A passthrough entity (PTE) filing New Mexico Form PTE uses Schedule PTE-D to report each owner’s share of net income or losses allocable to New Mexico, even if no tax is being withheld. The PTE also reports on Schedule PTE-D the amount of withholding tax remitted to the state for each nonresident owner, unless that owner has an exception. Schedule PTE-D lists all the passthrough entity's owners and among other things shows the reason code for the owners for whom withholding isn't required.
When attempting to mark a New Mexico PTE tax return for electronic filing, e-file will be blocked and you will receive this message if any owner is indicated as withholding isn't required but no reason has been given:
PTE-D - If box 5 Withholding Required is not checked, must use a reason code 1-12.
To remove this e-file block, from the NM 1065 Menu select:
- Partner Information - Select the first partner.
- Withholding Required - If the answer is already Yes, this owner is not causing the e-file block. If the answer is already No, select this menu line, and answer Yes or No. If the answer is No, you'll be prompted to enter the code corresponding to the reason why withholding isn't required. Click the link below for a list of reason codes in the Form PTE instructions.
Additional Information: