_Tax Administration Page 5 of 12 April 14, 2022 (Updated 12/02/22)
revoking the Taxed PTE Election on the original due date of the NC Tax Return and the
partnership was not granted an extension to file the NC Tax Return.
• An eligible S Corporation is granted an extension of time to file its NC Tax Return for tax year
2022. On September 15, 2023, the S Corporation files a calendar year NC Tax Return for tax
year 2022 and makes the Taxed PTE Election. The S Corporation files an amended NC Tax
Return on October 15, 2023, and revokes the Taxed PTE Election. The revocation of the
Taxed PTE Election is valid. The revocation cannot be further changed since the S
Corporation filed an amended NC Tax Return revoking the Taxed PTE Election on the
extended due date of the NC Tax Return.
A6. How does a Taxed PTE calculate its North Carolina taxable income?
The North Carolina taxable income of a Taxed PTE is determined by adding the following:
1. Each Owner's share of the Taxed PTE’s income or loss, subject to the adjustments provided
in N.C. Gen. Stat. §§ 105-153.5 and 105-153.6
, attributable to North Carolina, and
2. Each resident Owner's share of the Taxed PTE’s income or loss, subject to the adjustments
provided in N.C. Gen. Stat. §§ 105-153.5 and 105-153.6
, not attributable to North Carolina.
Importantly, separately stated items of deduction are not included when calculating each Owner's
share of the Taxed PTE's taxable income. In addition, the adjustments required by
N.C. Gen.
Stat. § 105-153.5(c3) (for Owners of Taxed PTEs) are not included in the calculation of the Taxed
PTE's taxable income.
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A7. How does a Taxed PTE calculate its North Carolina income tax?
A Taxed PTE calculates its North Carolina income tax by multiplying its North Carolina taxable
income by the tax rate imposed on individuals who are required to file an NC Tax Return.
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A8. When is the filing deadline for a Taxed PTE to file its NC Tax Return?
A Taxed PTE must file its NC Tax Return by the due date of the applicable NC Tax Return for the
PTE. Without a valid extension, the due date of the NC Tax Return for an S Corporation and for
a partnership is the 15th day of the 4th month following the PTE’s year end. For example, for a
calendar year Taxed Partnership, Form D-403 must be filed by April 15th.
A PTE that is granted an automatic extension to file a federal income tax return will be granted an
automatic extension to file its corresponding NC Tax Return if the PTE certifies on its NC Tax
Return that the PTE received an automatic federal extension.
If a PTE is not granted an automatic federal extension to file a federal income tax return, the PTE
may still request an extension of time to file its NC Tax Return by filing the applicable North
Carolina extension form by the original due date of the PTE’s NC Tax Return.
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See SB 105, s. 42.5.(c,h), S.L. 2021-180.
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See SB 105, s. 42.5.(c,h), S.L. 2021-180.