Pass-through Entity Elective Tax & the PPEA: Qualified Entities May File Amended Returns.

• Position: FTB news

On June 30, AB 194 was enacted, which allowed an income exclusion for covered loan amounts forgiven pursuant to the Paycheck Protection Program Extension Act of 2021 (PPPEA) (Public Law 117-6). The PPPEA was enacted March 30, 2021, and extended the covered period of the PPP from March 31,2021, through June 30,2021.

For PTE elective tax purposes, qualified entities that made their PTE elective tax election on their timely filed 2021 California Form 100S, 565, or 568, and included the covered loan amounts that were forgiven under the PPPEA when computing qualified net income may wish to amend their original return by doing the following: For S Corps, use a 2021 California Form 100X, Amended Corporation Franchise or Income Tax Return, to adjust the PTE elective tax amount on Part 2, line 17, and adjust the PTE elective tax payment amount on Part 3, line 25 (payment made with FTB 3893 Voucher), For partnerships filing amended 2021 California Form 565...