Utah law allows eligible entities to elect to be taxed at the entity level which then allows the "Final PTET" to take a credit on their individual return for taxes paid. The Final PTET, Final pass-through entity taxpayer, is a "...member of an LLC, partner of a partnership, shareholder of an s-corporation, or beneficiary of an estate or trust. A Final PTET does not include a business entity or an estate or trust."

The election is made online by filing Form TC-75, and making payments through Utah website. The election must be made on or before the last day of the PTE's taxable year.

The election can be made annually and cannot be revoked once made for the tax year. Individual members of a PTE cannot opt-out of the election if the PTE has made the election and paid the tax.

Quarterly estimated payments are not required. Payments are not available through Drake Tax Online.

1065

In Drake Tax Online, record the amount paid online by using one of these options.

• Go to the States tab and click the Utah drop-down. Open the Distributable Pro Rata Share Items for K1 screen. From the line 17 Name drop-list, select AP Credit for Voluntary Tax Paid and enter an amount.

• Go to the States tab and click the Utah drop-down. Open the Schedule K-1 – Partner Information screen. From the line 17 Name drop-list, select AP Tax Paid by Pass-Through Entity (PTE) and enter an amount.

When you view the return, the amount is shown on both:

• UT TC65-K, line 17, Code AP

• UT TC65-K1, line 17, Code AP

1120-S

In Drake Tax Online, record the amount paid online by using one of these options.

• Go to the States tab and click the Utah drop-down. Open the Distributable Pro Rata Share Items for K1 screen. From the line 18 Description drop-list, select AP Tax Paid by Pass-Through Entity (PTE) and enter an amount.

• Go to the States tab and click the Utah drop-down. Open the Schedule K-1 – Shareholder Information screen. From the line 18 Nonrefundable credit drop-list, select AP Tax Paid by Pass-Through Entity (PTE) and enter an amount.

When you view the return, the amount is shown on both:

• UT TC-20S, Sch K, line 18, Code AP

• UT TC-20S, Sch K-1, line 18, Code AP

1041

In the Drake Tax Desktop integration, record the amount paid online by going to UT > screen 2 > and entering the amount for code AP.

When you view the return, the amount is shown on both:

• UT 41, Sch K, Line 13, Code AP

• UT 41, Sch K-1, Line 13, Code AP

1040

In Drake Tax Online, enter the credit amount as follows:

1. Go to the States tab and click the Utah drop-down.

2. Open the TC-40A – Income Tax Supplemental Schedule screen.

3. Enter the amount on the Tax Paid on Behalf of a Pass-through Entity Taxpayer Code 67 line.

4. Go back to the States tab and click the Utah drop-down.

5. Open the TC-40A – Income Tax Supplemental Schedule – Page 2 screen.

6. Enter the amount on the Tax Paid by Pass-Through Entity (PTE) AP line.

When you view the return, the amount is shown on both:

• UT TC-40A, Part 1, Code 67

• UT TC-40A, Part 4, Code AP

Per the Utah FAQ page:

"An individual who is a Final PTET will file their Utah return as normal with two minor changes.

TC-40A - Income Tax Supplemental Schedule - Part 1 - Additions to Income

Enter the total of all state income taxes paid by any PTE to Utah and any other state for the year that were not included in the federal adjusted gross income calculated on the individual’s federal return. Enter the amount using code: 67 - Tax Paid on Behalf of a Pass-Through Entity Taxpayer.

TC-40A - Income Tax Supplemental Schedule - Part 4 - Nonapportionable Nonrefundable Credits

Enter the nonrefundable credit as reported on the Utah Schedule K-1 for taxes paid by the PTE. Enter the credit using code: AP - Pass-through entity taxpayer income tax credit."

Related Links

Drake Tax - UT - SALT Deduction Workaround (PTET)