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Pass-through entity elections, nexus, and the filing footprint of multi-state operators.

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Tax AlertMay 20267 min read

California PTET Extended Through 2030: Missing the June 15 Prepayment No Longer Voids the Election

As California pass-through owners approach the June 15, 2026 prepayment, the calculus has changed. Senate Bill 132, signed by Governor Newsom on June 27, 2025, extends the state's elective pass-through entity tax through the 2030 tax year and removes the all-or-nothing trap that had cost owners their entire election for a single missed or short prepayment. Beginning with tax years that start in 2026, missing or underpaying the mandatory June 15 prepayment no longer voids the election. Instead, it reduces each owner's pass-through entity credit by 12.5 percent of that owner's pro rata share of the amount due but not paid. The forfeiture cliff is gone; the June 15 date is now a cost-benefit decision.

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AnalysisMarch 20264 min read

The SALT Cap Rose to $40,400 — and the Pass-Through Workaround Still Matters

OBBBA raised the state and local tax deduction cap to a $40,000 base, indexed to roughly $40,400 for 2026, with a phase-down for high earners. For some clients that materially loosens a constraint that has bound returns since 2018. But the higher cap phases down above $500,000 of income and reverts to $10,000 in 2030 — and states are extending, not repealing, their pass-through entity tax regimes. The PTET election is still a live planning item for 2026.

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AnalysisAugust 20255 min read

The New SALT Math: A $40,000 Cap, a $500,000 Phase-Out, and Why PTET Elections Still Win

The One Big Beautiful Bill Act raised the state and local tax deduction cap from $10,000 to $40,000 — a fourfold increase that reads, at first, like the end of the SALT-workaround era. It is not. The new cap is temporary, it phases down sharply above $500,000 of income, and it reverts to $10,000 in 2030. Meanwhile, the pass-through entity tax workaround survived the bill fully intact, including for service businesses. For higher-income pass-through owners, the entity-level election is still the durable strategy.

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AnalysisFebruary 20251 min read

Multi-State Footprint Review in 2025: Why Filing Exposure Rarely Stays Static

Businesses with even modest geographic growth should treat state filing footprint review as a recurring planning task. Exposure often expands quietly through payroll, sales activity, contractors, or inventory placement.

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AnalysisSeptember 20241 min read

SALT Workarounds for Pass-Through Owners: Why Entity-Level Elections Still Deserve Review

By 2024, pass-through entity tax elections were no longer novel. That is exactly why they risk being overlooked. An election that was reviewed once and then ignored can quietly become suboptimal as income, ownership, and state footprint change.

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AnalysisSeptember 20224 min read

Six More States Turned On the PTE Election in 2022: A Multistate Map of the SALT-Cap Workaround

By mid-2022, more than 30 states had enacted elective pass-through entity taxes as a workaround to the federal $10,000 SALT deduction cap. For multistate businesses, the question has shifted from whether to elect to which states to elect in, when the deadlines fall, and how resident credits interact across state lines.

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AnalysisOctober 20211 min read

California's Pass-Through Entity Tax Election: How the 2021 Workaround Changes SALT Planning

California's elective pass-through entity tax created a practical workaround to the federal SALT cap for many pass-through owners. The opportunity is meaningful, but the election requires timing, entity-level planning, and disciplined payment procedures.

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AnalysisApril 20217 min read

New York Enacts a Pass-Through Entity Tax: How the SALT-Cap Workaround Works, and What Still Awaits Guidance

New York's new elective pass-through entity tax, enacted in the state budget signed April 19, is the state's answer to the federal cap on deducting state and local taxes. The mechanic is sound and the IRS has blessed the structure. But the statute as enacted leaves the first-year operating details — the 2021 election deadline and the 2021 estimated-payment schedule — to forthcoming Department guidance, and owners should plan around the framework now while watching for that guidance before committing.

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