Beginning with the 2022 taxable year, taxpayers wanting to make election for 2022 tax year must make a pre-payment by June 15, 2022.

The amount due by June 15 is at least the greater of:

  • 50% of the elective tax paid for the prior year;
  • $1,000.

 Entities that did not elect to pay PTE in 2021 will pay $1,000 on June 15 to preserve the right to make the election for 2022. Entities that have elected PTE for 2021 tax year, or plan to elect if on extension, must pay in at least 50% of the final 2021 PTE tax liability. If the 2021 return is on extension, taxpayers should consider making a larger than needed estimate to provide a cushion and ensure that their estimate is equal to 50% of 2021 final PTE tax liability. There are no exceptions to the 50% of prior-year tax requirement for the June 15 payment, even if income is expected to decrease. If the June prepayment is underpaid, then the taxpayer is ineligible to make the election for that taxable year. (R&TC §19904) The June 15 payment deadline applies to both calendar- and fiscal-year taxpayers.

The remaining 2022 PTE amount is due by the entity’s original filing date deadline (March 15 for calendar-year taxpayers). If you have questions, please contact your Linkenheimer CPA.