The PTET was enacted for S corporations in 2021 to address the federal SALT cap and to preserve parity with C corporations by preventing double taxation.

Reducing the PTET credit below 100 percent would convert this neutral mechanism into a direct tax increase on income already taxed at the entity level. For small and mid-sized dental practices facing rising staffing, equipment, and compliance costs, this change would reduce resources available for patient care, workforce retention, and community investment.

Most dental practices operate on thin margins. Reported income reflects operating revenue needed to pay employees and overhead—not discretionary personal income. Limiting the PTET credit would impose disproportionate strain on these practices and reintroduce the double taxation the PTET was designed to prevent.

Licensed healthcare professionals are highly mobile, and New York is already facing workforce shortages and out migration. Increasing the effective tax burden on dental practices risks accelerating these trends, particularly in rural and underserved communities where access to care is already fragile.

Although framed as a technical adjustment, reducing the PTET credit functions as a substantive income tax increase, inconsistent with the State’s stated commitment to avoid new income tax hikes.

For these reasons, I respectfully urge you to reject the PTET credit reduction proposals and preserve full, dollar-for-dollar PTET credits at both the State and City levels.