Amendment 5533 to Senate Bill 654 P.N. 1433, Regular Session 2023-2024

S0654B1433A05533 PWK:JSL 07/11/24 #90 A05533

AMENDMENTS TO SENATE BILL NO. 654

Sponsor: SENATOR BARTOLOTTA

Printer's No. 1433

Amend Bill, page 1, lines 1 through 12, by striking out all

of said lines and inserting

Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An

act relating to tax reform and State taxation by codifying

and enumerating certain subjects of taxation and imposing

taxes thereon; providing procedures for the payment,

collection, administration and enforcement thereof; providing

for tax credits in certain cases; conferring powers and

imposing duties upon the Department of Revenue, certain

employers, fiduciaries, individuals, persons, corporations

and other entities; prescribing crimes, offenses and

penalties," in sales and use tax, further providing for

exclusions from tax; in personal income tax, further

providing for definitions and for classes of income and

providing for transfer to Clean Streams Fund; in corporate

net income tax, further providing for definitions and

providing for determination of net loss deduction; in bank

and trust company shares tax, further providing for

ascertainment of taxable amount and exclusion of United

States obligations; in realty transfer tax, further providing

for transfer of tax; in Historic Preservation Incentive Tax

Credit, further providing for tax credit certificates; in

Coal Refuse Energy and Reclamation Tax Credit, further

providing for application and approval of tax credit and for

limitation on tax credits; in city revitalization and

improvement zones, further providing for definitions, for

establishment or designation of contracting authority, for

approval, for reports, for transfers, for restrictions, for

transfer of property and for review; in Manufacturing and

Investment Tax Credit, further providing for definitions, for

rural growth funds, for claiming the tax credit and for

revocation of tax credit certificates; in Neighborhood

Assistance Tax Credit, further providing for tax credit and

for grant of tax credit; providing for 529 savings account

employer matching contribution tax credit and for employer

child care contribution tax credit; in Computer Data Center

Equipment Incentive Program, further providing for

definitions and for sales and use tax exemption; providing

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for tuition account programs; and making an editorial change.

Amend Bill, page 1, lines 15 through 22; page 2, lines 1

through 30; page 3, lines 1 through 5; by striking out all of

said lines on said pages and inserting

Section 1. Section 204 of the act of March 4, 1971 (P.L.6,

No.2), known as the Tax Reform Code of 1971, is amended by

adding a clause to read:

Section 204. Exclusions from Tax.--The tax imposed by

section 202 shall not be imposed upon any of the following:

* * *

(76) The sale at retail or use of services related to the

cleaning or maintenance of a storage trap utilized by a food

service or restaurant establishment to collect grease waste.

Section 2. Section 301 of the act is amended by adding

subsections to read:

Section 301. Definitions.--Any reference in this article to

the Internal Revenue Code of 1986 shall mean the Internal

Revenue Code of 1986 (Public Law 99-514, 26 U.S.C. § 1 et seq.),

as amended to January 1, 1997, unless the reference contains the

phrase "as amended" and refers to no other date, in which case

the reference shall be to the Internal Revenue Code of 1986 as

it exists as of the time of application of this article. The

following words, terms and phrases when used in this article

shall have the meaning ascribed to them in this section except

where the context clearly indicates a different meaning:

* * *

(o.5) "Qualified student loan" means indebtedness incurred

by a taxpayer to pay educational expenses, which are:

(1) incurred on behalf of the taxpayer at the time the

indebtedness is incurred;

(2) paid or incurred within a reasonable period of time

before or after the indebtedness is incurred; and

(3) attributable to education furnished during a period in

which the recipient is a student.

The term includes indebtedness used to refinance indebtedness

that qualifies as a a qualified student loan. The term does not

include indebtedness owed by a taxpayer to a person related to

the taxpayer.

* * *

(t.1) "Student loan interest" means interest paid during the

taxable year on a qualified student loan, including required and

voluntary interest payments, to attend a college, university,

vocational school or other postsecondary educational institution

eligible to participate in a student aid program administered by

the United States Department of Education.

* * *

Section 3. Section 303(a.7)(2)(i)(B) of the act is amended,

the subsection is amended by adding a paragraph and the section

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is amended by adding clauses to read:

Section 303. Classes of Income.--* * *

(a.7) The following apply:

* * *

(2) (i) The following shall not be subject to tax under

this article:

* * *

(B) [Any rollover that is excludable from tax under section

529(c)(3)(C) of the Internal Revenue Code of 1986, as amended.]

Any distribution that is excludable from tax under section 529

of the Internal Revenue Code of 1986, as amended.

* * *

(E) Any amount received by an employe through an employer's

matching contribution to an account as defined under Article

XIX-J.

* * *

(7) An amount received from the Federal or State Government

or Norfolk Southern Railway, or an agent thereof, as a result of

the train derailment that occurred in East Palestine, Ohio, on

February 3, 2023, shall not be considered income subject to the

tax imposed by this article.

* * *

(a.11) The amount of student loan interest paid during a

taxable year by a resident individual shall be deductible from

taxable income on the annual personal income tax return,

provided that the deduction may not:

(1) exceed two thousand five hundred dollars ($2,500) per

taxable year; and

(2) result in taxable income being less than zero.

(a.12) A person may claim a deduction for depletion of a

mine, oil and gas well and other natural deposit in accordance

with the provisions of sections 611, 612, 613, 613A, 614, 616

and 617 of the Internal Revenue Code of 1986 (Public Law 99-514,

26 U.S.C. § 611 et seq.) in effect on the effective date of this

subsection.

* * *

Section 4. The act is amended by adding a section to read:

Section 360.1. Transfer to Clean Streams Fund.--No later

than August 1, 2024, and each August 1 thereafter, the sum of

fifty million dollars ($50,000,000) shall be transferred from

the proceeds of the tax imposed under this article to the Clean

Streams Fund established under section 1712-A.2 of the act of

April 9, 1929 (P.L.343, No.176), known as "The Fiscal Code."

Section 5. Part I heading of Article IV of the act is

amended to read:

PART I

[DEFINITIONS] PRELIMINARY PROVISIONS

Section 6. Section 401(c)(1)(A) and (2)(B) of the act are

amended and clause (3)1 is amended by adding phrases to read:

Section 401. Definitions.--The following words, terms, and

phrases, when used in this article, shall have the meaning

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ascribed to them in this section, except where the context

clearly indicates a different meaning:

* * *

(3) "Taxable income." 1. * * *

(b.2) An additional deduction shall be allowed from the

taxable income of a medical cannabis business in the amount of

the ordinary and necessary expenses that were paid or incurred

by the medical cannabis business during the taxable year that

are ordinarily deductible for Federal income tax purposes under

section 162 of the Internal Revenue Code of 1986 (26 U.S.C. §

162) if no deduction for ordinary and necessary expenses paid or

incurred by the medical cannabis business was taken for Federal

income tax purposes for the taxable year. As used in this

paragraph, the term "medical cannabis business" shall mean a

medical marijuana organization as defined in section 103 of the

act of April 17, 2016 (P.L.84, No.16), known as the "Medical

Marijuana Act," that has an active grower/processor permit

during the taxable year for which the deduction is sought.

