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The way it works in my state is as follows Lets assume taxable income of $100,000 and a state tax rate of 10%. PTE Tax = $100,000 x 10%= $10,000. S Corp pays 4 estimated payments totaling $10,000 which reduces Federal Taxable Income - $100,000 - $10,000 = $90,000 thus reducing shareholders Federal Income Tax by $10,000 x 24% (marginal tax rate) = $2,400. In my state the $10,000 is an add back to state taxable income and the $10,000 increases the shareholder state income tax paid. Net Result is a $2,400 reduction in Federal Income Tax and no change in State Income Tax.

Not sure about NC, but I'm assuming the 4.99% is an estimated tax that has to be paid. In NY, the estimated tax rate is a little higher than most taxpayers actual tax rate. When the NY return is prepared, the PTE is added back into taxable income and it is taxed at the TP rate. The estimated payment made by the S Corp is added to the total payments. For example, single member S Corp has $100,000 profit. Estimated PTE payment is 6% ($6,000). S Corp profit is reduced by the $6K and the TP saves their federal marginal tax rate. On the state return the TP adds back in the $6K PTE, bringing taxable income back up to $100K. Marginal rate is 5% so they have a tax liability of $5,000 (which is the same as they would have if they did not pay the PTE). They then apply the $6K estimated payment to their total payments, getting them a refund of $1,000 of the $6,000 they paid in.