How to: Pay California Pass-Through Entity Tax (PTET) By Check

Here’s what we’ll cover:

• PTE Tax Overview
• Eligibility and Deadlines
• Tax Calculation
• Paying Your PTE Tax By Check

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PTE Tax Overview

As an S Corporation or Partnership doing business in California, you can elect to pay the Pass-Through Entity (PTE) tax at the entity level. This allows California state taxes that you may not have received a benefit from to be taken as a tax deduction on your Federal Income Tax Return.

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Eligibility and Deadlines

An annual election is made on an original, timely filed tax return. Once the election is made, it is irrevocable for that year and is binding on all partners, shareholders, and members of the PTE.

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In order to be eligible for to make a PTE election, your S Corporation must:

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• Make an initial payment by June 15th of each year, and a final payment by the due date of your tax return, without regard to extensions (March 15th of the following year)
• Pay 100% of the PTE tax

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Important note: If you report your taxes on a cash-basis and want to receive tax credit for the current tax year PTE tax liability, you need to make pay the full PTE tax during the tax year and not just a final payment by March 15th.

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Tax Calculation

The PTE elective tax is 9.3% of your Pass-Through Entity’s business income that will be subject to California personal income tax.

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Paying Your PTE Tax By Check

Paying your California PTE tax online is highly recommended. However, in some situations a check may be required. For instance, if you recently registered your business with the CA FTB it could take 2-3 weeks before you are eligible to make online payments.

Step 1: Prepare Your Payment Voucher

Download the payment voucher for the appropriate tax year:

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• 2024 Pass-Through Entity Elective Payment Voucher (Form FTB-3893)

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If you are making your first payment (due June 15), you will complete Payment 1. If you are making your final payment (due March 15 of the following year), you will complete Payment 2.

Step 2: Complete Your Payment Voucher

Enter the following information on the tax payment voucher:

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If you need help finding your California File Number, you can search for your business with the California Secretary of State Entity Search.

Step 3: Prepare Your Payment

Using black or blue ink, make a check or money order payable to the “Franchise Tax Board.”

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On the check or money order, write the following:

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• California corporation number, California SOS file number, or FEIN
• The taxable year the voucher is being submitted for
• “FTB 3893”

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A penalty may be imposed if the payment is returned by the bank for insufficient funds.

Step 4: Mail Your Voucher & Payment

Enclose, but do not staple, the check or money order with the voucher and mail to:

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FRANCHISE TAX BOARD
PO BOX 942857
SACRAMENTO CA 94257-0531

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Save a copy of your check, payment voucher, and mailing label to your document vault as confirmation of your payment.

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Congratulations, you’ve successfully made a payment by check towards your California PTE Tax!