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    Vikram rajput
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    36 states and 1 locality have enacted pass-through entity (PTE) level taxes since the limitation on state and local tax deductions under the Tax Cuts and Jobs Act. These PTE taxes allow businesses organized as pass-through entities like partnerships or S-corps to pay taxes at the entity level rather than having the income passed through to owners' individual returns. The effective years for these PTE taxes range from 2018 to 2023 depending on the state. Three additional states have proposed PTE tax bills but have not enacted them yet. Nine states have no personal income tax on PTE income.

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    36 states and 1 locality have enacted pass-through entity (PTE) level taxes since the limitation on state and local tax deductions under the Tax Cuts and Jobs Act. These PTE taxes allow businesses organized as pass-through entities like partnerships or S-corps to pay taxes at the entity level rather than having the income passed through to owners' individual returns. The effective years for these PTE taxes range from 2018 to 2023 depending on the state. Three additional states have proposed PTE tax bills but have not enacted them yet. Nine states have no personal income tax on PTE income.

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    © All Rights Reserved
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    50 views2 pages

    Pte Map

    Uploaded by

    Vikram rajput
    36 states and 1 locality have enacted pass-through entity (PTE) level taxes since the limitation on state and local tax deductions under the Tax Cuts and Jobs Act. These PTE taxes allow businesses organized as pass-through entities like partnerships or S-corps to pay taxes at the entity level rather than having the income passed through to owners' individual returns. The effective years for these PTE taxes range from 2018 to 2023 depending on the state. Three additional states have proposed PTE tax bills but have not enacted them yet. Nine states have no personal income tax on PTE income.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    of 2

    States with Enacted or Proposed Pass-Through Entity (PTE) Level Tax

    As of July 20, 2023

    36 states (& 1 locality) that enacted a PTE tax


    WA since TCJA SALT deduction limitation, effective
    for 2021 (or earlier) unless noted:
    MT ND ME AL, AR1, AZ1, CA, CO3, CT4, HI2, GA1, IA1, ID, IL,
    OR VT IN1, KS1, KY1 (& KY) ,LA, MA, MI, MD, MN, MO1,
    MN
    ID NH MS1, MT2, NC1, NE3, NJ, NM1, NY, OH1, OK, OR1,
    SD WI NY, MA RI, SC, UT1, VA, WI, WV1, and NYC1
    WY NYC CT
    MI RI 1 Effective in 2022
    IA PA NJ 2 Effective in 2023 or later
    NV NE
    OH 3 Retroactive to 2018
    MD
    UT IL IN DE
    4 Mandatory 2018-2023, elective starting 2024
    CA CO WV
    VA
    KS MO DC
    KY 3 states with proposed PTE tax bills:
    NC
    ME - LD 1891 introduced
    TN
    AZ OK PA – SB 659 and HB 1584 introduced
    NM AR SC
    GA
    VT – SB45 passed Senate, in House
    MS AL
    AK
    TX
    LA 9 states with no owner-level personal
    income tax on PTE income:
    HI AK, FL, NH, NV, SD, TN, TX, WA, WY
    FL

    3 states with an owner-level personal


    income tax on PTE income that have not
    yet proposed or enacted PTE taxes:
    DC, DE, and ND
    Current PTE tax workarounds (36 states and 1 locality)
    • State

    State Effective Year State Effective Year


    Alabama 2021 Minnesota 2021
    Arizona 2022 Mississippi 2022
    Arkansas 2022 Missouri 2022
    California 2021 Montana 2023
    Colorado 2018 (retroactive) Nebraska 2018 (retroactive)
    Connecticut 2018 (mandatory 2018-2023, New Jersey 2020
    elective starting 2024) New Mexico 2022
    Georgia 2022 New York 2021
    Hawaii 2023 New York City 2022
    Idaho 2021 North Carolina 2022
    Illinois 2021 Ohio 2022
    Indiana 2022 (retroactive) Oklahoma 2019
    Iowa 2022 (retroactive) Oregon 2022
    Kansas 2022 Rhode Island 2019
    Kentucky 2022 (retroactive) South Carolina 2021
    Louisiana 2019 Utah 2022
    Maryland 2020 Virginia 2021
    Massachusetts 2021 West Virginia 2022
    Michigan 2021 Wisconsin 2018

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