Quick Survey for Pass-Through Business Owners:
- Are you aware of Georgia’s Pass Thru Entity Tax (PTET) Election?
- If PTET is something your business should consider for 2022?
- Do you know if PTET will save you money?
The Tax Cuts and Jobs Act of created a $10,000 cap on itemized deductions of state and local tax (“SALT”) – including income taxes, real property taxes, personal property taxes and sales/use taxes – for tax years beginning after December 31, 2017, and before January 1, 2026.
Subsequently a number of states and municipalities have enacted laws designed to tax pass-through entities at the entity level as opposed to having individuals deduct them on their personal returns, thereby allowing PTEs to make an election to pay taxes and circumvent the $10,000 state tax SALT limitation.
Determining which businesses are best suited to capture advantages under Georgia’s Pass-Through Entity Tax Election (PTET) is a complex matter that should be discussed with your CPA.
If your CPA has not already addressed this election with you, now may be the time to ask yourself: Is your CPA staying up to date on new tax law and actually looking for money saving opportunities rather than being reactive and only filling in the blanks?
The savings associated with a PTET election can be significant and it’s not too late to make changes for 2022.