Common Questions regarding Mississippi Pass-through Entity Election with a 1065 return using CCH® ProSystem fx® Tax and CCH Axcess™ Tax.

  • Article Type:
  • QA
  • Last Modified:
  • 04/24/2023

Question

What are some common questions and answers regarding Mississippi Pass Through Entity Tax with tax year 2022?

Environment

  • CCH® ProSystem fx® Tax
  • CCH Axcess™ Tax
  • Partnership - 1065
  • Mississippi - MS

Answer

QuestionAnswer
 Form Name
  • 84-381
  • 84-105
-State Links
Election for PTE
-Is an Election Required?
  • Yes, the state of Mississippi does not automatically elect any entity to be taxed as an electing pass-through entity.
-Made when?
  • Both the election to become an electing pass-through entity (“electing PTE”) and the revocation of that election is made by submitting the Pass-Through Entity Election Form, form 84-381, to the Department of Revenue on or before the fifteenth day of the third month following the close of the taxable year for which the entity elects to be taxed as an electing pass-through entity, or for which the entity elects to no longer be taxed as an electing pass-through entity.
-Good for?
  • The election shall be binding for the taxable year and all subsequent taxable years unless the election is revoked by the electing pass-through entity.
-How do we make this election?
  • Both the election and revocation of the election shall be accomplished by vote or written consent.
-Separate Form needed?
  • 84-381
-Option  to Opt-Out?
  • No, all must be included. The option to revoke the pass-through entity election is located on the 84-381 and is made by marking the "Removing PTE" box. Input on Mississippi > Composite Return worksheet > Section PTE Election Form > Line 13 - Electing / revoking PTE
    • Interview Mississippi > MS13, box 142.
Generation of State PTE Return
 How do we generate the form above?
  • To generate the 84-381, use Mississippi > Composite Return worksheet > Section PTE Election Form > Lines 1-13
    • Interview Mississippi > MS13 boxes 130-142.
  • For the 84-105, to elect the pass-through entity at the partner level, use Common State/City > State PTE Generation > State PTE Return Generation > Mississippi - Generate State PTE return.
    • Interview form PTE-ST1 box 138.
  • Or state input Mississippi > General worksheet > Section Basic Data > Line 14 - Electing pass-through entity
    • Interview Mississippi > MS1 box 31. 
  • For the 84-105, to elect the pass-through entity at the pass-through level, use the Mississippi > Schedule K-1 From Passthrough worksheet > use Lookup value in line 1 to link to the Federally input Partnership Passthrough entity
    • Interview Mississippi > MS15 and MS16.
  • 84-105 line 7 - credit amount of tax paid by the lower-tier electing PTE can be input on line 41 of this worksheet
    • Interview Mississippi > MS16 box 80.
 Is this a separate filing from the main form, part of the main form, or filed on it's own?
  • 84-381 must be paper filed.
Estimates
 Are there estimates for this form?
  • Form 84-300 Estimate Vouchers. "Every taxpayer filing a composite return or an electing PTE return with an annual income tax liability in excess of $200 must make estimated tax payments."
  • Control estimate preparation with Mississippi > Payments and Penalties worksheet > section 1 - Estimated Tax Information > Lines 1-10.
    • Interview Form Mississippi MS10, boxes 50-58.
Interest/Penalties
 Do interest/penalties apply?
  • This is calculated as normal using the same method as the main form 84-105.
  • Please review Form 80-320 for calculation if 84-105, line 15 is populated.
Additional PTE Information
  • Common State > State PTE Generation worksheet >Grid 23 
    • (Interview PTE-ST1, boxes 300-364)
 Does this section apply to this state?
  • No.
Additional Input Available
-Does new input options under State and City Tax Refund flow to the state?
  • No.
-Does new input options under Taxes and Licenses flow to the state?
  • No.
-Does new input options under Rent/Royalty flow to the state?
  • No.
-Does the new input options under Farm flow to the state?
  • No.

Note
  • This election will check the 84-105 box for "Electing pass-through entity" and calculate the partner's tax paid by electing pass-through entity on Mississippi form 84-131, column D. The partner's amount of 84-131, column D carries to the partner's 84-132, Part V.
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