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Composite Return Issues for Pass-Through Entities and Nonresidents: Filing, Withholding, Remedying Noncompliance

Recording of a 110-minute CPE webinar with Q&A

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Conducted on Thursday, September 1, 2022

Recorded event now available

or call 1-800-926-7926

This course will provide SALT professionals and pass-through owners who have multistate filing obligations with an in-depth review of preparing composite returns. Filing composite returns is a significant and necessary piece of SALT. However, the burden of withholding and remitting nonresident taxes in many states makes this area even more complicated. Listen as the panel explains composite filing requirements, withholding and payment obligations, individual nonresident filing considerations, and how states' PTE tax regimes affect composite return decisions.


At least 36 states require or allow composite return filing. Practitioners must decide whether filing a composite return is required and, when not required, whether to offer this convenient filing option to owners of flow-through entities. Many states charge per partner penalties for failure to meet reporting and payment obligations, making noncompliance costly. In addition to filing, withholding, and remitting taxes, practitioners must contend with tracking the payments made by nonresidents and the possibility of individual tax notices as well as potential liability for nonresident individuals who are not clients.

Nonresidents who participate in out-of-state entities must decide whether and when it is beneficial to participate in a composite return filing. Participating in a composite return filing doesn't necessarily preclude a taxpayer from filing a nonresident return in a state. Often, a taxpayer can take advantage of lower tax brackets and state credits, or may want the statute of limitations to run in a particular state. All are valid reasons for filing an individual income tax return in a nonresident state.

Listen as the panel explains state composite filing, withholding, and remittance for entities and nonresident shareholders and how to remedy past noncompliance.



  1. State composite return requirements
  2. Pass-through entity composite filing considerations
  3. Elective pass-through entity taxation regimes
  4. Mandatory filing and withholding requirements
  5. Individual taxpayer filing considerations
    1. Participating in a composite return
    2. Filing a nonresident return
  6. Current developments
  7. Past noncompliance and voluntary disclosure programs


The panel will discuss these and other essential questions:

  • How states' PTE tax regimes affect the decision to file a composite return?
  • What are the state requirements for withholding and remitting nonresident withholding?
  • When should a pass-through entity elect to file a composite return?
  • When should an individual elect to participate in a composite filing?
  • What remedies are available for past noncompliance?


Goldhardt, Sara
Sara L. Goldhardt, CPA

Director, State and Local Tax Services
GBQ Partners

Ms. Goldhardt has over 18 years of experience in federal and state and local tax, servicing both public and private...  |  Read More

Reed, Jeffrey
Jeffrey S. Reed

Kilpatrick Townsend & Stockton

Mr. Reed chairs the firm's State and Local Tax Practice. He helps tax directors, business owners, and individuals...  |  Read More

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