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State Taxation of Pass-through Entities and SALT Cap Workaround

State Taxation of Pass-through Entities and SALT Cap

1 Credit

$10

Subject Area

Taxes

Webinar Qualifies For

1 CPE credit of Taxes for all CPAs

1 CE credit of Federal Tax Update for Enrolled Agents ( IRS Approved : GEHNZ ) (Approval No. GEHNZ-U-00618-21-S)

1 CE credit of Federal Tax Law Update for California Tax Professionals (CTEC Approved-6273) (Approval No. 6273-CE-0590)

1 CE credit of Annual Filing Season program (AFSP)( IRS Approved : GEHNZ )

1 CE credit of Federal Tax for Maryland Tax Preparers (Approval No. GEHNZ-U-00618-21-S)

1 CE credit of Federal Tax Update for Oregon Tax Preparers (Approval No. GEHNZ-U-00618-21-S)

1 General Educational credit for Tax Professionals / Bookkeepers / Accountants

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Before starting this self study program, please go through the instructional document.

Overview

  • Tax cuts & jobs act (TCJA)
    2 mins
  • Who bears the burden?
    9 mins
  • Individual income tax base
    12 mins
  • Pass-Through entity withholding tax
    23 mins
  • PTE-Election considerations
    36 mins
  • SALT cap workaround caution!
    45 mins

Course Description

As part of the Tax Cuts and Jobs Act (TCJA), the federal deduction for state and local taxes was limited to $10,000 for a married couple filed jointly. States, particularly those with high taxes, almost immediately started working on mechanisms to help their high-income residents and small business owners avoid this limitation. In November 2020, IRS Notice 2020-75 was published allowing Pass-Through Entities (PTE) to deduct certain state income taxes directly imposed on the PTE, even when such taxes are imposed based upon an election and the PTE’s owners are entitled to a state tax credit. Following this IRS Notice, many states have jumped on board by enacting elective PTE taxes that allow owners of these businesses to avoid the $10,000 federal deduction limitation. These state laws will have a significant effect on federal income tax revenue and set the stage for a showdown in Congress concerning the possible repeal of the SALT deduction limitation.

This online CPE/ CE course will take you through some of the similarities and differences of these taxes and some of the questions arising as these new taxes are implemented. We will also look at recent IRS guidance on the federal deduction for the PTE taxes to examine the potential federal tax benefits of these SALT deduction workarounds.

Major topics covered in this online CPE/CE webinar:

  • Pass-through entities
  • State taxable income
  • Other entity-level taxes
  • New PTE level taxes to circumvent the SALT CAP
  • Recent developments

Learning Objectives

  • To determine general structure of state income taxes imposed on Pass-through Entities (PTE) and their owners. 
  • To discuss detailed analysis of SALT Cap Workaround statutes enacted by many states. 
  • To describe requirements and consequences of electing to impose state income taxes at PTE level. 
  • To discuss the effect of SALT Cap Workaround on PTE owners and income tax revenue.

Who Should Attend?

  • Accountant
  • Accounting Firm
  • Annual Filing Season Program
  • Bookkeepers & Accountants & Tax Preparers
  • California Registered Tax Professional
  • Certified Public Accountant
  • CPA (Industry)
  • CPA - Mid Size Firm
  • CPA - Small Firm
  • Enrolled Agent
  • Maryland Tax Preparers
  • Oregon Tax Preparers
  • Staff of Accounting Firm
  • Tax Attorney
  • Tax Firm
  • Tax Managers
  • Tax Practitioners
  • Tax Preparer
  • Tax Professionals
  • Tax Pros

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