PRINTER'S NO. 651
No. 586 Session of 1997
INTRODUCED BY HABAY, YOUNGBLOOD, BROWNE, BOYES, DEMPSEY,
HUTCHINSON, NAILOR, FAIRCHILD, TRELLO, JAMES, SAYLOR, ALLEN,
GIGLIOTTI, THOMAS, LAUGHLIN, READSHAW, WALKO, BROWN,
MAYERNIK, MAITLAND, M. N. WRIGHT, RUBLEY, FLEAGLE, SCHULER,
JADLOWIEC, VAN HORNE, CAPPABIANCA, SATHER, SEMMEL, FEESE,
HARHART, CORRIGAN, E. Z. TAYLOR, GANNON, BATTISTO, McCALL,
RAMOS, COLAFELLA, DENT, BOSCOLA, GLADECK, WAUGH,
D. W. SNYDER, CARONE, MILLER, TRUE, ITKIN, STRITTMATTER,
B. SMITH, TRICH, CIVERA, STAIRS, FARGO, GEIST, FLICK,
L. I. COHEN, RAYMOND, HENNESSEY, GORDNER, EACHUS AND
MICOZZIE, FEBRUARY 13, 1997
REFERRED TO COMMITTEE ON FINANCE, FEBRUARY 13, 1997
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," providing for a student apprenticeship tax
11 credit.
12 The General Assembly of the Commonwealth of Pennsylvania
13 hereby enacts as follows:
14 Section 1. The act of March 4, 1971 (P.L.6, No.2), known as
15 the Tax Reform Code of 1971, is amended by adding an article to
16 read:
17 ARTICLE XXII
18 STUDENT APPRENTICESHIP TAX CREDIT
1 Section 2201. Short Title.--This article shall be known and
2 may be cited as the "Student Apprenticeship Tax Credit Act."
3 Section 2202. Intent.--It is the intent of the General
4 Assembly to provide incentives for business-education
5 partnerships to encourage the growth of student apprenticeship
6 programs and to encourage businesses to provide apprenticeship
7 opportunities.
8 Section 2203. Definitions.--The following words, terms and
9 phrases, when used in this article shall have the meaning
10 ascribed to them in this section except where the context
11 clearly indicates a different meaning.
12 "Employe." Any individual:
13 (1) From whose wages an employer is required under the
14 Internal Revenue Code of 1986 (Public Law 99-514, 26 U.S.C. § 1
15 et seq.) to withhold Federal income tax.
16 (2) Whose service is performed entirely within this
17 Commonwealth or whose service outside of this Commonwealth is
18 incidental to the individual's service within this Commonwealth.
19 Employer." A partnership, association, corporation or other
20 entity which is required under the Internal Revenue Code of 1986
21 (Public Law 99-514, 26 U.S.C. § 1 et seq.) to withhold Federal
22 income tax from wages paid to an employe.
23 "Internal Revenue Code." The Internal Revenue Code of 1986
24 (Public Law 99-514, 26 U.S.C. § 1 et seq.), as amended to the
25 date on which this article is effective.
26 "This state." The Commonwealth of Pennsylvania.
27 "Pennsylvania qualified apprenticeship expense." The wages
28 paid to employes who are students enrolled in student
29 apprenticeship programs if the employment is part of the
30 apprenticeship program.
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1 "Qualified tax liability." The liability for taxes imposed
2 under Articles III, IV and VI of this act. The term shall not
3 include any taxes withheld from the compensation of an employe
4 pursuant to section 316 of this act.
5 "Qualified taxpayer." An employer subject to tax under
6 Articles III, IV or VI of this act.
7 Section 2204. Credit for student apprenticeship programs.--A
8 qualified taxpayer who incurs Pennsylvania qualified
9 apprenticeship expense in a taxable year is entitled to a
10 student apprenticeship tax credit as provided in this article.
11 Section 2205. Amount of tax credit.--The credit provided by
12 this article shall be twenty per cent of the employer's
13 Pennsylvania qualified apprenticeship expense, but not more than
14 five hundred dollars ($500) per employe.
15 Section 2206. Administration.--The Department of Revenue, in
16 cooperation with the Department of Labor and Industry, shall
17 administer the provisions of this article, promulgate
18 appropriate rules, regulations and forms for that purpose and
19 make such determinations as may be required. Determinations made
20 with respect to the student apprenticeship tax credit provided
21 in this article may be reviewed and appealed in the manner
22 provided by law for other corporate or personal tax credits.
23 Section 2207. Limitations on aggregate amount of credit.--
24 The total amount of credits awarded pursuant to this article
25 shall not exceed five million dollars ($5,000,000) in any fiscal
26 year.
27 Section 2208. Amount of credit; carryover and carryback of
28 credit; refund of credit.--(a) The amount of the credit
29 provided by this article that a taxpayer uses during a taxable
30 year may not exceed fifty per cent of the qualified tax
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1 liability for the taxable year. If the credit provided by this
2 article exceeds fifty per cent of the qualified tax liability
3 for the taxable year for which the credit is first claimed, the
4 excess may be carried over to succeeding taxable years and used
5 as a credit against the qualified tax liability otherwise due
6 and payable by the taxpayer during those taxable years; provided
7 that the total amount of credit used in any tax year may not
8 exceed fifty per cent of the qualified tax liability for that
9 taxable year. Each time that a credit is carried over to the
10 succeeding taxable year, it is to be reduced by the amount which
11 was used as a credit during the immediately preceding taxable
12 year. The credit provided by this article may be carried forward
13 and applied to succeeding taxable years for not more than three
14 years following the unused credit year.
15 (b) A credit earned by a taxpayer in a particular taxable
16 year shall be applied against the taxpayer's tax liability for
17 that taxable year before any credit carryover is applied against
18 that liability under subsection (a).
19 (c) A taxpayer is not entitled to any carryback or refund of
20 any unused credit.
21 Section 2209. Time limitations.--Notwithstanding the other
22 provisions of this article, a taxpayer shall not be entitled to
23 a credit for Pennsylvania qualified apprenticeship expense
24 incurred in tax years beginning after December 31, 2002.
25 Section 2210. Reports required.--Within four months after
26 the close of any fiscal year during which tax credits granted
27 pursuant to this article were awarded. The Secretary of Labor
28 and Industry shall furnish to the Labor and Industry Committee
29 of the Senate and the Finance Committee of the House of
30 Representatives a report detailing the credits awarded pursuant
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1 to this act. The report shall include the name of any employer
2 awarded the credit, their primary business location, the amount
3 of credit awarded, the number of apprenticeships for which the
4 credit was awarded and the type of apprenticeship. The report
5 shall also provide the aggregate number of employers awarded
6 credit during the most recent fiscal year and the aggregate
7 amount of credits awarded. The report shall also include any
8 recommendations for changes in the calculation or administration
9 of the credit.
10 Section 2. This act shall apply to tax years beginning on or
11 after January 1, 1998.
12 Section 3. This act shall take effect immediately.
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