* * *

(u) (1) To the extent a taxpayer makes the adjustment

required by phrase (t)(1) an affiliated entity which is subject

to tax under this article on a tax base that includes the

intangible expense or cost, or the interest expense or cost,

paid, accrued or incurred by the taxpayer may annually elect to

exclude the intangible expense or cost, or the interest expense

or cost when determining the affiliated entity's taxable income

under subclause 1, or if applicable, subclause 2. If such an

election is made, the taxpayer that made the adjustment required

by phrase (t)(1) shall not be entitled to receive any credit

against tax due in this Commonwealth as calculated under phrase

(t)(1)(A) or (B).

(2) The election under paragraph (1) shall be made by the

affiliated entity with the filing of it's original return. The

affiliated entity shall identify the name and Federal EIN of the

taxpayer to which the election applies. Nothing in this

paragraph shall otherwise impact nexus or apportionment of the

taxpayer or the affiliated entity.

(3) In no case shall the exclusion under paragraph (1)

exceed the intangible expense or cost, or the interest expense

or cost, paid, accrued or incurred by the taxpayer.

4. * * *

(A) (I) For taxable years beginning before January 1, 2007,

two million dollars ($2,000,000);

(II) For taxable years beginning after December 31, 2006,

the greater of twelve and one-half per cent of taxable income as

determined under subclause 1 or, if applicable, subclause 2 or

three million dollars ($3,000,000);

(III) For taxable years beginning after December 31, 2008,

the greater of fifteen per cent of taxable income as determined

under subclause 1 or, if applicable, subclause 2 or three

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million dollars ($3,000,000);

(IV) For taxable years beginning after December 31, 2009,

the greater of twenty per cent of taxable income as determined

under subclause 1 or, if applicable, subclause 2 or three

million dollars ($3,000,000);

(V) For taxable years beginning after December 31, 2013, the

greater of twenty-five per cent of taxable income as determined

under subclause 1 or, if applicable, subclause 2 or four million

dollars ($4,000,000);

(VI) For taxable years beginning after December 31, 2014,

the greater of thirty per cent of taxable income as determined

under subclause 1 or, if applicable, subclause 2 or five million

dollars ($5,000,000);

(VII) For taxable years beginning after December 31, 2017,

thirty-five per cent of taxable income as determined under

subclause 1 or, if applicable, subclause 2;

(VIII) For taxable years beginning after December 31, 2018,

forty per cent of taxable income as determined under subclause 1

or, if applicable, subclause 2; [or]

(IX) For taxable years beginning after December 31, 2024,

the percentage of taxable income as determined under section

401.1; or

* * *

(2) * * *

(B) The earliest net loss shall be carried over to the

earliest taxable year to which it may be carried under this

schedule. The total net loss deduction allowed in any taxable

year shall not exceed:

(I) Two million dollars ($2,000,000) for taxable years

beginning before January 1, 2007.

(II) The greater of twelve and one-half per cent of the

taxable income as determined under subclause 1 or, if

applicable, subclause 2 or three million dollars ($3,000,000)

for taxable years beginning after December 31, 2006.

(III) The greater of fifteen per cent of the taxable income

as determined under subclause 1 or, if applicable, subclause 2

or three million dollars ($3,000,000) for taxable years

beginning after December 31, 2008.

(IV) The greater of twenty per cent of the taxable income as

determined under subclause 1 or, if applicable, subclause 2 or

three million dollars ($3,000,000) for taxable years beginning

after December 31, 2009.

(V) The greater of twenty-five per cent of taxable income as

determined under subclause 1 or, if applicable, subclause 2 or

four million dollars ($4,000,000) for taxable years beginning

after December 31, 2013.

(VI) The greater of thirty per cent of taxable income as

determined under subclause 1 or, if applicable, subclause 2 or

five million dollars ($5,000,000) for taxable years beginning

after December 31, 2014.

(VII) Thirty-five per cent of taxable income as determined

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under subclause 1 or, if applicable, subclause 2 for taxable

years beginning after December 31, 2017.

(VIII) Forty per cent of taxable income as determined under

subclause 1 or, if applicable, subclause 2 for taxable years

beginning after December 31, 2018.

(IX) The percentage of taxable income as determined under

section 401.1 for taxable years beginning after December 31,

2024.

* * *

Section 7. The act is amended by adding a section to read:

Section 401.1. Determination of Net Loss Deduction.--(a)

For taxable years beginning after December 31, 2024, and prior

to January 1, 2026, the net loss deduction shall be determined

as follows:

(1) Deduct forty per cent of taxable income as determined

under subclause 1 of section 401(3) or, if applicable, subclause

2 of section 401(3), for a net loss incurred in a taxable year

beginning prior to January 1, 2025.

(2) (Reserved).

(b) For taxable years beginning after December 31, 2025, and

prior to January 1, 2027, the net loss deduction shall be

determined as follows:

(1) Deduct forty per cent of taxable income as determined

under subclause 1 of section 401(3) or, if applicable, subclause

2 of section 401(3), for a net loss incurred in a taxable year

beginning prior to January 1, 2025.

(2) For a net loss incurred in a taxable year beginning

after December 31, 2024, deduct an amount equal to:

(i) fifty per cent minus the actual percentage of taxable

income deducted under paragraph (1); multiplied by

(ii) the taxable income as determined under subclause 1 of

section 401(3) or, if applicable, subclause 2 of section 401(3).

prior to January 1, 2028, the net loss deduction shall be

determined as follows:

(1) Deduct forty per cent of taxable income as determined

under subclause 1 of section 401(3) or, if applicable, subclause

2 of section 401(3), for a net loss incurred in a taxable year

beginning prior to January 1, 2025.

(2) For a net loss incurred in a taxable year beginning

after December 31, 2024, deduct an amount equal to:

(i) sixty per cent minus the actual percentage of taxable

income deducted under paragraph (1); multiplied by

(ii) the taxable income as determined under subclause 1 of

section 401(3) or, if applicable, subclause 2 of section 401(3).

(d) For taxable years beginning after December 31, 2027, and

prior to January 1, 2029, the net loss deduction shall be

determined as follows:

(1) Deduct forty per cent of taxable income as determined

under subclause 1 of section 401(3) or, if applicable, subclause

2 of section 401(3), for a net loss incurred in a taxable year

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beginning prior to January 1, 2025.

(2) For a net loss incurred in a taxable year beginning

after December 31, 2024, deduct an amount equal to:

(i) seventy per cent minus the actual percentage of taxable

income deducted under paragraph (1); multiplied by

(ii) the taxable income as determined under subclause 1 of

section 401(3) or, if applicable, subclause 2 of section 401(3).

(e) For taxable years beginning after December 31, 2028, the

net loss deduction shall be determined as follows:

(1) Deduct forty per cent of taxable income as determined

under subclause 1 of section 401(3) or, if applicable, subclause

2 of section 401(3), for a net loss incurred in a taxable year

beginning prior to January 1, 2025.

(2) For a net loss incurred in a taxable year beginning

after December 31, 2024, deduct an amount equal to:

(i) eighty per cent minus the actual percentage of taxable

income deducted under paragraph (1); multiplied by

(ii) the taxable income as determined under subclause 1 of

section 401(3) or, if applicable, subclause 2 of section 401(3).

Section 8. Section 701.1(b), (b.1) and (c) of the act are

amended to read:

Section 701.1. Ascertainment of Taxable Amount; Exclusion of

United States Obligations.--* * *

(b) A deduction for the value of United States obligations

shall be provided from the taxable amount of shares in an amount

equal to the same percentage of total bank equity capital as the

book value of obligations of the United States bears to the book

value of the total assets. In computing the deduction for United

States obligations, any goodwill [recorded as a result of the

use of purchase accounting for an acquisition or combination as

described in this section and occurring after June 30, 2001,]

deducted from the taxable amount of shares under subsection

(b.1) shall be subtracted from the book value of total bank

equity capital and disregarded in determining the deduction

provided for obligations of the United States. For purposes of

this article, United States obligations shall be obligations

coming within the scope of 31 U.S.C. § 3124 (relating to

exemption from taxation).

