New York State Pass-Through Entity Tax (PTET)
New York State has enacted a workaround for the $10,000 state and local tax deduction limitation for the year tax year 2021. The workaround is only eligible for Partners in Partnerships, not publicly traded, and Shareholders in S Corporations.
In order to take advantage of this workaround, the Partnerships and S Corporations have to make an election and pay New York State income taxes on behalf of the Partners or Shareholders. By doing this, the entity is able to deduct those tax payments as a federal deduction from income.
The election for the tax year 2021 has to be made on or before October 15, 2021 via the State’s website. For cash basis taxpayers to take advantage of the deduction in 2021, the tax payments should be paid before December 31, 2021.
Federal and New Jersey Tax Relief for Ida Victims
The IRS and New Jersey Division of Taxation have announced relief for individuals and businesses impacted by Tropical Storm Ida. Return filings and payments that are due between September 1, 2021 January 2, 2022 have been extended to January 3, 2022. The relief is available to the ten counties currently included in the Federal Emergency Management Agency (FEMA) major disaster declaration: Bergen, Essex, Gloucester, Hudson, Hunterdon, Mercer, Middlesex, Passaic, Somerset and Union. Other states are also eligible for relief with more being added, it seems, daily.
Article Submitted by – Joseph P. Marino, CPA