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Extended Tax Return Deadlines

Posted by Admin Posted on July 31 2019

 

Have you filed your 2018 tax returns yet? The extended deadlines are quickly approaching! Keep reading to find out what we need to prepare your returns, and, when we need it.

 

Business Tax Returns (Form 1065 & 1120S)

Friday, August 23

Turn in information to our firm to file by the filing deadline

 

Monday, September 16

Extended business tax returns due

 

Oklahoma Franchise Tax

Monday, September 16

Mail franchise returns to the OTC

 

Monday, September 16

Extended business tax returns due

 

Trust/Estate Tax Returns (Form 1041)

Monday, September 16

Turn in information to our firm to file by the filing deadline

 

Tuesday, October 1

Extended trust/estate tax returns due

 

Individual Tax Returns (Form 1040)

Friday, September 20

Turn in information to our firm to file by the filing deadline

 

Tuesday, October 15

Extended individual tax returns due

 

 

Oklahoma Enacts SALT Deduction Limit Work-Around for Pass-through Entity Owners

Posted by Admin Posted on June 05 2019

 

The Oklahoma Legislature passed a new law to establish a revenue-neutral mechanism for a fairer and more simplified taxation of pass-through entities (PTEs) and their owners. The new law is intended to provide a work-around of the federal state and local tax (SALT) deduction limit for individual taxpayers that was created by the Tax Cuts and Jobs Act of 2017.

 

The Pass-Through Entity Tax Equity Act of 2019 (the Act) allows certain PTEs – those required to file either an Oklahoma partnership income tax return or an Oklahoma S corporation income tax return – to elect to pay income tax at the entity level, starting with tax year 2019. The Oklahoma source income or losses that the electing PTE includes in computing its tax will not be allocated to the PTE’s interest holders. Because the PTE itself – rather than its owners – will pay Oklahoma income tax on their distributive share of the PTE’s Oklahoma income, the federal $10,000 SALT deduction limit ($5,000 for single taxpayers and married couples filing separate return) will not apply.

 

Here’s how the tax levied on each electing PTE is calculated. First, the PTE owner’s Oklahoma distributive share of income for the tax year is multiplied by five percent (5%), if the owner is an individual, trust or estate, or by six percent (6%), if the owner is a corporation, another pass-through entity or a financial institution. Then, the amounts calculated with respect to all owners are combined to arrive at the pass-through entity tax for that year. The pass-through entity tax is due on the date of the filing of the electing PTE’s Oklahoma income tax return, and estimated tax payments will be  required starting with tax year 2020.

 

The election to become an electing PTE revokes any election to file a composite Oklahoma partnership return or the requirement of an S corporation to report and pay tax on behalf of a nonresident shareholder for the same tax year. Furthermore, with the election in place, a nonresident individual who is an electing PTE’s owner is not required to file an Oklahoma income tax return if for that year (1) the individual’s only Oklahoma source income is from the electing PTE and (2) the electing PTE files its tax return and pays the pass-through entity tax due.

 

The election is binding until revoked by the electing PTE. The Oklahoma Tax Commission may also revoke the election if the pass-through entity tax is not paid when due. Each electing PTE will receive an OTC letter acknowledging the election, a copy of which must be attached to the electing PTE’s Oklahoma income tax return. In addition, the electing PTE must furnish a copy of the OTC acknowledgement letter to its owners and advise them of the requirement to attach it to their Oklahoma income tax returns.

 

For tax year 2019, the election to pay tax at the entity level must be filed by June 28, 2019.

 

We will be reviewing your specific business circumstances to determine whether this election is beneficial to you and whether we recommend making this election for 2019.

Please visit the archive for previous articles.

This blog site is intended for educational purposes directed towards our clients and provides general information about tax, accounting and business related topics.  It is not intended to provide professional advice.  We are not investment advisors. Accordingly, we suggest that you seek the advice of qualified investment advisors appropriate to each investment being considered. By using this blog site, you understand that there is no CPA/client relationship between you and Hyde & Company CPAs, P.C. or its employees.  The blog and website, including all contents posted by the author(s), should not be used as a substitute for competent counsel from a qualified advisor in your state.  Hyde & Company CPAs, P.C. posts are based on current or proposed tax rules at the time they are written and older posts are not updated for tax rule changes.  Tax rules are frequently changed, added, amended, and/or left to expire – always check with your CPA or accountant regarding the most current tax rules and how they apply to your specific tax issue