How to make the New York PTET election.

New York’s Pass-Through Entity Tax lets your business pay state income tax for its owners and deduct it federally, outside the SALT cap. Here’s when and how to elect for 2026, and how to pay.

Can your business elect?

Partnerships (including LLCs taxed as partnerships) and New York S corporations subject to the fixed dollar minimum tax. Partnerships with corporate partners can elect. Publicly traded partnerships, single-member LLCs not treated as S corporations, sole proprietorships, trusts, nonprofits, and corporations that are not New York S corporations cannot.

The election covers the entity as a whole: PTE taxable income must include all direct owners subject to New York personal income tax, resident and nonresident. Only direct individual, estate, and trust owners can claim the credit; partnership and corporate owners cannot pass a credit through, though a lower-tier entity may make its own election. The NYC PTET is available only to entities that also elect the state PTET, and only city resident owners' shares are taxed and credited.

Rate: Graduated on total PTE taxable income: 6.85% up to $2 million; $137,000 plus 9.65% over $2 million up to $5 million; $426,500 plus 10.30% over $5 million up to $25 million; $2,486,500 plus 10.90% over $25 million. The NYC PTET is 3.876% of NYC PTE taxable income.

For partnerships, all income of resident owners plus the New York-source income of nonresident owners. For standard S corporations, income apportioned to New York; for resident S corporations, all income without apportionment.

Available for 2026. The New York State PTET under Tax Law Article 24-A applies to tax years beginning on or after January 1, 2021, and the optional New York City PTET under Article 24-B applies to tax years beginning on or after January 1, 2022. New to PTET? See how the election works.

Deadlines

Step	Due for 2026
Make the election	March 16, 2026
1st estimated payment	March 16, 2026
2nd estimated payment	June 15, 2026
3rd estimated payment	September 15, 2026
4th estimated payment	December 15, 2026
Return and balance due	March 15, 2027
Extended return	September 15, 2027

These dates are for a calendar-year business. Pay at least two business days early, since state payment sites slow down on deadline days.

Electing, step by step

Deadline: March 16, 2026 for tax year 2026 (the statutory March 15 fell on a Sunday). The election window opens January 1. Starting with tax year 2027, the enacted FY 2027 budget moves the deadline to September 15.

Have an authorized person for the entity log in to (or create) its Business Online Services account. Tax professionals may not make the election for clients.
Select the Services menu (≡) in the upper-left corner of the Account Summary homepage.
Select Corporation tax or Partnership tax, then choose PTET web file from the expanded menu.
On the Form Selection page, choose Pass-through entity tax (PTET) annual election.
To also opt in to the New York City PTET, make that election in the same annual election. An S corporation electing the NYC PTET certifies that all its shareholders are city taxpayers.
Electronically sign and attest to having the entity's authorization, between January 1 and March 16, 2026.

Paying the tax, step by step

Estimated payments were due March 16, 2026 (moved from a Sunday), and are due June 15, September 15, and December 15, 2026. Each must be at least 25% of the lesser of 90% of the 2026 PTET or 100% of the 2025 PTET (90% of the 2026 PTET if the entity did not elect for 2025). Payments are made only by ACH debit through the online application, and the annualized installment method cannot be used to reduce underpayment penalties.

What you need

An account with NYS Business Online Services for the business. Set it up before the first deadline.
A Business Online Services account for the entity.
The bank routing and account numbers for the ACH debit.
If the bank account blocks ACH debits, the Tax Department's debit information from its ACH debit block page.

Start at NYS Business Online Services, New York's official site.

Log in to the entity's Business Online Services account. An authorized person or the entity's tax professional can make the payment.
Select the Services menu (≡) in the upper-left corner of the Account Summary homepage.
Select Corporation tax or Partnership tax, then PTET web file.
Choose Pass-through entity tax (PTET) estimated payment. NYC PTET estimates are paid through the same application.
Pay by ACH debit. Checks and other payment methods are not accepted for PTET.

Filing the return: The annual PTET return, which also reports the NYC PTET, is filed online by March 15, 2027. A six-month extension to file may be requested by March 15, 2027, but it does not extend the time to pay.

Keep the PTET separate from your personal estimates. The business pays the PTET from its own account under its own ID. Once it does, each owner's personal New York estimates can usually drop by the credit they expect, so the same tax is not paid twice.

Claiming the credit

Eligible owners claim a refundable credit equal to their direct share of the PTET (and NYC PTET, for city residents) on Form IT-653 attached to their personal income tax return, and make a matching addition modification. Excess credit is refunded without interest.

Good to know

New York City PTET: an entity that elects the state PTET can also elect the NYC PTET at 3.876% on income flowing to city resident owners. A partnership qualifies if at least one owner is a city taxpayer; an S corporation qualifies only if it is taxed as a resident S corporation for PTET purposes and all shareholders are city taxpayers.
Owners may take the PTET credit into account when computing their own estimated income tax for the year.
PTET estimated payments cannot be transferred to owners or related entities, and personal income tax estimates made for nonresident partners cannot be applied to the PTET.
Nonresident owners must file their own Form IT-203 to claim the credit; it cannot be claimed on a group return (Form IT-203-GR or IT-203-S).
Chapter 59 of the Laws of 2026 (FY 2027 budget, Part H) moves the election deadline to September 15 for tax years beginning on or after January 1, 2027, with catch-up estimated payments for late electors. The March deadline governed 2026.
Paying your personal New York estimates? See how to pay New York estimated taxes.
Business in more than one state? Each state has a guide of its own.

Official sources

Checked October 2026 against the New York State Department of Taxation and Finance's own publications and N.Y. Tax Law Article 24-A; New York City PTET in Tax Law Article 24-B.

This guide is for general education and reflects rules as of October 2026. Tax law and agency websites change, and your situation may have details that change the answer. Please talk with your tax professional before acting on it.