State-by-State PTE Election Guide: What Business Owners Need to Know

Nov 19, 2025

Overhead view of a professional workspace with tax forms, spreadsheets, pens, and a tablet displaying a state-by-state tax guide.

If you run an S Corp, partnership, or multi-member LLC, you’ve probably bumped into the $10,000 SALT deduction cap. It’s annoying. It limits how much state tax you can deduct on your federal return. The PTE tax election is how many business owners get around that cap. It lets your business pay state taxes at the entity level instead of pushing those taxes onto your personal return. When the entity pays the tax, you can often deduct the full amount. That means a lower federal tax bill.

This guide walks through how the PTE election works across the country. Each state sets its own rules, deadlines, forms, and tax rates. You’ll get a simple breakdown of what to expect, what varies, and how to plan. Even if your state feels confusing, this guide keeps things clear so you can understand your options before making a move.

Let’s get into it.

States That Offer a PTE Election

Multiple business owners studying a large wall-mounted map with pins marking PTE elections, with papers and laptops on a nearby table.

Below is a clear, repeatable structure showing what business owners typically find for each state. You can adapt this framework when reviewing your state's rules.

Alabama

Available: Yes
Eligible entities: Partnerships, S Corps
Election deadline: With original return
How to elect: Annual form submitted with return
Tax rate: Follows corporate rate
Credit to owners: Yes

Arizona

Available: Yes
Eligible entities: Partnerships, S Corps
Election deadline: With timely filed return
How to elect: Annual check-box election
Tax rate: Flat PTE rate
Credit to owners: Yes

Arkansas

Available: Yes
Eligible entities: Pass-through entities only
Election deadline: Annual
How to elect: State election form
Tax rate: Based on individual rates
Credit to owners: Yes

California

Available: Yes
Eligible entities: S Corps, partnerships
Election deadline: Before year-end payment required
How to elect: Estimated payment triggers election
Tax rate: Set flat rate
Credit to owners: Yes

Colorado

Available: Yes
Eligible entities: Pass-through entities
Election deadline: With return
How to elect: Annual election
Tax rate: Flat state income tax
Credit to owners: Yes

Connecticut

Available: Yes (mandatory)
Eligible entities: All pass-throughs
Election deadline: Automatic
How to elect: No opt-in required
Tax rate: State-set rate
Credit to owners: Yes

Georgia

Available: Yes
Eligible entities: S Corps, partnerships
Election deadline: With timely filed return
How to elect: Annual election
Tax rate: Flat PTE rate
Credit to owners: Yes

Idaho, Illinois, Kansas, Louisiana, Maryland, Massachusetts, Michigan, Minnesota, Missouri, Mississippi, North Carolina, New Jersey, New Mexico, New York, Oklahoma, Oregon, Rhode Island, South Carolina, Utah, Virginia, West Virginia, Wisconsin

These states offer a PTE election with similar structures:

Eligible entities: Mostly S Corps and partnerships
Deadline: Usually with the return or by a fixed state deadline
How to elect: Annual form or online election
Tax rate: Either a flat PTE rate or tied to the individual rate
Credits: Most states grant owners a credit equal to their share of the PTE tax
Special notes: Some require owner consent, and a few lock you in for multiple years

Since each state manages its own rules, your planning will depend on your deadlines, entity type, and whether your state uses a flat rate or a bracketed rate.

States Without a PTE Election

Empty business desk with papers labeled “No PTE Election,” a calculator, and a laptop, in muted colors, visually conveying the absence of options.

A few states do not offer a PTE election. This list can change, so always double-check before assuming your state is out of play.

These states generally do not offer PTE elections:

Hawaii
Nevada
New Hampshire
Pennsylvania (partial allowance depending on entity rules)
Tennessee
Texas (handled differently due to franchise tax)
Washington
Wyoming
Alaska
Florida (no individual income tax structure)
South Dakota
North Dakota (partial allowances vary by year)

In most of these states, the reason is simple. Either they don’t tax personal income, or they use a tax structure that doesn’t support PTE-level optional taxation.

