1Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An
2act relating to tax reform and State taxation by codifying
3and enumerating certain subjects of taxation and imposing
4taxes thereon; providing procedures for the payment,
5collection, administration and enforcement thereof; providing
6for tax credits in certain cases; conferring powers and
7imposing duties upon the Department of Revenue, certain
8employers, fiduciaries, individuals, persons, corporations
9and other entities; prescribing crimes, offenses and
10penalties," providing for a tax credit for new jobs for
11unemployed veterans.

12The General Assembly of the Commonwealth of Pennsylvania
13hereby enacts as follows:

14Section 1. Article XVIII-C of the act of March 4, 1971
15(P.L.6, No.2), known as the Tax Reform Code of 1971, added July
169, 2008 (P.L.922, No.66), is amended to read:

17ARTICLE XVIII-C

18[(RESERVED)]

19TAX CREDIT FOR NEW JOBS FOR UNEMPLOYED VETERANS

20Section 1801-C. Definitions.

21The following words and phrases when used in this article

1shall have the meanings given to them in this section unless the
2context clearly indicates otherwise:

3"Department." The Department of Community and Economic
4Development of the Commonwealth.

5"Disabled veteran." Any of the following:

6(1) An unemployed veteran who is entitled to
7compensation or who, except for the receipt of military
8retired pay, would be entitled to compensation, under laws
9administered by the Secretary of Veterans Affairs.

10(2) An unemployed person who was discharged or released
11from active duty because of a service-connected disability.

12"Full-time employment." Employment in which an individual is
13employed by a recipient corporation for at least 35 hours per
14week.

15"Long term." A period of at least six months.

16"New job." A full-time job, the average hourly rate,
17excluding benefits, for which must be at least 150% of the
18Federal minimum wage, created within a municipality located in
19this Commonwealth by a company.

20"Short term." A period of less than six months.

21"Start date." January 1, 2014.

22"Tax credit." A tax credit applied for or granted under this
23article.

24"Unemployed person." An individual who has not held any type
25of full-time employment prior to being hired by a company
26seeking a tax credit under this article.

27"Unemployed veteran." An individual that meets all of the
28following:

29(1) Has performed active service in the armed forces of
30the United States, including the reserve components and the

1National Guard, who was discharged from the active service
2under honorable conditions.

3(2) Has not held any type of full-time employment prior
4to being hired by a company seeking a tax credit under this
5article.

6Section 1802-C. Application.

7(a) Application to department.--A company may submit an
8application for a tax credit under this article in a manner
9required by the department.

10(b) Procedure.--The application shall be attached to the
11company's annual tax return required to be filed under this act.

12Section 1803-C. Tax credits.

13(a) Amount.--A company may claim the following tax credits
14per new job created:

15(1) A $1,200 tax credit for each short-term unemployed
16veteran hired.

17(2) A $2,400 tax credit for each long-term unemployed
18veteran hired.

19(3) A $2,400 tax credit for each disabled veteran hired.

20(b) Maximum amount.--A company may combine tax credits under
21subsection (a) for each unemployed veteran hired but not to
22exceed $4,800.

23(c) Determination of new jobs created.--New jobs shall be
24deemed created to the extent that the company's average
25employment by quarter during the year in which an unemployed
26veteran is hired exceeds the company's average employment level
27by quarter during the previous year.

28(d) Applicable taxes.--A company may apply the tax credit to
29100% of the company's State corporate net income tax, capital
30stock and franchise tax or the capital stock and franchise tax

1of a shareholder of the company, if the company is a
2Pennsylvania S corporation, gross premiums tax, gross receipts
3tax, bank and trust company shares tax, mutual thrift
4institution tax, title insurance company shares tax, personal
5income tax or the personal income tax of shareholders of a
6Pennsylvania S corporation or any combination thereof.

7(e) Availability of tax credits.--

8(1) Each fiscal year, $1,200,000 in tax credits shall be
9made available to the department and may be awarded by the
10department in accordance with this article.

11(2) In addition to the tax credits under paragraph (1),
12in any fiscal year, the department may reissue or assign
13prior fiscal year tax credits which have been recaptured
14under section 1805-C(a) and may award prior fiscal year
15credits not previously issued.

16Section 1804-C. Prohibitions.

17The following actions with regard to job creation tax credits
18are prohibited:

19(1) Approval of jobs that have been created prior to the
20start date.

21(2) Approval for tax credits for a company which is
22relocating operations from one municipality in this
23Commonwealth to another unless special circumstances exist
24and the municipality that is losing the existing jobs has an
25opportunity to submit comments prior to action by the
26department. If the department approves the tax credits, the
27company must commit to preserving the existing employees, and
28the credit shall apply only to the new jobs.

29(3) The assignment, transfer or use of credits by any
30other company, except that tax credits may be assigned in

1whole or in part to an affiliated entity. As used in this
2paragraph, the term "affiliated entity" means an entity which
3is part of the same "affiliated group," as defined by section
41504(a)(1) of the Internal Revenue Code of 1986 (Public Law
599-514, 26 U.S.C. § 1504(a)(1)), as the company awarded the
6credit.

7Section 1805-C. Penalties.

8(a) Failure to maintain operations.--A company which
9receives tax credits and fails to substantially maintain
10existing operations and the operations related to the tax
11credits in this Commonwealth for a period of five years from the
12date the company first receives a tax credit shall be required
13to refund to the Commonwealth the total amount of credits
14granted.

15(b) Waiver.--The department may waive the penalties outlined
16in subsection (a) if it is determined that a company's
17operations were not maintained or the new jobs were not created
18because of circumstances beyond the company's control. Such
19circumstances include natural disasters, unforeseen industry
20trends or a loss of a major supplier or market.

21Section 2. This act shall take effect in 60 days.