PTE-160: Underpayment of Estimated Pass-Through Business Alternative Income Tax (2024)

Who files this form

Use Form PTE-160 to determine whether your pass-through entity owes interest on underpaid estimated Pass-Through Business Alternative Income Tax for 2024.

You may owe interest if you did not make estimated payments equal to at least 80% of your 2024 tax liability or 100% of your 2023 tax liability, provided your 2023 PTE-100 covered a full 12-month period.

Complete Part I to check each payment period for an underpayment. If there is an underpayment, complete Part II to check for exceptions.

• If line 3 is less than $400, do not complete the rest of the form.
• If line 15 is zero for every payment period, you do not owe underpayment interest and do not need to file PTE-160.
• If you meet Exception 1 at line 18, do not file PTE-160. The Division of Taxation will verify the amounts.

When it's due

For tax year 2024, enter these estimated-tax installment dates on line 7:

• The 15th day of the fourth month of your tax period.
• The 15th day of the sixth month of your tax period.
• The 15th day of the ninth month of your tax period.
• The 15th day of the first month after your tax period closes.

The text does not state a separate filing deadline for PTE-160.

What you'll need

Have these forms and records available:

• Your 2024 PTE-100, including the entity name, federal employer ID number, tax on line 2, and total on line 6.
• Your 2023 PTE-100, including tax on line 2 and, if claiming Exception 2, distributive proceeds on line 1.
• Records of estimated tax payments, including amounts and payment dates.
• Distributive proceeds for the periods January 1 through March 31, January 1 through May 31, and January 1 through August 31, 2024, if claiming Exception 3 or 4.

For Exceptions 2, 3, and 4, complete the appropriate worksheets and attach all calculations for each exception claimed.

How to file

If you need to file PTE-160:

1. Complete Part I to calculate underpayments for the four payment periods.
2. Complete Part II if any column on line 15 shows an underpayment. Attach the worksheets and calculations required for any Exception 2, 3, or 4 claim.
3. Calculate interest for any period without an applicable exception. Enter total interest on PTE-160, line 22, and PTE-100, line 3.
4. Check the box at line 3 of PTE-100 and include PTE-160 with your return.

The supplied text does not give a mailing address or e-filing directions.

Common mistakes

• Completing the columns out of order. Finish lines 10 through 16 for one column before starting the next column.
• Continuing when the form tells you to stop. Stop if line 3 is less than $400, or if every line 9 column is greater than its corresponding line 8 column.
• Missing supporting calculations. Attach all calculations and complete the appropriate worksheets for Exceptions 2, 3, and 4.
• Filing when Exception 1 applies. The form specifically says not to file PTE-160 if you meet Exception 1.
• Using the wrong interest calculation for late payments. If your 2024 estimated tax payments were not timely, use the Interest Rate Schedule in Option 2.
• Leaving interest off PTE-100. Transfer total interest to line 3 of PTE-100.

Questions people ask

Does an underpayment always mean I owe interest?

No. For a payment period, you do not owe interest if your payments were on time and the cumulative amount on line 17 equals or exceeds the amount calculated under an applicable exception for that period.

What is Exception 1?

Exception 1 uses your 2023 tax liability. It applies only if your prior-year PTE-100 covered a full 12-month period and your current-year payments meet the required prior-year tax amounts. Line 18 shows cumulative percentages of 25%, 50%, 75%, and 100%. If you meet this exception, do not file PTE-160.

What is the difference between Exceptions 3 and 4?

Exception 3 annualizes your 2024 distributive proceeds for the periods shown, using multipliers of 4, 2.4, and 1.5. Exception 4 uses tax on actual distributive proceeds for those periods and takes 90% of that tax. Both require supporting calculations.

How long does interest run under Option 2?

Interest runs from the date the underpayment occurred until it was paid or the original PTE-100 due date, whichever is earlier. It is imposed for each month or part of a month that the underpayment exists.

Official sources

• https://www.nj.gov/treasury/taxation/pdf/other_forms/pte/2024/pte160.pdf