PTET Survives Big Beautiful Tax Bill: Why This Pass-Through Entity Tax Loophole Still Matters

Описание: There was a lot of buzz surrounding the “Big Beautiful Tax Bill” recently signed into law, and while most headlines focused on the new $40,000 SALT deduction cap, a quieter but equally important victory came in the form of what didn’t make it into the final bill for the business owners of pass-through entities
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One major provision originally tucked into the House version of the bill would have eliminated the PTET (Pass-Through Entity Tax) workaround—a popular strategy business owners have been using to bypass the federal $10,000 SALT deduction cap. Thankfully, the Senate stripped that provision from the final legislation, meaning PTET is here to stay—at least for now.

This video will walk through what PTET is, why it still matters (even with a $40,000 cap), and how business owners should think about it in light of the latest tax reform.

Big Beautiful Tax Bill Videos:
$40,000 SALT Cap:    • The New $40,000 SALT Cap: What It Means fo...  
End of the SAVE Program:    • Big Beautiful Tax Bill Overhauls Student L...  
Residential Solar Tax Credit:    • Residential Solar Tax Credit Eliminated in...  
$15 Million Estate Exemption:    • Estate Tax Exemption Raised to $15M Under ...  
Tax-Free Tips & Overtime:    • Tax-Free Tips and Overtime: What the Big B...  
New Age 65+ $6,000 Deduction:    • The New $6,000 Senior Tax Deduction Explained  
Auto Loan Interest Deduction:    • New Auto Loan Interest Deduction Under the...  
EV Tax Credit Eliminated:    • EV Tax Credit Eliminated By The Big Beauti...  
PTET Survives:    • PTET Survives Big Beautiful Tax Bill: Why ...  
HSA Changes:    • Very Few Changes Were Made to HSA Account ...  
Increased Child Tax Credit:    • Child Tax Credit Increased Under the Big B...  

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00:00 Introduction
00:40 What is PTET
01:11 SALT Cap $40,000
01:54 Win for Business Owners

Frequently Asked Questions (FAQs):

What is the Pass-Through Entity Tax (PTET)?
The PTET is a state-level workaround that allows S corporations, partnerships, and other pass-through entities to pay state income tax at the business level rather than at the individual level. Because entity-level taxes are fully deductible federally, PTET helps business owners bypass the federal $10,000 SALT deduction cap.

Did the Big Beautiful Tax Bill eliminate PTET?
No. While the House version of the bill originally proposed eliminating PTET starting in 2025, the Senate removed that provision from the final legislation. As a result, PTET remains fully intact under current federal law.

Why does PTET still matter even with the new $40,000 SALT cap?
The new $40,000 SALT cap is temporary (2025–2029) and phases out for taxpayers with income above $500,000. PTET, on the other hand, applies at the entity level, offering a potentially unlimited deduction regardless of the owner’s income. This makes PTET particularly valuable for high earners in high-tax states.

Can business owners use both PTET and the new $40,000 SALT cap?
Yes. It’s possible to benefit from both. Business owners can use PTET to deduct state income taxes paid at the entity level while still itemizing and using the higher $40,000 SALT cap for property taxes or other eligible personal state taxes.

Which states have PTET programs?
More than 30 states—including New York, New Jersey, California, and Illinois—currently offer PTET elections. Rules vary by state, so business owners should review eligibility, election deadlines, and payment timing requirements with their tax professional.

When does the new $40,000 SALT cap expire?
The expanded SALT cap is available for tax years 2025 through 2029 and is scheduled to revert to $10,000 in 2030 unless Congress extends it. PTET remains in effect beyond that date unless future legislation changes it.

What should business owners do next?
Business owners should continue electing PTET where available, coordinate its use with the new SALT cap for optimal tax benefit, and monitor future tax legislation for potential changes. Working closely with a CPA or tax advisor ensures compliance with both federal and state-level PTET rules.