SENATE AMENDED
PRIOR PRINTER'S NOS. 1316, 3148 PRINTER'S NO. 3382
No. 1172 Session of 1979
INTRODUCED BY POTT, VROON, PYLES, MOEHLMANN, KNEPPER AND
BRUNNER, MAY 2, 1979
AS AMENDED ON SECOND CONSIDERATION, IN SENATE, MAY 20, 1980
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 filing of documents and
11 payment of taxes with respect to taxes imposed for education,
12 personal income taxes and corporate net income taxes AND <--
13 PROVIDING FOR THE DEDUCTION AND CARRYOVER OF NET OPERATING
14 LOSS IN DETERMINING TAXABLE INCOME FOR CORPORATE INCOME
15 TAXES.
16 The General Assembly of the Commonwealth of Pennsylvania
17 hereby enacts as follows:
18 Section 1. Sections 220 AND 336 and 403.1, act of March 4, <--
19 1971 (P.L.6, No.2), known as the "Tax Reform Code of 1971,"
20 amended June 27, 1974 (P.L.376, No.126), are amended to read:
21 Section 220. Timely Mailing Treated as Timely Filing and
22 Payment.--Notwithstanding the provisions of any State tax law to
23 the contrary, whenever a report, petition or payment of all or
24 any portion of a State tax is required by law to be received by
1 the Pennsylvania Department of Revenue or Board of Finance and
2 Revenue or other agency of the Commonwealth on or before a day
3 certain, the taxpayer shall be deemed to have complied with such
4 law if the letter transmitting the report, petition or payment
5 of such tax which has been received by the department or Board
6 of Finance and Revenue is postmarked by the United States Postal
7 Service on or prior to the final day on which the report,
8 petition or payment is to be received. Notwithstanding the
9 provisions of any State tax law to the contrary, whenever the
10 due date for timely filing shall fall on a Saturday, Sunday, or
11 a legal holiday, the timely filing date shall be continued to
12 midnight of the first full business day following.
13 For the purposes of this article, presentation of a receipt
14 indicating that the report, petition or payment was mailed by
15 registered or certified mail on or before the due date shall be
16 evidence of timely filing and payment.
17 Section 336. Timely Mailing Treated as Timely Filing and
18 Payment.--Notwithstanding the provisions of any State tax law to
19 the contrary, whenever a report, petition or payment of all or
20 any portion of a State tax is required by law to be received by
21 the Pennsylvania Department of Revenue, Board of Finance and
22 Revenue or other agency of the Commonwealth on or before a day
23 certain, the taxpayer shall be deemed to have complied with such
24 law if the letter transmitting the report, petition or payment
25 of such tax which has been received by the department or Board
26 of Finance and Revenue is postmarked by the United States Postal
27 Service on or prior to the final day on which the report,
28 petition or payment is to be received. Notwithstanding the
29 provisions of any State tax law to the contrary, whenever the
30 due date for timely filing shall fall on a Saturday, Sunday, or
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1 a legal holiday, the timely filing date shall be continued to
2 midnight of the first full business day following.
3 For the purposes of this article, presentation of a receipt
4 indicating that the report, petition or payment was mailed by
5 registered or certified mail on or before the due date shall be
6 evidence of timely filing and payment.
7 SECTION 2. SUBCLAUSE 1 OF CLAUSE (3) OF SECTION 401 OF THE <--
8 ACT, AMENDED NOVEMBER 26, 1978 (P.L.1287, NO.306), IS AMENDED TO
9 READ:
10 SECTION 401. DEFINITIONS.--THE FOLLOWING WORDS, TERMS, AND
11 PHRASES, WHEN USED IN THIS ARTICLE, SHALL HAVE THE MEANING
12 ASCRIBED TO THEM IN THIS SECTION, EXCEPT WHERE THE CONTEXT
13 CLEARLY INDICATES A DIFFERENT MEANING:
14 * * *
15 (3) "TAXABLE INCOME." 1. IN CASE THE ENTIRE BUSINESS OF THE
16 CORPORATION IS TRANSACTED WITHIN THIS COMMONWEALTH, FOR ANY
17 TAXABLE YEAR WHICH BEGINS ON OR AFTER JANUARY 1, 1971, TAXABLE
18 INCOME FOR THE CALENDAR YEAR OR FISCAL YEAR AS RETURNED TO AND
19 ASCERTAINED BY THE FEDERAL GOVERNMENT, OR IN THE CASE OF A
20 CORPORATION PARTICIPATING IN THE FILING OF CONSOLIDATED RETURNS
21 TO THE FEDERAL GOVERNMENT, THE TAXABLE INCOME WHICH WOULD HAVE
22 BEEN RETURNED TO AND ASCERTAINED BY THE FEDERAL GOVERNMENT IF
23 SEPARATE RETURNS HAD BEEN MADE TO THE FEDERAL GOVERNMENT FOR THE
24 CURRENT AND PRIOR TAXABLE YEARS, SUBJECT, HOWEVER, TO ANY
25 CORRECTION THEREOF, FOR FRAUD, EVASION, OR ERROR AS FINALLY
