For a LLC that paid NY State PTET for its LLC members its my understanding that Form IT-204-IP should show the amount of PTET in box 47a, with code 653, and an amount.
2 questions:
1) How do I enter that amount into turbo tax? I've found the spot of box 47a on the individual member's forms but Turbo Tax won't let me enter a value there, possibly because it needs to flow to that box from another entry point? I can't figure out what that entry point may be.
2) Is the amount that should go in box 47a with code 653 the amount of PTET paid in 2022 or the amount of PTET tax that should have been paid? In my example let's say there are two 50% ownership members (both NY state residents) PTET taxes paid during 2022 was $4000 total but the amount that needed to be paid was only $1000. In this case would $2000 go in box 47a or $500? (The amounts are 50% of the total since each member just gets 50% of the allocation).
I am using Turbo Tax Business on windows. Thank you.
The reporting for NY PTET is a bit cumbersome to say the least. There are various forms that need to be utilized to properly report the credit and how it navigates within the TurboTax programs. For those partners who use TurboTax for their personal returns they will need to use the desktop version to receive the credit(s). You may want to add that in a side note for any partners that use TurboTax for their own purposes.
The following should assist you in entering the data necessary:
To claim the credit on a 1040 Using TurboTax Desktop:
Select the Forms menu, then click Open Form.
Type in 653 to highlight form IT-653 on the list. Press OK.
Enter the entity name, EIN, and PTET credit amount for each K-1.
The PTE credit will flow to form IT-201, line 71, as a refundable credit. The program will automatically add-back the credit amount on form IT-225, code 219.
To indicate PTE was paid on a 1065:
Open the Sch K-1 Summary.
Scroll down to item Q, "Did the partnership elect to pay the pass-through entity tax?"
Check Yes.
Check the Resident or Nonresident box.
You may want to include the amount of PTE paid on this partner's behalf under Supplemental Information, since it's not reported elsewhere on the NY K-1.
To indicate PTE was paid on an 1120-S:
Open the CT-34-SH, p1-3.
Scroll to the S Corporation Amounts for Shareholders Smart Worksheet at the bottom of the form.
Enter the total Pass-through entity taxable income for all shareholders.
Enter the total PTET credit to be claimed for all shareholders.
The shareholder's portion of PTET taxable income and credit will transfer to their Schedule K-1 Equivalent as supplemental information.
Instructions for Form IT-204-IP