(b.1) A deduction for goodwill shall be provided from the

taxable amount of shares in an amount equal to the value of any

goodwill recorded [as a result of the use of purchase accounting

for an acquisition or combination as described in this section]

in the Reports of Condition of the institution pursuant to

generally accepted accounting principles because of an

acquisition or business combination and occurring after June 30,

2001.

[(c) For purposes of this section:

(1) a mere change in identity, form or place of organization

of one institution, however effected, shall be treated as if a

single institution had been in existence prior to as well as

after such change; and

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(2) if there is a combination of two or more institutions

into one, the book values and deductions for United States

obligations from the Reports of Condition of the constituent

institutions shall be combined. For purposes of this section, a

combination shall include any acquisition required to be

accounted for by using the purchase method in accordance with

generally accepted accounting principles or a statutory merger

or consolidation.]

Section 9. Section 1102-C.6(a) and (b) of the act are

amended and the section is amended by adding a subsection to

read:

Section 1102-C.6. Transfer of Tax.--(a) [Subject to

subsection (b), beginning] Beginning July 31, 2019, and each

July 31 thereafter, the State Treasurer shall transfer from the

General Fund to the Housing Affordability and Rehabilitation

Enhancement Fund under Article IV-D of the act of December 3,

1959 (P.L.1688, No.621), known as the "Housing Finance Agency

Law," an amount [equal to forty per cent of the difference

between:

(1) the total amount of the tax imposed under section 1102-C

and collected by the Commonwealth for the prior fiscal year; and

(2) the total dollar amount of such tax estimated for the

fiscal year beginning July 1, 2014, and as contained in the

final estimate signed by the Governor for that fiscal year as

required by section 618 of the act of April 9, 1929 (P.L.177,

No.175), known as "The Administrative Code of 1929."] under

subsection (b).

(b) The amount transferred under subsection (a) [may not

exceed] shall be equal to the following:

(1) For each fiscal year beginning after June 30, 2019, and

ending prior to July 1, 2023, forty million dollars

($40,000,000).

(2) For the fiscal year beginning [July 1, 2023, and each

fiscal year thereafter, sixty million dollars ($60,000,000).]

after June 30, 2023, and ending prior to July 1, 2024, sixty

million dollars ($60,000,000).

(3) For the fiscal year beginning after June 30, 2024, and

ending prior to July 1, 2025, seventy million dollars

($70,000,000).

(4) For the fiscal year beginning after June 30, 2025, and

ending prior to July 1, 2026, eighty million dollars

($80,000,000).

(5) For the fiscal year beginning after June 30, 2026, and

ending prior to July 1, 2027, ninety million dollars

($90,000,000).

(6) For the fiscal year beginning July 1, 2027, and each

fiscal year thereafter, one hundred million dollars

($100,000,000).

* * *

(d) Nothing in this section shall be construed to increase

the rate of tax imposed under section 1102-C.

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Section 10. Section 1703-H(b)(2.3) and (5)(i) of the act are

amended to read:

Section 1703-H. Tax credit certificates.

* * *

(b) Review, recommendation and approval.--

* * *

(2.3) Any amount of tax credit certificates up to the

annual program limit of [$5,000,000] $20,000,000 not awarded

within the initial application period shall be available on a

first-come, first-served basis through a process determined

by the Department of Community and Economic Development.

* * *

(5) In granting tax credit certificates under this

article, the Department of Community and Economic

Development:

(i) Shall not grant more than [$5,000,000]

$20,000,000 in tax credit certificates in any fiscal year

exclusive of any tax credit certificates not awarded or

returned from previous fiscal years.

* * *

Section 11. Section 1704-J(b) of the act is amended to read:

Section 1704-J. Application and approval of tax credit.

* * *

(b) Amount.--Except as otherwise provided under section

1707-J, a qualified taxpayer shall receive a tax credit equal to

[$4] $8 multiplied by the tons of qualified coal refuse used to

generate electricity at an eligible facility in this

Commonwealth by a qualified taxpayer in the previous calendar

year.

* * *

Section 12. Section 1707-J(a) and (c) of the act are amended

and the section is amended by adding a subsection to read:

Section 1707-J. Limitation on tax credits.

(a) Amount.--The total amount of tax credits issued by the

department may not exceed $7,500,000 in fiscal year 2016-2017,

$10,000,000 in fiscal years 2017-2018 and 2018-2019 [and

$20,000,000 in], $20,000,000 in fiscal years 2019-2020, 2020-

2021, 2021-2022, 2022-2023 and 2023-2024 and $55,000,000

annually beginning in the 2024-2025 fiscal year and continuing

each fiscal year thereafter.

* * *

department may not grant more than [22.2%] 26.5% of the amount

under subsection (a) in tax credits to a single eligible

facility in any fiscal year.

(d) Exception.-- In a fiscal year where the full amount of

the tax credit is not utilized due to the restriction in

subsection (c), a facility not receiving the full per ton tax

credit for which the facility would otherwise be eligible shall

be provided, on a prorated basis as described in subsection (b),

up to the maximum per ton tax credit amount the facility would

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otherwise be authorized to receive under this section.

Section 13. The definitions of "city," "city revitalization

and improvement zone," "eligible tax," "municipality" and "pilot

zone" in section 1802-C of the act are amended to read:

Section 1802-C. Definitions.

The following words and phrases when used in this article

shall have the meanings given to them in this section unless the

context clearly indicates otherwise:

* * *

"City." A city of the second class A or third class or a

home rule city or a municipality with a population of at least

20,000 based on the most recent Federal decennial census. The

term does not include a city that is determined to be distressed

under the act of July 10, 1987 (P.L.246, No.47), known as the

Municipalities Financial Recovery Act.

"City revitalization and improvement zone." An area of not

more than 130 acres in a city or municipality, that may include

an area in one or more contiguous municipalities, comprised of

parcels designated by the contracting authority, which will

provide economic development and job creation within a city or

one or more contiguous municipalities.

* * *

"Eligible tax." Any of the following taxes:

(1) Corporate net income tax, capital stock and

franchise tax, bank shares tax, personal income tax paid by

shareholders, members or partners of Subchapter S

corporations, limited liability companies, partnerships or

sole proprietors on income other than passive activity income

as defined under section 469 of the Internal Revenue Code of

1986 (Public Law 99-516, 26 U.S.C. § 1 et seq.) or business

privilege tax, calculated and apportioned as to amount

attributable to the location within the zone and calculated

under section 1904-B(b) and (c).

(1.1) For a zone designated after July 1, 2024,

insurance premiums tax, calculated and apportioned as to the

amount attributable to the location within the zone and

calculated under section 1904-B(c).

(2) Amusement tax, only to the extent the tax is related

to the activity of a qualified business within the zone.

(3) Sales and use tax, only to the extent the tax is

related to the activity of a qualified business within the

zone. The term includes sales and use taxes on material used

for construction in the zone and business personal property

to be used by the qualified business in the zone.

(3.1) The hotel occupancy tax imposed under Part V of

Article II.

