PTET
Business & Finance abbreviation · Tax
| Stands for | Pass-through entity tax |
|---|---|
| Categories | Business & Finance |
PTET stands for Pass-through entity tax, a tax abbreviation.
Elective state income tax paid at the partnership or S corporation level, which the entity deducts in full on its federal return, letting owners sidestep the federal SALT deduction cap. Owners receive a matching state credit or exclusion.
Example: Electing the PTET saved each partner about $9,000 in federal tax.
Usage notes
More than 30 states adopted PTET regimes after the IRS endorsed the approach in Notice 2020-75.
Related abbreviations
More tax abbreviations
- P45 – Details of employee leaving work (Form P45)
- P60 – End of Year Certificate (Form P60)
- PAN – Permanent Account Number
- PAYE – Pay As You Earn
- PST – Provincial sales tax
- PTC – Premium tax credit
- PTIN – Preparer Tax Identification Number
- QBI – Qualified business income
- QCD – Qualified charitable distribution
- QOZ – Qualified Opportunity Zone
- QSBS – Qualified small business stock
- QSS – Qualifying surviving spouse