Connecticut Elective 6.99% PET (87.5% Credit) 2026 Breakeven Analysis

Starting in 2024-2026, Connecticut transitioned its Pass-Through Entity Tax from mandatory to elective while retaining an 87.5% resident credit (a 0.87375% state credit haircut), requiring a breakeven comparison against the 2026 $40,000 federal SALT cap.

Open 2026 $40,000 SALT Cap vs. State PTET Calculator

2026 PTET & SALT Compliance Checklist

• Adopt a Written Partner/Shareholder PTET Consent Resolution: Keep signed authorization in your corporate or partnership minute book.
• Remit Cash-Basis Vouchers Before December 31, 2026: Under IRS Notice 2020-75, cash-basis entities can deduct 2026 PTET only to the extent paid by December 31, 2026.
• Avoid Overpayment Refunds (IRC § 111): Base your Q4 PTET payment on actual projected 2026 state liability so next year's state refund isn't recaptured as ordinary federal income.