(4) Personal income tax withheld from its employees by a

qualified business for work performed in the zone.

(5) Local services tax withheld from its employees by a

qualified business for work performed in the zone.

(6) Earned income tax withheld from its employees by a

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qualified business for work performed in the zone.

(7) All taxes paid to the Commonwealth, or an amount

equal to all of the taxes paid to the Commonwealth, related

to the purchase or sale of liquor, wine or malt or brewed

beverages by a licensee located in the zone for purchases

that occurred outside the zone.

The term does not include cigarette tax.

* * *

"Municipality." An incorporated town, a township or a

borough. The term does not include an incorporated town, a

township or a borough that is determined to be distressed under

the Municipalities Financial Recovery Act.

* * *

"Pilot zone." An area of not more than 100 acres designated

by the contracting authority prior to July 1, 2024, following

application and approval by the Department of Community and

Economic Development, the office and the department which will

provide economic development and job creation within one or more

municipalities, with a total population of at least 7,000 based

on the most recent Federal decennial census.

* * *

Section 14. Section 1803-C of the act is amended to read:

Section 1803-C. Establishment or designation of contracting

authority.

(a) Authorization.--[Except as set forth in subsection (b),

a city, municipality or home rule county] The following shall

apply:

(1) A city, municipality or municipalities may establish

or designate a contracting authority to designate a zone

under this article.

(2) The board of directors of the contracting authority

of a zone designated after July 1, 2024, shall include:

(i) members with diverse skill sets in the areas of

government, law, finance, banking, economic development,

community development, planning, project management,

project engineering, real estate development and

environmental remediation;

(ii) residents of the zone and business owners

located in the zone; and

(iii) residents, business owners and business

representatives from the city, municipality or

municipalities that created the zone.

[(b) Distressed cities.--A city that is a distressed city

under the act of July 10, 1987 (P.L.246, No.47), known as the

Municipalities Financial Recovery Act, and is located in a home

rule county may not establish a contracting authority under this

article.

under the Municipalities Financial Recovery Act is located may

establish a contracting authority to designate a zone under this

article within the distressed city.]

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Section 15. Section 1804-C(c), (d) and (e) of the act are

amended and the section is amended by adding subsections to

read:

Section 1804-C. Approval.

* * *

(b.2) Additional approval.--Following the effective date of

this subsection, applications may be approved for:

(1) Up to two zones for one or more municipalities with

a population between 7,000 and 19,999 based on the most

recent Federal decennial census.

(2) Up to two zones for one or more cities or

municipalities with a population of 20,000 or more based on

the most recent Federal decennial census.

[(c) Approval schedule.--The Department of Community and

Economic Development shall develop a schedule for the approval

of applications under this section as follows:

(1) Following the effective date of this paragraph,

applications for two initial city revitalization and

improvement zones and one pilot zone may be approved.

(2) Beginning in 2016, applications for two additional

zones may be approved each calendar year.]

* * *

(c.2) Single approval.--An application for one zone located

in a city of the third class incorporated under optional charter

which is located in a home rule county of the third class, is

its county's seat and has a population of between 93,500 and

95,500 based on the 2020 Federal decennial census may be

approved in the first year after the effective date of this

subsection. A contracting authority designated under section

1803-C by a city of the third class incorporated under optional

charter which is located in a home rule county of the third

class, is its county's seat and has a population of between

93,500 and 95,500 based on the 2020 Federal decennial census

shall have a board of directors consisting of nine members. The

following shall apply:

(1) One voting member shall be appointed by the mayor

and shall serve a five-year term.

(2) Two voting members shall be appointed by the State

Representative of the 1st District. The following apply:

(i) One member appointed under this paragraph shall

serve a two-year term.

(ii) One member appointed under this paragraph shall

serve a five-year term.

(3) Two voting members shall be appointed by the State

Representative of the 2nd District. The following apply:

(i) One member appointed under this paragraph shall

serve a two-year term.

(ii) One member appointed under this paragraph shall

serve a three-year term.

(4) Four voting members shall be appointed by the

Senator from the 49th District.

2024/90PWK/SB0654A05533 - 12 -

(i) One member appointed under this paragraph shall

serve a two-year term.

(ii) Two members appointed under this paragraph

shall serve three-year terms.

(iii) One member appointed under this paragraph

shall serve a five-year term.

(5) Terms specified in paragraphs (1), (2), (3) and (4)

shall commence upon the date of appointment. Members may be

reappointed for five-year terms following the expiration of

the initial appointed term.

(6) Members serve without compensation.

(7) A vacancy on the board shall be filled by the same

appointing authority as the initial appointment in accordance

with paragraphs (1), (2), (3) and (4).

(d) [Time] Schedule.--The Department of Community and

Economic Development shall establish [and publish] application

deadlines [in the Pennsylvania Bulletin and] and publish the

deadlines on its publicly accessible Internet website.

(e) Reapplication.--If an application is not approved under

this section, the applicant may revise [and resubmit] the

application and plan and reapply for approval.

* * *

Section 16. Section 1809-C(a) and (b) of the act are amended

and the section is amended by adding a subsection to read:

Section 1809-C. Reports.

(a) State zone report.--No later than June 15 following the

baseline year and each year thereafter, [or by August 31 for

reports due in 2020,] each qualified business shall file a

report with the department in a form or manner required by the

department which includes all of the following:

(1) Amount of each eligible tax which was paid to the

Commonwealth by the qualified business in the prior calendar

year.

(2) Amount of each eligible tax refund received from the

Commonwealth in the prior calendar year by the qualified

business.

(3) The number of new jobs created by the qualified

business for the prior calendar year in the zone.

(4) The total wages and salaries for employees of the

qualified business for the prior calendar year in the zone.

(5) The amount of private capital investment made by the

qualified business in the prior calendar year in the zone.

(a.1) Information.--Notwithstanding any other provision of

law, the department may provide information obtained under

subsection (a)(3), (4) and (5) to the Department of Community

and Economic Development.

(b) Local zone report.--No later than June 15 following the

baseline year and for each year thereafter, [or by August 31 for

reports due in 2020,] each qualified business shall file a

report with the local taxing authority which includes all of the

following:

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(1) Amount of each eligible tax which was paid to the

local taxing authority by the qualified business in the prior

calendar year.

(2) Amount of each eligible tax refund received from the

local taxing authority in the prior calendar year by the

qualified business.

* * *

Section 16.1. Section 1812-C(a) and (c) of the act are

amended to read:

Section 1812-C. Transfers.

(a) Office.--Within ten days of receiving the certification

from the department under section 1811-C, the office shall

direct the State Treasurer to transfer the amount of certified

eligible State zone tax from the General Fund to each fund of a

contracting authority. The following shall apply:

(1) For zones designated after July 1, 2024, the office

shall direct the State Treasurer to transfer the amount of

certified eligible State zone tax up to the maximum of

$15,000,000 from the General Fund to each fund of a

contracting authority within 10 days of receiving the

certification from the department under section 1811-C.

(2) The maximum amount of certified eligible State zone

tax under paragraph (1) shall be annually adjusted beginning

July 1, 2025, and each July thereafter to reflect any upward

change in the Consumer Price Index for All Urban Consumers

(CPI-U) for the Philadelphia-Camden-Wilmington, PA-NJ-DE-MD

area for the prior 12-month period.

