ptet payment

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#17920 Closed public Multifamily _General Support
Customer Reply

Hello –

I have a for-profit HUD that made a PTET election in 2022. For GAAP purposes this should be shown as a distribution. Does it actually count as a distribution to the owner? For example, if 2021 surplus cash was $200,000 and they made an actual distribution to the owner for $190,000, but then had a PTET payment of $20,000, does that mean they took distributions in excess of the PY surplus cash? (distribution plus PTET 190 +20 = $210 is greater than $200k surplus cash)
Customer Reply

Hi Les –

 

I did not receive your email from last week. Can you re-send?

Thank you for your assistance!

 

Rachel Ashcroft, CPA

Senior Manager

 

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From: Les Sparks <les@ahacpa.org>
Sent: Monday, February 27, 2023 7:31 PM
To: AHACPA Support <support@ahacpa.org>
Cc: Ashcroft, Rachel <Rachel.Ashcroft@freedmaxick.com>
Subject: RE: ptet payment
Les Sparks

Rachael, I hesitated to answer this last week as I was issuing the email. I hope you received that. Since that email, I received a response from HUD indicating the exact same thing. So all PTE taxes must be considered uses of surplus cash. You would not show it as a distribution, it goes in account 7130 in the P&L. IN this case the extra $10k is an excess distribution.

 

Les Sparks
AHACPA | 459 N 300 W #10 | Kaysville, UT 84037 | Phone: 801-547-0809
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From: AHACPA Support <support@ahacpa.org>
Sent: Monday, February 27, 2023 5:02 PM
To: les@ahacpa.org
Subject: ptet payment

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