PRINTER'S NO. 518
No. 491 Session of 2001
INTRODUCED BY COSTA, MELLOW, M. WHITE, O'PAKE, THOMPSON,
BOSCOLA, LOGAN, MUSTO, WAGNER AND KASUNIC, FEBRUARY 15, 2001
REFERRED TO FINANCE, FEBRUARY 15, 2001
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 for personal income tax
11 definitions.
12 The General Assembly of the Commonwealth of Pennsylvania
13 hereby enacts as follows:
14 Section 1. Section 301(d) of the act of March 4, 1971
15 (P.L.6, No.2), known as the Tax Reform Code of 1971, amended
16 April 23, 1998 (P.L.239, No.45), is amended to read:
17 Section 301. Definitions.--The following words, terms and
18 phrases when used in this article shall have the meaning
19 ascribed to them in this section except where the context
20 clearly indicates a different meaning. Unless specifically
21 provided otherwise, any reference in this article to the
22 Internal Revenue Code shall include the Internal Revenue Code of
1 1986 (Public Law 99-514, 26 U.S.C. § 1 et seq.), as amended to
2 January 1, 1997:
3 * * *
4 (d) "Compensation" means and shall include salaries, wages,
5 commissions, bonuses and incentive payments whether based on
6 profits or otherwise, fees, tips and similar remuneration
7 received for services rendered, whether directly or through an
8 agent, and whether in cash or in property.
9 The term "compensation" shall not mean or include: (i)
10 periodic payments for sickness and disability other than regular
11 wages received during a period of sickness or disability; or
12 (ii) disability, retirement or other payments arising under
13 workmen's compensation acts, occupational disease acts and
14 similar legislation by any government; or (iii) payments
15 commonly recognized as old age or retirement benefits paid to
16 persons retired from service after reaching a specific age or
17 after a stated period of employment; or (iv) payments commonly
18 known as public assistance, or unemployment compensation
19 payments by any governmental agency; or (v) payments to
20 reimburse actual expenses; or (vi) payments made by employers or
21 labor unions, including payments made pursuant to a cafeteria
22 plan qualifying under section 125 of the Internal Revenue Code
23 of 1986 (Public Law 99-514, 26 U.S.C. § 125), for employe
24 benefit programs covering hospitalization, sickness, disability
25 or death, supplemental unemployment benefits or strike benefits:
26 Provided, That the program does not discriminate in favor of
27 highly compensated individuals as to eligibility to participate,
28 payments or program benefits; or (vii) any compensation received
29 by United States servicemen serving in a combat zone; or (viii)
30 payments received by a foster parent for in-home care of foster
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1 children from an agency of the Commonwealth or a political
2 subdivision thereof or an organization exempt from Federal tax
3 under section 501(c)(3) of the Internal Revenue Code of 1954
4 which is licensed by the Commonwealth or a political subdivision
5 thereof as a placement agency; or (ix) payments made by
6 employers or labor unions for employe benefit programs covering
7 social security or retirement; or (x) personal use of an
8 employer's owned or leased property or of employer-provided
9 services; or (xi) any fringe benefit that qualifies as a
10 qualified transportation fringe under section 132(f) of the
11 Internal Revenue Code of 1986, as amended at any time: Provided,
12 That the limits on exclusion from compensation shall be the same
13 limits imposed for Federal tax purposes.
14 * * *
15 Section 2. The amendment of section 301(d) of the act shall
16 apply to taxable years beginning after December 31, 2000.
17 Section 3. This act shall take effect in 60 days.
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