Summary Table

State	PTE/PTET Available?	Typical election method	Timing to watch	Eligible entities	Special note
Alabama	Yes	Credit / Form	With return; check state portal deadlines	Partnerships, S Corps	Election filed online; confirm payment mechanics.
Alaska	No	No income tax	N/A	N/A	No broad state personal income tax.
Arizona	Yes	Flat PTE rate / Form	With return; estimated payments possible	Partnerships, S Corps	See AZ guidance for forms and payment timing.
Arkansas	Yes	Credit / Form	Annual election with return; estimated voucher exists	Partnerships, S Corps	Forms and AR1100ES voucher available.
California	Yes (limited years)	Flat PTE rate / Payment triggers election	Elect by June 15 payment then file return	Partnerships, S Corps	CA uses a payment to secure election; check FTB forms.
Colorado	Yes	Credit / Form	With return; SALT Parity Act rules	Partnerships, S Corps	Colorado guidance on SALT Parity Act; watch tiered structure rules.
Connecticut	Yes	Credit / Form (mandatory-like history)	Varies by program	Pass-throughs	CT has a long-running PET regime; check current filing forms.
Delaware	Yes	Form / Payment	With return / portal filing	Partnerships, S Corps	File via state portal; verify owner credit rules.
Florida	No	No income tax	N/A	N/A	No broad individual income tax so PTE election not applicable.
Georgia	Yes	Form / Credit or AGI adj	With return; election irrevocable for year	Partnerships, S Corps	GA FAQ and HB 149 details explain owner treatment.
Hawaii	Yes	PTET / Credit	With return; specific payment and credit rules	Pass-throughs	Hawaii has PTET guidance and temporary rules; check rate.
Idaho	Yes	Credit / Form	With return	Pass-throughs	Idaho guidance lists eligible entity types.
Illinois	Yes	Credit / Form	With return	Partnerships, S Corps	IL PTE rate and credit mechanics; election on entity return.
Indiana	Yes	PTET / Form	With return; retroactive rules to 2022	Partnerships, S Corps	IN enacted PTET; check forms and FAQ.
Iowa	Yes	Credit / Form	With return; early year transitional deadlines applied	Partnerships, S Corps	Iowa PTET is voluntary; owners get refundable credit by statute.
Kansas	Yes	Credit / Form	With return; estimated payment options	Partnerships, S Corps	KS SALT Parity Act; estimated payment voucher available.
Kentucky	Yes	Credit / Form	With return	Pass-throughs	Verify interactions with credits and carryforwards.
Louisiana	Yes	Credit / Form	With return	Pass-throughs	Confirm credit refundability.
Maine	Varies / Proposed	Varies	Varies	Varies	Proposed or limited schemes in some years; verify current law.
Maryland	Yes	Credit / Form	With return	Pass-throughs	Check multi-state withholding and owner treatment.
Massachusetts	Yes	Credit / Form	With return	Pass-throughs	Temporary provisions have existed; confirm current rules.
Michigan	Yes	Credit / Form	With return	Pass-throughs	Recent state updates; check MI DOR guidance.
Minnesota	Yes	Credit / Schedule PTE	With return	Pass-throughs	Minnesota requires Schedule PTE; owners get refundable credit.
Mississippi	Yes	Credit / Form	With return	Pass-throughs	Mississippi guidance indicates refundable credit historically.
Missouri	Yes	Credit / Form	With return	Pass-throughs	Confirm state-specific forms and timing.
Montana	Yes	Credit / Form	With return	Pass-throughs	Verify owner credit process.
Nebraska	Yes	Credit / Form	With return	Pass-throughs	Check state DOR for filing method.
Nevada	No	No income tax	N/A	N/A	No broad personal income tax.
New Hampshire	No (limited)	Interest/dividend tax only	N/A	N/A	No broad wage-based income tax; PTE uncommon.
New Jersey	Yes	Credit / Form	With return; early payments may be required	Pass-throughs	NJ has defined PTET rules and forms.
New Mexico	Yes	Credit / Form	With return	Pass-throughs	NM enacted PTET-style rules; check DOR forms.
New York (state)	Yes	Credit / Form	With return; NY City separate regime	Pass-throughs	NY State PTET and NYC elective tax both exist.
North Carolina	Yes	Credit / Form	With return	Pass-throughs	NC expanded eligibility; check DOR guidance.
North Dakota	Limited	Varies	Varies	Varies	Partial allowances or special rules may apply.
Ohio	Yes	Credit / Form	With return	Pass-throughs	Verify local filing interactions and credits.
Oklahoma	Yes	Credit / Form	With return	Pass-throughs	Check recent updates for PTET.
Oregon	Yes	AGI adj / Credit	With return	Pass-throughs	Oregon uses AGI adjustments in some circumstances.
Pennsylvania	Limited / Varies	Varies	Varies	Varies	Complex and conditional rules; verify.
Rhode Island	Yes	Credit / Form	With return	Pass-throughs	Confirm estimated payment timing.
South Carolina	Yes	Credit / Form	With return	Pass-throughs	Confirm refundability of credits.
South Dakota	No	No income tax	N/A	N/A	No broad personal income tax.
Tennessee	No (generally)	Franchise/excise taxes apply	N/A	N/A	No general individual income tax; PTE not commonly applicable.
Texas	No	No state personal income tax	N/A	N/A	PTE election not relevant due to no income tax.
Utah	Yes	Credit / Form	With return	Pass-throughs	Flat-rate state; confirm PTE mechanics.
Vermont	Varies / Proposed	Varies	Varies	Varies	Proposed or limited schemes in some years.
Virginia	Yes	Credit / Form	With return	Pass-throughs	Verify filing method and rate on VA DOR site.
Washington	No	No income tax	N/A	N/A	No personal income tax.
West Virginia	Yes	Credit / Form	With return	Pass-throughs	Confirm recent legislative updates.
Wisconsin	Yes	Credit / Form	With return	Pass-throughs	Watch owner consent rules and carryforward.
Wyoming	No	No income tax	N/A	N/A	No broad personal income tax.

