Common Questions and answers regarding West Virginia Passthrough Entity Tax (PTE) with a 1065 and 1120S return using CCH® ProSystem fx® Tax and CCH Axcess™ Tax.

  • Article Type:
  • QA
  • Last Modified:
  • 07/31/2023

Question

What are some common questions and answers regarding West Virginia passthrough entity tax with an S Corporation and Partnership return?

    Environment

    • CCH® ProSystem fx® Tax
    • CCH Axcess™ Tax
    • Partnership – 1065
    • S Corporation – 1120S
    • West Virginia - WV
    • Worksheet View – WSV
    • Interview Forms – IVF
    • State And Local Tax – SALT
    • Pass-through Entity Tax – PTET

     

    Answer

    QuestionAnswer
    -Form Name
    • West Virginia Passthrough Entity Tax (PTE)
    -State Links
    Election for PTE
    -Is an Election Required?
    • Yes.
    -Made when?
    • "For calendar year taxpayers, the election is due on or before March 15th. Under Administrative Notice 2023-01, a special rule applies to Tax Year 2022 that requires the election be made between June 8 and September 15, 2023."
    -Good for?
    • N/A
    -How do we make this election?
    -Separate Form needed?
    -Option  to Opt-Out?
    • N/A
    Generation of State PTE Return
    -How do we generate the form above?
    • Common State/City > State PTE Generation > State PTE Return Generation > West Virginia - Generate State PTE return.
    • Interview Form PTE-ST1, Box 258.
    -Is this a separate filing from the main form, part of the main form, or filed on it's own?
    • "The elective pass-through entity tax is a tax imposed directly upon the income of the entity, defined as the resident pass-through entity owners’ income plus the apportioned nonresident pass-through entity owners’ income. The pass-through entity tax is filed and paid instead of the nonresident withholding due with PTE-100Any entity that elects to pay the pass-through entity tax will no longer be obligated to file the PTE-100."
    • See West Virginia Tax Division for more information.
    Estimates
    -Are there estimates for this form?
    -How do we generate them?
    • N/A
      -Can you apply an overpayment from the current year form?
      • N/A
      Interest/Penalties
      -Do interest/penalties apply?
      -Is there an underpayment penalty?
      • N/A
      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

      Additional Information

      • West Virginia Senate Bill 151 became effective on June 8, 2023. This bill created an elective pass-through entity tax retroactive to tax year 2022. It is different from the tax already paid on the PTE-100 as this elective pass-through entity tax is a tax imposed directly upon the income of the entity. This is defined as the resident pass-through entity owner’s income plus the apportioned nonresident pass-through entity owners’ income. The tax paid on the PTE-100 is only on the nonresident withholding due. Any entity that elects to pay the pass-through entity tax will no longer be obligated to file the PTE-100.
      • An election must be made prior to filing the entity pass-through return. This is done by completing the form EPT-100ELF. This election can be made between now and September 15, 20223. CCH is projecting that this form will be available on release 2022-4.1/2022.04010, available July 23rd. No electronic filing will be available for this form as it must be filed through the West Virginia portal. The following website   provides additional information from the state on this election, filing of the form as well as any estimate payments. 

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