laws of New York;
- and any amount of estimated PTET deducted by the S corporation that exceeds the actual PTET liability for the year.
Do not include the amount of the PTET liability computed on the annual PTET return. This amount will be an addback modification by the shareholders claiming the PTET credit.
Next Steps in ProConnect Tax
If any of the update impacts your return, then the return has been updated.
If you have already filed, and the update affects a calculation previously reported, file an amended return.
- Override Form CT-34-SH, line 1 by going to State & Local > Schedule K > NY schedule K screen, using the field, NY franchise tax imposed under Article 9-A [Override], in the Part I - Addition to Income section.
- Attach a PDF in General > Electronic Filing > e-file Attachment screen as 39 = Other Attachment
