PRINTER'S NO. 1730
No. 1268 Session of 2008
INTRODUCED BY ARMSTRONG, FOLMER, PUNT, WOZNIAK, ORIE, ERICKSON,
O'PAKE, GREENLEAF, EARLL, RAFFERTY, WAUGH, RHOADES, D. WHITE,
PILEGGI, PIPPY, BROWNE, REGOLA AND BOSCOLA, FEBRUARY 4, 2008
REFERRED TO FINANCE, FEBRUARY 4, 2008
AN ACT
1 Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An
2 act relating to tax reform and State taxation by codifying
3 and enumerating certain subjects of taxation and imposing
4 taxes thereon; providing procedures for the payment,
5 collection, administration and enforcement thereof; providing
6 for tax credits in certain cases; conferring powers and
7 imposing duties upon the Department of Revenue, certain
8 employers, fiduciaries, individuals, persons, corporations
9 and other entities; prescribing crimes, offenses and
10 penalties," further providing, in personal income tax, for
11 definitions and for poverty provisions.
12 The General Assembly of the Commonwealth of Pennsylvania
13 hereby enacts as follows:
14 Section 1. Section 304 of the act of March 4, 1971 (P.L.6,
15 No.2), known as the Tax Reform Code of 1971, amended December
16 13, 1991 (P.L.373, No.40) and December 23, 2003 (P.L.250,
17 No.46), is amended to read:
18 Section 304. Special Tax Provisions for Poverty.--(a) The
19 General Assembly, in recognition of the powers contained in
20 section 2(b)(ii) of Article VIII of the Constitution of the
21 Commonwealth of Pennsylvania which provides therein for the
22 establishing as a class or classes of subjects of taxation the
1 property or privileges of persons who, because of poverty are
2 determined to be in need of special tax provisions hereby
3 declares as its legislative intent and purpose to implement such
4 power under such constitutional provision by establishing
5 special tax provisions as hereinafter provided in this act.
6 (b) The General Assembly having determined that there are
7 persons within this Commonwealth whose incomes are such that
8 imposition of a tax thereon would deprive them and their
9 dependents of the bare necessities of life and having further
10 determined that poverty is a relative concept inextricably
11 joined with actual income and the number of people dependent
12 upon such income deems it to be a matter of public policy to
13 provide special tax provisions for that class of persons
14 hereinafter designated to relieve their economic burden.
15 (c) For the taxable year 1974 and each year thereafter any
16 claimant who meets the following standards of eligibility
17 established by this act as the test for poverty shall be deemed
18 a separate class of subject of taxation, and, as such, shall be
19 entitled to the benefit of the special provisions of this act.
20 (d) Any claim for special tax provisions hereunder shall be
21 determined in accordance with the following:
22 (1) If the poverty income of the claimant during an entire
23 taxable year is six thousand five hundred dollars ($6,500) or
24 less, or, in the case of a married claimant, if the joint
25 poverty income of the claimant and the claimant's spouse during
26 an entire taxable year is thirteen thousand dollars ($13,000) or
27 less, the claimant shall be entitled to a refund or forgiveness
28 of any moneys which have been paid over to (or would except for
29 the provisions of this act be payable to) the Commonwealth under
30 the provisions of this article, with an additional income
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1 allowance of nine thousand five hundred dollars ($9,500) for
2 each dependent of the claimant. For purposes of this subsection,
3 a claimant shall not be considered to be married if:
4 (i) The claimant and the claimant's spouse file separate
5 returns; and
6 (ii) The claimant and the claimant's spouse live apart at
7 all times during the last six months of the taxable year or are
8 separated pursuant to a written separation agreement.
9 (2) If the poverty income of the claimant during an entire
10 taxable year does not exceed the poverty income limitations
11 prescribed by clause (1) by more than the dollar category
12 contained in subclauses (i), (ii), (iii), (iv), (v), (vi),
13 (vii), (viii) or (ix) of this clause, the claimant shall be
14 entitled to a refund or forgiveness based on the per centage
15 prescribed in such subclauses of any moneys which have been paid
16 over to (or would have been except for the provisions herein be
17 payable to) the Commonwealth under this article:
18 (i) Ninety per cent if not in excess of two hundred fifty
19 dollars ($250).
20 (ii) Eighty per cent if not in excess of five hundred
21 dollars ($500).
22 (iii) Seventy per cent if not in excess of seven hundred
23 fifty dollars ($750).
24 (iv) Sixty per cent if not in excess of one thousand dollars
25 ($1,000).
26 (v) Fifty per cent if not in excess of one thousand two
27 hundred fifty dollars ($1,250).
28 (vi) Forty per cent if not in excess of one thousand five
29 hundred dollars ($1,500).
30 (vii) Thirty per cent if not in excess of one thousand seven
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1 hundred fifty dollars ($1,750).
2 (viii) Twenty per cent if not in excess of two thousand
3 dollars ($2,000).
4 (ix) Ten per cent if not in excess of two thousand two
5 hundred fifty dollars ($2,250).
6 (3) If an individual has a taxable year of less than twelve
7 months, the poverty income thereof shall be annualized in such
8 manner as the department may prescribe.
9 (e) A claimant who has income under section 303 of less than
10 two hundred per cent of the poverty level established by the
11 Bureau of the Census shall be entitled to a credit against the
12 tax imposed by this article for a deposit into a health savings
13 account. The amount of the credit shall be the greater of the
14 amount of the contribution or two thousand five hundred dollars
15 ($2,500).
16 (f) In no case shall the aggregate amount of tax credits
17 awarded in any fiscal year under this section exceed seventy-
18 five million dollars ($75,000,000).
19 Section 2. The addition of section 304(e) of the act shall
20 apply to taxable years beginning after December 31, 2005.
21 Section 3. This act shall take effect immediately.
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