* * *

[(c) Notification.--The following shall apply:

(1) If the transfers under subsection (a) and section

1811-C(c) are insufficient to make payments on the bonds

issued under section 1813-C(a)(1) for the calendar year when

the transfers are made, the contracting authority shall

notify the Department of Community and Economic Development,

the office and the department of the amount of the deficiency

and may request the additional money necessary to make

payments on the bonds.

(2) The notification under paragraph (1) must be

accompanied by a detailed account of the contracting

authority's expenditures and the calculation which resulted

in the request for additional money. The Department of

Community and Economic Development, the office or the

department may request additional information from the

contracting authority and shall jointly verify the proper

amount of money necessary to make the payments on the bonds.

(3) Notwithstanding 53 Pa.C.S. § 5607(e) (relating to

purposes and powers), within 90 days of the date of the

notification request, the office shall direct the State

Treasurer to establish a restricted account within the

General Fund. The office shall direct the State Treasurer to

transfer the amount verified under paragraph (2) from the

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General Fund to the restricted account for the use of the

contracting authority to make payments on the bonds issued

under section 1813-C(a)(1).

(4) Money transferred under paragraph (3):

(i) shall be limited to 50% of the State tax

baseline amount for the calendar year prior to the date

the amount is verified under paragraph (2), not to exceed

$7,500,000; and

(ii) must occur in the first seven calendar years

following the baseline year.

(4.1) Under extraordinary circumstances, a contracting

authority may request money in excess of the limitations in

paragraph (4)(i). The Department of Community and Economic

Development, the office and the department shall determine

whether the circumstances merit additional money and the

amount to be transferred. The money shall be transferred

under the procedure under this section.

(5) Money transferred under paragraph (3) shall be

repaid to the General Fund by the contracting authority. If

money transferred under paragraph (3) is not repaid to the

General Fund by the contracting authority within 12 calendar

years following the baseline year, the city, municipality or

home rule county which established or designated the

contracting authority shall pay the money not repaid to the

General Fund plus an additional penalty of 10% of the amount

outstanding on the date of the final payment on the bonds

originally issued under section 1813-C(a)(1).]

Section 17. Section 1813-C(c)(1) of the act is amended and

the subsection is amended by adding a paragraph to read:

Section 1813-C. Restrictions.

(1) Except as set forth in paragraph [(4),] (4) or (5),

for the first five calendar years of the zone designated

after July 1, 2024, if the amount of money transferred to the

fund under sections 1811-C(c) and 1812-C in any one calendar

year exceeds the money utilized, budgeted or appropriated by

official resolution of the contracting authority under this

section in that calendar year, the contracting authority may

carry forward any excess up to a total sum of $3,000,000 for

the five-year calendar period. For the sixth calendar year

and each calendar year thereafter, if the amount of money

transferred to the fund under sections 1811-C(c) and 1812-C

in any one calendar year exceeds the money utilized, budgeted

or appropriated by official resolution of the contracting

authority under this section in that calendar year, the

contracting authority shall submit by April 15 following the

end of the calendar year any money not utilized, budgeted or

appropriated by official resolution of the contracting

authority to the State Treasurer for deposit into the General

Fund.

* * *

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(5) Other than a zone described in paragraph (1) or (4),

for a zone designation prior to July 1, 2024, if the amount

of money transferred to the fund under sections 1811-C(c) and

1812-C, in any one calendar year exceeds the money utilized,

budgeted or appropriated by official resolution of the

contracting authority under this section in that calendar

year, the contracting authority shall submit any money not

utilized, budgeted or appropriated by official resolution to

the State Treasurer for deposit into the General Fund by

April 15 of the following calendar year.

* * *

Section 18. Sections 1814-C(a) and (b) and 1819-C(a)

introductory paragraph of the act are amended to read:

Section 1814-C. Transfer of property.

(a) Property.--[Parcels in a zone] A parcel or parcels in a

zone where no zone fund dollars were expended upon the parcel or

parcels or where a facility has not been constructed,

reconstructed or renovated using money under this article may be

transferred out of the zone, if the contracting authority

provides a notarized certification, confirmed in the annual

audit required under section 1807-C(c), that no fund dollars

were used on the [property] parcel or parcels. Additional

acreage, not to exceed the acreage transferred out of the zone,

may be added to the zone.

* * *

(b) [Approval.--A transfer under subsections (a) and (a.2)

must be approved by the Department of Community and Economic

Development in consultation with the office and the department.]

Review and approval.--The following apply:

(1) A transfer may be reviewed and approved by the

Department of Community and Economic Development in

consultation with the office and the department. The

contracting authority shall submit a written request to the

Department of Community and Economic Development to approve

the transfer of a parcel or parcels. In addition to the

written request, the contracting authority shall submit the

following to the Department of Community and Economic

Development:

(i) The certification under subsection (a).

(ii) A resolution of the contracting authority board

approving the transfer of the parcel or parcels.

(iii) Any additional information as required by the

Department of Community and Economic Development, the

office or the department.

(2) A determination regarding a request to approve a

transfer of a parcel or parcels shall be made within 90 days

of receipt of the written request from the contracting

authority board.

Section 1819-C. Review.

(a) Department of Community and Economic Development.--By

December 31, 2021, and annually each March 31 thereafter, the

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Department of Community and Economic Development shall, in

cooperation with the office and the department, complete a

review and analysis of all active zones. The review shall

include an analysis of:

* * *

Section 19. The definitions of "closing date" and "rural

growth investment" in section 1822-G of the act are amended and

the section is amended by adding definitions to read:

Section 1822-G. Definitions.

The following words and phrases when used in this part shall

have the meanings given to them in this section unless the

context clearly indicates otherwise:

* * *

"Closing date." [The]

(1) With respect to program one tax credit authority,

the date on which a rural growth fund has collected all of

the amounts specified by section 1825-G.

(2) With respect to program two tax credit authority,

either:

(i) the date on which a rural growth fund has

collected all of the amounts specified under 1825-G; or

(ii) investment authority reallocated under section

1826-G(b) or 1833-G(c).

* * *

"Program one tax credit authority." Investment authority

issued by the department before January 1, 2024.

"Program two tax credit authority." Investment authority

issued by the department on or after January 1, 2024.

* * *

"Rural growth investment." A capital or equity investment in

a rural business or any loan to a rural business with a stated

maturity at least one year after the date of issuance. A secured

loan or a revolving line of credit provided to a rural business

is a rural growth investment only if the growth fund obtains an

affidavit from the president or chief executive officer or

equivalent position of the rural business attesting that the

rural business sought and was denied similar financing from a

commercial bank. The term does not include any investment used

by a rural business or its affiliates to refinance a prior rural

growth investment made with program one tax credit authority.

* * *

Section 20. Sections 1824-G(f) and 1830-G(a) of the act are

amended to read:

Section 1824-G. Rural growth funds.

* * *

(f) Limitation.--The department may not approve more than

$50,000,000 in investment authority with respect to program one

tax credit authority and $50,000,000 in investment authority

with respect to program two tax credit authority under this

part.

Section 1830-G. Claiming the tax credit.

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(a) Presentation.--

(1) Beginning July 1, 2020, with respect to program one

tax credit authority, upon presenting a tax credit

certificate to the Department of Revenue, a business firm may

claim a tax credit of up to 20% of the amount awarded under

section 1829-G for each of the taxable years that includes

the third, fourth, fifth, sixth and seventh anniversaries of

the closing date, exclusive of any tax credit amounts carried

over under section 1831-G(b).