Important notes

This is a practical, high-level reference, not a legal source. This is a compiled table from state DOR pages and current industry summaries, but statutes, forms, deadlines, rates, and credit refundability change. Make sure to verify before filing and find a CPA to talk to.

Common items you should verify for your state before acting

Exact election form name and where to file.
Whether an estimated payment is required and its due date.
Whether the owner's credit is refundable and if there are carryforward rules.
Whether owner consent or unanimous approval is required.
Any limits or exclusions for certain owner types (corporate owners, tiered entities, trusts).

Download Summary Table

👉 Download PTE_State_by_State_Guide.xlsx

Key Differences You’ll Notice Across States

Collage of state-level paperwork, calendars, and digital forms over a subtle map overlay, illustrating varied rules and regulations.

Even though many states offer a PTE election, the details vary enough that you need to understand the main differences. Here are the areas where states diverge the most.

1. Owner Consent Rules

Some states let the entity make the election without asking every owner. Others require unanimous or majority consent. This matters if you have many partners or investors.

2. Deadline Variations

Deadlines fall into a few buckets:

With the original return
On or before a specific day each year
Before making the first estimated payment

Missing the deadline usually means waiting until next year.

3. How You Make the Election

States use different methods. This includes:

A check box on the return
A specific election form
An online portal
A required prepayment

4. Tax Rate Differences

Some states use:

A flat PTE rate
The individual income tax brackets
The corporate tax rate

This affects whether the election helps or hurts your tax bill.

5. Multi-Year vs. Annual Elections

Most states require an annual election. A few lock you in for more than one year once you choose it. That’s something to check before committing.

6. Treatment of Nonresident Owners

Some states let you include nonresident owners. Others don’t. Some allow them but require extra withholding.

How to Use This Guide for Tax Planning

Professional desk with layered charts illustrating federal savings, state taxes, and entity structures, accompanied by a calculator and pen.

If you’re thinking about electing PTE tax, here are the parts of your state’s rules that matter most:

1. The Tax Rate

If your state uses a flat rate higher than what you currently pay, the election may not help. The value of the election comes from the federal deduction, so you need to compare both sides.

2. Your Ownership Structure

If you have a mix of residents and nonresidents, your state’s owner credit rules matter. Some owners may not benefit as much.

3. Filing and Payment Deadlines

Some states require electing or prepaying before the end of the taxable year. If you miss it, you can’t fix it later. Lock in your deadlines early.

4. Federal Savings Potential

The main benefit comes from bypassing the $10,000 SALT cap. To see whether the election helps, calculate:

State tax due
Federal deduction gained
Credit applied back to owners

A CPA or tax software can help you test the numbers.

5. S Corp vs. Partnership Considerations

Each entity type interacts with state rules differently. Things like guaranteed payments, distributive shares, and owner residency can change the math.

Conclusion: Take Control of Your PTE Election in 2025

Small business owners and accountants gathered at a table with laptops, spreadsheets, and charts, reviewing state tax details and planning PTE strategy in a warm, focused setting.

Navigating state PTE elections can feel overwhelming, but understanding the rules for your state and your business type is the key to maximizing tax savings. With this guide, you now know which states allow PTE elections, how the election works, and the practical steps to file correctly.

Use the 50-state table and downloadable Excel file to quickly check deadlines, rates, and credit rules. Whether you’re planning for this tax year or preparing for next, these resources give you a clear roadmap to make informed decisions, reduce tax liability, and stay compliant—without the guesswork.

If you want a simple walkthrough of the basics, check out the full guide on "What Is the PTE Tax Election and How Does It Work?". It gives you the foundation you need before planning your next steps.

Frequently Asked Questions

What is the PTE tax election?

It lets your business pay state income taxes at the entity level. This often restores the federal tax deduction lost due to the $10,000 SALT cap.

Does every state offer a PTE election?

No. Many do, but a handful do not. Some states with no income tax skip it entirely.

Does the election lower my federal tax bill?

Usually yes. The entity deducts the full state tax, which can reduce taxable income.

Can an S Corp make the election?

In most states, yes. A few states exclude S Corps or limit them.

Can a single-member LLC make the election?

Generally no because it’s not treated as a pass-through entity for state purposes.

Do nonresident owners benefit?

It depends on the state. Some give credits. Others restrict eligibility.

How often do you elect PTE status?

Most states require an annual election. A few lock you in for more than one year.

What happens if I miss the deadline?

You usually lose the election for that year and must wait until the next filing cycle.

Can I revoke a PTE election?

Some states allow revocations. Others do not. Many require a formal request.

Is the PTE election always tax savings?

Not always. It depends on your state rate, your federal bracket, and how the credit flows through to owners.

Contact

(800) 344-5226

gary@andemax.com

Contact

(800) 344-5226

gary@andemax.com

Contact

(800) 344-5226

gary@andemax.com