Over the extended weekend, the state of Nebraska released the first draft of forms applicable to the enacted pass-through entity tax (PTET) law passed under LB754.
The PTET is a mechanism to shift Nebraska state tax liability to the entity, which makes it deductible to the pass-through entity and therefore reduces the federal taxable income of individual owners.
As a follow-up to our previous correspondence on this matter, we have reviewed the initial forms and the guidance which appear to be in line with our expectations from discussions with various state representatives shortly after the law was passed.
As such, the earliest deadline for filing forms or paying the tax to benefit from the law change is before the end of 2023 for calendar year taxpayers. We are continuing our review of the forms and correspondence with state representatives regarding how the forms will be submitted and tax paid.
As we confirm our understanding of the forms and procedures, over the upcoming months we will assist with filing the forms and submitting tax payments for the applicable entities.