(2) Beginning July 1, 2024, with respect to program two

tax credit authority, upon presenting a tax credit

certificate to the Department of Revenue, a business firm may

claim a tax credit of up to 20% of the amount awarded under

section 1829-G for each of the taxable years that includes

the third, fourth, fifth , sixth and seventh anniversaries of

the closing date, exclusive of any tax credit amounts carried

over under section 1831-G(b).

* * *

Section 21. Section 1833-G(a)(4) of the act is amended and

the section is amended by adding a subsection to read:

Section 1833-G. Revocation of tax credit certificates.

(a) Revocation.--The department shall revoke a tax credit

certificate awarded under section 1829-G if any of the following

occur with respect to a rural growth fund before the rural

growth fund exits the program under section 1834-G:

* * *

(4) The following apply:

(i) With respect to program one tax credit

authority, the rural growth fund invests more than 20% of

its investment authority, exclusive of receipts or

redeemed rural growth investments, in the same rural

business, including amounts invested in affiliates of the

rural business.

(ii) With respect to program two tax credit

authority, the rural growth fund invests more than

$5,000,000 of its investment authority, exclusive of

receipts or redeemed rural growth investments, in the

same rural business, including amounts invested in

affiliates of the rural business.

* * *

(d) Rural growth investment cap.--With respect to any one

rural business, the maximum amount of rural growth investments

made in that business, on a collective basis with all of its

affiliates that may be counted toward the satisfaction of

subsection (a), shall be $15,000,000, exclusive of receipts of

redeemed rural growth investments.

Section 22. Sections 1904-A(c) and 1905-A(a) of the act are

amended to read:

Section 1904-A. Tax Credit.--* * *

approved under this act shall not exceed [thirty-six million

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dollars ($36,000,000)] seventy-two million dollars ($72,000,000)

of tax credit in any fiscal year.

* * *

Section 1905-A. Grant of Tax Credit.--(a) The Department of

Revenue shall grant a tax credit against any tax due under

Article III, IV, VI, VII, VIII, IX or XV of this act, or any tax

substituted in lieu thereof in an amount which shall not exceed

[fifty-five] sixty-five per cent of the total amount contributed

during the taxable year by a business firm or twenty-five per

cent of qualified investments by a private company in programs

approved pursuant to section 1904-A of this act: Provided, That

a tax credit of up to [seventy-five] ninety per cent of the

total amount contributed during the taxable year by a business

firm or up to thirty-five per cent of the amount of qualified

investments by a private company may be allowed for investment

in programs where activities fall within the scope of special

program priorities as defined with the approval of the Governor

in regulations promulgated by the secretary, and Provided

further, That a tax credit of up to [seventy-five] ninety per

cent of the total amount contributed during the taxable year by

a business firm in comprehensive service projects with five-year

commitments and up to [eighty] ninety-five per cent of the total

amount contributed during the taxable year by a business firm in

comprehensive service projects with six-year or longer

commitments shall be granted, and Provided further, That a tax

credit of up to [seventy-five] ninety per cent of the total

amount contributed during the taxable year by a business firm in

veterans' housing assistance approved under section 1904-A(b.3)

shall be granted. Such credit shall not exceed [five hundred

thousand dollars ($500,000)] one million dollars ($1,000,000)

annually for contributions or investments to fewer than four

projects or [one million two hundred fifty thousand dollars

($1,250,000)] two million five hundred thousand dollars

($2,500,000) annually for contributions or investments to four

or more projects. No tax credit shall be granted to any bank,

bank and trust company, insurance company, trust company,

national bank, savings association, mutual savings bank or

building and loan association for activities that are a part of

its normal course of business. Any tax credit not used in the

period the contribution or investment was made may be carried

over for the next five succeeding calendar or fiscal years until

the full credit has been allowed. A business firm shall not be

entitled to carry back or obtain a refund of an unused tax

credit. The total amount of all tax credits allowed pursuant to

this act shall not exceed [thirty-six million dollars

($36,000,000)] seventy-two million dollars ($72,000,000) in any

one fiscal year. Of that amount, two million dollars

($2,000,000) shall be allocated exclusively for pass-through

entities. However, if the total amounts allocated to either the

group of applicants, exclusive of pass-through entities, or the

group of pass-through entity applicants is not approved in any

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fiscal year, the unused portion shall become available for use

by the other group of qualifying taxpayers.

* * *

Section 23. The act is amended by adding articles to read:

ARTICLE XIX-J

529 SAVINGS ACCOUNT EMPLOYER

MATCHING CONTRIBUTION TAX CREDIT

Section 1901-J. Scope of article.

This article relates to the 529 savings account employer

matching contribution tax credit program.

Section 1902-J. Definitions.

The following words and phrases when used in this article

have the meanings given to them in this section unless the

context clearly indicates otherwise:

"ABLE account." An account under the act of April 18, 2016

(P.L.128, No.17), known as the Pennsylvania ABLE Act.

"ABLE account contract." As defined in section 102 of the

Pennsylvania ABLE Act.

"Account." An account owned by an employee who has entered

into a Tuition Account Program Contract under the act of April

3, 1992 (P.L.28, No.11), known as the Tuition Account Programs

and College Savings Bond Act, or an ABLE account contract, or a

tuition account program contract or an ABLE account program

administered by another state, notwithstanding the named

beneficiary of the account.

"Department." The Department of Revenue of the Commonwealth.

"Matching contribution." A deposit of money by an employer

into an employee-owned account during the tax year that does not

exceed the amount of deposits made into that account by the

employee during the same tax year.

" Pass-through entity. " Any of the following:

(1) A partnership as defined in section 301(n.0).

(2) A Pennsylvania S corporation as defined in section

301(n.1).

(3) An unincorporated entity subject to section 307.21.

" State tax liability. " Any of the taxes due under Article

III, IV, VII, VIII, IX or XV. The term shall not include any tax

withheld by an employer from an employee under Article III.

"Tax credit." The 529 savings account employer matching

contribution tax credit established under section 1903-J.

"Tuition Account Program Contract." As defined in section

302 of the Tuition Account Programs and College Savings Bond

Act.

Section 1903-J. Credit for employer matching contributions to

tuition savings accounts and ABLE accounts .

(a) Tax credit.--For taxable years beginning after December

31, 2024 , and ending before January 1, 2030 , an employer that

makes a matching contribution to an account owned by an employee

under this article or an ABLE account may claim a tax credit

against the employer's State tax liability.

(b) Amount of tax credit.--The amount of the tax credit

2024/90PWK/SB0654A05533 - 20 -

under subsection (a) shall be equal to 25% of the employer's

aggregate matching contributions made to accounts owned by

employees during the tax year.

matching contributions to accounts owned by employees for which

an employer may claim a tax credit shall be no more than $500

per employee during the tax year.

(d) Proof of matching contribution.--In order to receive the

tax credit, an employer shall provide the department with proof

that the employer has made qualifying matching contributions to

employee-owned accounts under this article at the time of filing

the employer's tax return.

(e) Proof of employee contribution.--In a manner prescribed

by the employer, an employee shall provide to the employer

evidence of the total amount deposited into the employee's

account during the previous tax year.

Section 1904-J. Carryover, carryback , assignment and pass-

through of credit.

(a) General rule.--If the amount of the tax credit allowed

under this article exceeds the employer's tax liability in the

tax year in which the tax credit is approved, the excess tax

credit may be carried over to succeeding tax years for a period

not to exceed three years to reduce the employer's tax liability

during those tax years. The following shall apply:

(1) A tax credit that is carried over to succeeding tax

years must be applied first to the earliest tax year

possible.