26 ASCERTAINED BY THE FEDERAL GOVERNMENT: PROVIDED, THAT ADDITIONAL
27 DEDUCTIONS SHALL BE ALLOWED FROM TAXABLE INCOME ON ACCOUNT OF
28 ANY DIVIDENDS RECEIVED FROM ANY OTHER CORPORATION BUT ONLY TO
29 THE EXTENT THAT SUCH DIVIDENDS ARE INCLUDED IN TAXABLE INCOME AS
30 RETURNED TO AND ASCERTAINED BY THE FEDERAL GOVERNMENT: PROVIDED
19790H1172B3382 - 3 -
1 FURTHER, THAT ADDITIONAL DEDUCTIONS SHALL BE ALLOWED FROM
2 TAXABLE INCOME IN AN AMOUNT EQUAL TO THE AMOUNT OF ANY REDUCTION
3 IN AN EMPLOYER'S DEDUCTION FOR WAGES AND SALARIES AS REQUIRED BY
4 SECTION 280C OF THE INTERNAL REVENUE CODE AS A RESULT OF THE
5 EMPLOYER TAKING A CREDIT FOR "NEW JOBS" PURSUANT TO SECTION 44B
6 OF THE INTERNAL REVENUE CODE: PROVIDED FURTHER, THAT TAXABLE
7 INCOME WILL INCLUDE THE SUM OF THE FOLLOWING TAX PREFERENCE
8 ITEMS AS DEFINED IN SECTION 57 OF THE INTERNAL REVENUE CODE, AS
9 AMENDED, (I) EXCESS INVESTMENT INTEREST; (II) ACCELERATED
10 DEPRECIATION ON REAL PROPERTY; (III) ACCELERATED DEPRECIATION ON
11 PERSONAL PROPERTY SUBJECT TO A NET LEASE; (IV) AMORTIZATION OF
12 CERTIFIED POLLUTION CONTROL FACILITIES; (V) AMORTIZATION OF
13 RAILROAD ROLLING STOCK; (VI) STOCK OPTIONS; (VII) RESERVES FOR
14 LOSSES ON BAD DEBTS OF FINANCIAL INSTITUTIONS; (VIII) AND
15 CAPITAL GAINS BUT ONLY TO THE EXTENT THAT SUCH PREFERENCE ITEMS
16 ARE NOT INCLUDED IN "TAXABLE INCOME" AS RETURNED TO AND
17 ASCERTAINED BY THE FEDERAL GOVERNMENT. NO DEDUCTION SHALL BE
18 ALLOWED FOR NET OPERATING LOSSES SUSTAINED BY THE CORPORATION
19 DURING ANY OTHER FISCAL OR CALENDAR YEAR: PROVIDED, THAT FOR THE
20 CALENDAR YEAR 1980 AND FISCAL YEARS BEGINNING IN 1980 AND
21 THEREAFTER, A NET OPERATING LOSS, AS PROVIDED BY SECTION 172 OF
22 THE INTERNAL REVENUE CODE, SHALL BE ALLOWED AS A DEDUCTION AND A
23 CARRYOVER PURSUANT TO THE FOLLOWING SCHEDULE:
24 NET OPERATING LOSS FOR YEAR CARRYOVER
25 1980 1 YEAR
26 1981 2 YEARS
27 1982 AND THEREAFTER 3 YEARS
28 THE NET OPERATING LOSS SHALL BE CARRIED TO THE EARLIEST OF THE
29 TAXABLE YEARS TO WHICH, UNDER THIS SCHEDULE, SUCH LOSS MAY FIRST
30 BE CARRIED. IN THE CASE OF REGULATED INVESTMENT COMPANIES AS
19790H1172B3382 - 4 -
1 DEFINED BY THE INTERNAL REVENUE CODE OF 1954, AS AMENDED,
2 "TAXABLE INCOME" SHALL BE INVESTMENT COMPANY TAXABLE INCOME AS
3 DEFINED IN THE AFORESAID INTERNAL REVENUE CODE OF 1954, AS
4 AMENDED. IN ARRIVING AT "TAXABLE INCOME" FOR FEDERAL TAX
5 PURPOSES FOR ANY TAXABLE YEAR BEGINNING ON OR AFTER JANUARY 1,
6 1971, ANY CORPORATE NET INCOME TAX DUE TO THE COMMONWEALTH
7 PURSUANT TO THE PROVISIONS OF THIS ARTICLE SHALL NOT BE ALLOWED
8 AS A DEDUCTION AND THE AMOUNT OF CORPORATE TAX SO DUE AND
9 EXCLUDED FROM FEDERAL TAXABLE INCOME UNDER THE INTERNAL REVENUE
10 CODE SHALL NOT BE APPORTIONED BUT SHALL BE SUBJECT TO TAX AT THE
11 RATE IMPOSED UNDER THIS ARTICLE.
12 * * *
13 SECTION 3. SECTION 403.1 OF THE ACT, AMENDED JUNE 27, 1974
14 (P.L.376, NO.126), IS AMENDED TO READ:
15 Section 403.1. Timely Mailing Treated as Timely Filing and
16 Payment.--Notwithstanding the provisions of any State tax law to
17 the contrary, whenever a report, petition or payment of all or
18 any portion of a State tax is required by law to be received by
19 the Pennsylvania Department of Revenue, Board of Finance and
20 Revenue or other agency of the Commonwealth on or before a day
21 certain, the corporation shall be deemed to have complied with
22 such law if the letter transmitting the report, petition or
23 payment of such tax which has been received by the department or
24 Board of Finance and Revenue is postmarked by the United States
25 Postal Service on or prior to the final day on which the report,
26 petition or payment is to be received. Notwithstanding the
27 provisions of any State tax law to the contrary, whenever the
28 due date for timely filing shall fall on a Saturday, Sunday, or
29 a legal holiday, the timely filing date shall be continued to
30 midnight of the first full business day following.
19790H1172B3382 - 5 -
1 For the purposes of this article, presentation of a receipt
2 indicating that the report, petition or payment was mailed by
3 registered or certified mail on or before the due date shall be
4 evidence of timely filing and payment.
5 Section 2 4. This act shall take effect immediately AND <--
6 SECTIONS 1 AND 3 SHALL BE RETROACTIVE TO JUNE 27, 1974 AND
7 SECTION 2 SHALL APPLY TO TAXABLE YEARS BEGINNING ON OR AFTER
8 JANUARY 1, 1980.
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