PTET Savings
Estimate PTET owner credit, unrecovered tax, and federal tax savings from supplied rates.
Description
A pass-through entity tax scenario compares a modeled federal deduction benefit with entity tax not recovered through an owner credit.
A pass-through entity tax scenario compares a modeled federal deduction benefit with entity tax not recovered through an owner credit. Either side can dominate the net savings.1
Estimate PTET owner credit, unrecovered tax, and federal tax savings from supplied rates.
When to use PTET Savings
Use this tool to estimate PTET owner credit, unrecovered tax, and federal tax savings from supplied rates.
Choose the specific arithmetic or checklist scenario and establish its input amounts, dates, rates and criteria from the applicable records. Keep currencies, periods and jurisdictions consistent; review the tool-specific assumptions before interpreting the result.
How to use PTET Savings and understand its results
- Choose the specific arithmetic or checklist scenario and establish its input amounts, dates, rates and criteria from the applicable records. Keep currencies, periods and jurisdictions consistent; review the tool-specific assumptions before interpreting the result.
- Enter entityTaxPaid, ownerCreditPercent, federalMarginalRatePercent using the field table and calculation rules, then run the tool.
- Read ownerStateCredit, unrecoveredEntityTax, estimatedFederalTaxSavings, estimatedNetBenefit. The explanation below defines the units, signs, ordering and any flags or placeholder values.
- If the tool reports an input issue, correct the values and run it again. Apply the stated assumptions when interpreting a successfully returned result.
| Input field | Meaning | Value type; see rules below | Requirement |
|---|---|---|---|
| entityTaxPaid | Entity-level PTET paid | number; minimum: 0 | Required |
| ownerCreditPercent | Owner state-credit percentage (%) | number; minimum: 0; maximum: 100 | Required |
| federalMarginalRatePercent | Federal marginal rate (%) | number; minimum: 0; maximum: 100 | Required |
Enter nonnegative entity tax and federal rate with owner-credit percentage in 0–100. Return credit, unrecovered entity tax, federal savings and signed net savings.
ownerCredit=entityTax×creditPercent/100; netSavings=entityTax×federalRate/100−(entityTax−ownerCredit) Units, indexing, boundary conditions and exceptional cases are defined in the calculation rules above.
| Output field | Meaning | Value type |
|---|---|---|
| ownerStateCredit | Owner state credit | number; minimum: 0 |
| unrecoveredEntityTax | Unrecovered entity tax | number; minimum: 0 |
| estimatedFederalTaxSavings | Estimated federal savings | number; minimum: 0 |
| estimatedNetBenefit | Estimated net benefit | number |
{
"input": {
"entityTaxPaid": 100,
"ownerCreditPercent": 100,
"federalMarginalRatePercent": 30
},
"output": {
"ownerStateCredit": 100,
"unrecoveredEntityTax": 0,
"estimatedFederalTaxSavings": 30,
"estimatedNetBenefit": 30
}
}Limitations and assumptions
Election eligibility, deductibility, owner-specific limitations and state credit rules are not established.
Numeric inputs must be finite. Follow the calculation-specific rules for overflow, underflow and exceptional cases. Missing required fields, extra fields, wrong value types and violations of the calculation rules are input errors.
Alternative or Complementary methods
Use Total Tax Burden: Combine supplied tax categories into a total and effective burden. For a complementary task, use Sourcing Tax Comparison: Compare origin- and destination-sourced tax using caller-supplied rates.
References
-
PTET Savings — tool.io
Similar or alternative tools
- Total Tax Burden
Combine supplied tax categories into a total and effective burden.
- Sourcing Tax Comparison
Compare origin- and destination-sourced tax using caller-supplied rates.