(2) Any credit remaining after three tax years following

the initial approval of a tax credit under this article shall

not be refunded or credited to the employer.

(b) No carryback or refund.--An employer approved for a tax

credit is not entitled to carry back or obtain a refund of all

or any portion of an unused tax credit granted to the employer

under this article.

entity and has an unused tax credit under section 1903-J, the

employer may elect in writing, according to procedures

established by the department, to transfer all or a portion of

the credit to shareholders, members or partners in proportion to

the share of the entity's distributive income to which the

shareholder, member or partner is entitled. The following apply:

(1) The same unused tax credit under subsection (b) may

not be claimed by:

(i) the pass-through entity; and

(ii) a shareholder, member or patron of the pass-

through entity.

(2) A shareholder, member or partner of a pass-through

entity to whom a credit is transferred under this subsection

shall immediately claim the credit in the taxable year in

which the transfer is made. The shareholder, member or

partner may not carry forward, carry back, obtain a refund of

2024/90PWK/SB0654A05533 - 21 -

or sell or assign the credit.

Section 1905-J. Departmental duties.

The department shall publish guidelines and may promulgate

regulations necessary for the implementation and administration

of this article.

Section 1906-J. Nondiscrimination in matching contributions.

(a) Accounts owned by employees.--An employee who owns an

account shall have equal opportunity to receive a matching

contribution from the employer.

(b) Duty of employers.--If an employer chooses to make

matching contributions to employee-owned accounts for the

purposes of claiming the tax credit, the employer shall make

equal matching contributions during the tax year to any employee

that either owns an account or chooses to open an account while

employed by the employer.

may voluntarily opt out of an employer matching contribution

benefit during any tax year. An employee who opts out of a

matching contribution benefit from the employer during one tax

year may elect to receive the matching contribution benefit

during another succeeding tax year.

Section 1907-J. Report to General Assembly.

(a) Annual report.--No later than July 1, 2025, and each

July 1 thereafter, the department shall submit a report to the

General Assembly indicating the effectiveness of the tax credit

under this article.

(b) Information required.--The report required under

subsection (a) shall include the following information:

(1) The number of tax credits approved under this

article.

(2) The amount of tax credits approved under this

article.

(3) The number of tax credits denied and the reason for

denial.

ARTICLE XIX-K

EMPLOYER CHILD CARE CONTRIBUTION TAX CREDIT

Section 1901-K. Scope of article.

This article establishes the Employer Child Care Contribution

Tax Credit.

Section 1902-K. Definitions.

The following words and phrases when used in this article

shall have the meanings given to them in this section unless the

context clearly indicates otherwise:

"Aggregate contribution." The aggregate contribution that a

qualified taxpayer makes to all employees during the taxable

year for which the qualified taxpayer seeks the employer child

care contribution tax credit established under this article,

provided that only the first $500 in contributions per employee

shall count toward the aggregate contribution.

"Child-care provider." Includes:

(1) A child-care center as defined under 55 Pa. Code §

2024/90PWK/SB0654A05533 - 22 -

3270.4 (relating to definitions).

(2) A group child-care home as defined under 55 Pa. Code

§ 3280.4 (relating to definitions).

(3) A family child-care home as defined under 55 Pa.

Code § 3290.4 (relating to definitions).

"Contribution." A payment made to a child-care provider by

an employer to subsidize an employee's eligible child-care

costs.

"Department." The Department of Revenue of the Commonwealth.

"Eligible child-care costs." Costs incurred by an employee

for services rendered by a child-care provider that are incurred

to enable the employee to be gainfully employed by a qualified

taxpayer.

"Employee." An individual employed by a qualified taxpayer.

The term shall not include:

(1) An officer of an entity subject to tax under Article

IV, VII, VIII or XV.

(2) An officer of an insurance company subject to tax

under Article IX.

"Pass-through entity." Any of the following:

(1) A partnership as defined in section 301(n.0).

(2) A Pennsylvania S corporation as defined in section

301(n.1).

(3) An unincorporated entity subject to section 307.21.

"Qualified tax liability." Any of the taxes due under

Article III, IV, VII, VIII or XV. The term shall not include any

tax withheld by an employer from an employee under Article III.

"Qualified taxpayer." An individual, partnership,

association, corporation, governmental body or unit or agency or

other entity that:

(1) is subject to a tax imposed under Article III, IV,

VII, VIII, IX or XV; and

(2) is required under the Internal Revenue Code of 1986

(Public Law 99-514, 26 U.S.C. § 1 et seq.) to withhold

Federal income tax from wages paid to an employee.

Section 1903-K. Employer child care contribution tax credit.

(a) General rule.--For taxable years beginning after

December 31, 2024, a qualified taxpayer may claim the employer

child care contribution tax credit for a contribution made

during the taxable year toward an employee's eligible child-care

costs and may apply the tax credit against its qualified tax

liability.

(b) Application.--A qualified taxpayer applying to claim an

employer child care contribution tax credit must complete and

submit to the department a child care contribution tax credit

application on a form and in a manner as determined by the

department. The form shall require the qualified taxpayer to

provide the following:

(1) The names, addresses and Social Security numbers of

all employees to which the qualified taxpayer made a

contribution during the taxable year.

2024/90PWK/SB0654A05533 - 23 -

(2) The names, addresses and employer identification

numbers of the child-care providers that provided child-care

services to each participating employee.

(3) The amount contributed to each participating

employee.

(4) The aggregate contribution.

under subsection (a) shall be equal to 30% of the aggregate

contribution made to employees during the tax year.

Section 1904-K. Carryover, carryback, refund and assignment of

credit.

(a) Carryover, carryback and refund.--A qualified taxpayer

is not entitled to carry forward, carry back or obtain a refund

of all or a portion of an unused tax credit granted to the

qualified taxpayer under this article.

(b) Sale or assignment of tax credit.--A qualified taxpayer

may not sell or assign a tax credit granted to the qualified

taxpayer under this article.

Section 1905-K. Pass-through entity.

(a) Election.--If the qualified taxpayer is a pass-through

entity, the qualified taxpayer may elect in writing, according

to procedures established by the department, to transfer all or

a portion of the credit to shareholders, members or partners in

proportion to the share of the qualified taxpayer's distributive

income to which the shareholders, members or partners are

entitled or in any other manner designated by the qualified

taxpayer in accordance with its governance documents and without

regard to how distributive income, losses or credits are

allocated for other tax purposes.

(b) Limitation.--The same unused tax credit under subsection

(a) may not be claimed by:

(1) the pass-through entity; and

(2) a shareholder, member or partner of the pass-through

entity.

through entity under subsection (a) may only use a tax credit

during a taxable year for which use of the credit is authorized.

The shareholder, member or partner of the pass-through entity

may not carry forward, carry back, obtain a refund of or sell or

assign the tax credit.

Section 1906-K. Exclusion from classes of income.

Notwithstanding any other provision of law, contributions

made under this article to an employee's eligible child-care

costs during the taxable year may not be included in any of the

classes of income enumerated under section 303.

Section 1907-K. Nondiscrimination in contributions.

(a) Employees.--An employee who has incurred eligible child-

care costs shall have equal opportunity to receive a

contribution from the employer.

(b) Duty of employers.--If an employer chooses to make

contributions to a child-care provider for the purposes of

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claiming the tax credit, the employer shall make equal

contributions during the tax year to any employee that has

eligible child-care costs.

Section 1908-K. Regulations.

(a) Promulgation.--The department shall promulgate

regulations to implement the provisions of this article.

(b) Guidelines.--The department shall develop written

guidelines for the implementation of this article. The

guidelines shall be in effect until the department promulgates

regulations for the implementation of the provisions of this

article.

Section 1909-K. Tax compliance.

The provisions of Article XVII-A.1 apply to the application

of this article.

Section 1910-K. Applicability.

The provisions of this article shall apply to taxable years

beginning after December 31, 2024.

Section 24. Section 2901-D of the act is amended by adding

definitions to read:

Section 2901-D. Definitions.

The following words and phrases when used in this article

shall have the meanings given to them in this section unless the

context clearly indicates otherwise:

"Blockchain." A distributed ledger technology in which the

data is:

(1) shared across a network that creates a digital

ledger of verified transactions or information among network

participants; and

(2) typically linked using cryptography to maintain the

integrity of the digital ledger and execute other functions,

including the transfer of ownership or value.

* * *

"Proof of work crypto-asset mining." The process of

performing computations to add a valid block of data to a

blockchain, excluding computations required to validate

individual transactions, typically in exchange for a reward or

fee.

* * *

Section 25. Section 2931-D(c)(2) of the act is amended by

adding a subparagraph to read:

Section 2931-D. Sales and use tax exemption.

* * *

exemption:

* * *

(2) Computer data center equipment used by the certified

computer data center for any of the following purposes:

* * *

(iii) Proof of work crypto-asset mining.

* * *

Section 26. The act is amended by adding an article to read:

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ARTICLE XXIX-I

TUITION ACCOUNT PROGRAMS

Section 2901-I. Definitions.

The following words and phrases when used in this article

shall have the meanings given to them in this section unless the

context clearly indicates otherwise:

"Account." As defined in section 302 of the act of April 3,

1992 (P.L.28, No.11), known as the Tuition Account Programs and

College Savings Bond Act.

"Account owner." As defined in section 302 of the Tuition

Account Programs and College Savings Bond Act.

"Beneficiary." As defined in section 302 of the Tuition

Account Programs and College Savings Bond Act.

" Tuition Account Program Contract." As defined in section

302 of the Tuition Account Programs and College Savings Bond

Act.

Section 2902-I. Fees.

Notwithstanding section 313(c) of the act of April 3, 1992

(P.L.28, No.11), known as the Tuition Account Programs and

College Savings Bond Act, the Treasury Department may not impose

a fee on the termination of an account if the termination was a

result of the death or disability of the beneficiary.

Section 2903-I. Taxation of payment.

Notwithstanding section 313(d) of the act of April 3, 1992

(P.L.28, No.11), known as the Tuition Account Programs and

College Savings Bond Act, if a Tuition Account Program Contract

is terminated under section 313(a) of the Tuition Account

Programs and College Savings Bond Act, a payment received by an

account owner from the Treasury Department shall not be

considered in the classes of income under section 303 for the

purpose of computing the tax under Article III.

Section 27. The amendment of section 701.1(b), (b.1) and (c)

of the act shall apply to the ascertainment of the taxable

amount of shares after December 31, 2024, and to the report and

the payment of the bank and trust company shares tax due after

March 14, 2025.

Section 28. The General Assembly finds and declares as

follows:

(1) The amendment of section 701.1(b), (b.1) and (c) of

the act shall not be relied upon to:

(i) ascertain the taxable amount of shares for a

period prior to January 1, 2025;

(ii) ascertain the amount of tax due prior to March

15, 2025; or

(iii) authorize a refund of a tax paid for a period

for which a report was due prior to March 15, 2025,

beyond the extent to which the refund would have

otherwise been due notwithstanding the amendment of

section 701.1(b), (b.1) and (c) of the act.

(2) In ascertaining the taxable amount of shares for a

period prior to January 1, 2025, the amount of goodwill

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subtracted and disregarded in calculating the deduction for

United States obligations under section 701.1(b) of the act,

and the amount of goodwill deducted from the taxable amount

of shares under section 701.1(b.1) of the act, shall be

determined based on the law as in effect prior to the

effective date of this section, without any inference that

the amendment of section 701.1(b), (b.1) and (c) of the act

expanded, or confirmed any administrative determination that

limited or restricted, the extent to which goodwill could be

subtracted and disregarded under section 701.1(b) of the act

or deducted under section 701.1(b.1) of the act.

Section 29. A computer data center that has met the

eligibility requirements and has been certified under Article

XXIX-D prior to the effective date of this section shall be

deemed to meet the certification requirements of Article XXIX-D.

The certification may not be revoked, except as provided under

section 2917-D of the act, and shall remain in effect for the

remainder of the qualification period, as defined in section

2931-D(d).

Section 30. The amendment, addition or repeal of the

following sections of the act shall apply as follows:

(1) Section 204(76) shall apply to transactions

occurring after September 30, 2024.

(2) Sections 301(o.5) and (t.1) shall apply to taxable

years commencing after December 31, 2023.

(3) Section 303(a.7)(7) shall apply to taxable years

commencing after December 31, 2022.

(4) Section 303 (a.11) shall apply to taxable years

commencing after December 31, 2024.

(5) Section 303(a.12) shall apply to taxable years

commencing after December 31, 2023.

(6) Section 401(3)1(b.2) shall apply to taxable years

commencing after December 31, 2023.

(7) Section 401(3)1(u) shall apply to taxable years

commencing after December 31, 2022.

(8) Section 1703-H(b) shall apply to fiscal years

beginning after June 30, 2024.

(9) Sections 1704-J(b), 1707-J(a), (c) and (d), 1904-

A(c) and 1905-A(a) shall apply to fiscal years beginning

after June 30, 2024.

(10) Sections 1822-G, 1824-G, 1830-G and 1833-G shall

apply to fiscal years beginning after June 30, 2024.

(11) Articles XIX-J and XIX-K shall apply to taxable

years commencing after December 31, 2024.

(12) Sections 2901-D and 2931-D(c)(2)(iii) shall apply

to taxable years commencing after December 31, 2025.

Section 31. This act shall take effect as follows:

(1) The following shall take effect immediately:

(i) The amendment, addition or repeal of the

following:

(A) Section 204(76) of the act.

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(B) Section 301(o.5) and (t.1) of the act.

and (a.12) of the act.

(D) Section 360.1 of the act.

(E) Section 401(3)1(b.2) and (u) of the act.

(F) Section 401.1 of the act.

(G) Section 701.1(b), (b.1) and (c) of the act.

(H) Section 1102-C.6(a), (b) and (d) of the act.

(I) Sections 1704-J(b) and 1707-J(a), (c) and

(d) of the act.

(J) Sections 1802-C, 1803-C, 1804-C(b.2), (c),

(c.2), (d) and (e), 1809-C(a) and (b), 1812-C(a) and

(c), 1813-C(c)(1) and (5), 1814-C(a) and (b) and

1819-C(a) introductory paragraph of the act.

(K) Sections 1822-G, 1824-G, 1830-G and 1833-G

of the act.

(L) Sections 1904-A(c) and 1905-A(a) of the act.

(M) Articles XIX-J, XIX-K and XXIX-I of the act.

(ii) This section and sections 27, 28, 29 and 30 of

this act.

(2) The amendment of section 2901-D and 2931-D(c)(2)

(iii) shall take effect December 31, 2025.

(3) The remainder of this act shall take effect in 60

days.

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