PRINTER'S NO. 1737
No. 1427 Session of 2005
INTRODUCED BY DENLINGER, ARMSTRONG, BALDWIN, BARRAR, BIANCUCCI,
BOYD, CALTAGIRONE, CAPPELLI, CLYMER, CRAHALLA, CREIGHTON,
DALLY, GINGRICH, GOOD, HARPER, HERSHEY, HUTCHINSON, LEH,
MAHER, NICKOL, RAYMOND, REICHLEY, ROSS, RUBLEY, SAYLOR,
SCAVELLO, SCHRODER, STEIL, THOMAS, TIGUE, TURZAI, WILT,
YOUNGBLOOD AND GERGELY, APRIL 28, 2005
REFERRED TO COMMITTEE ON FINANCE, APRIL 28, 2005
AN ACT
1 Amending the act of December 31, 1965 (P.L.1257, No.511),
2 entitled "An act empowering cities of the second class,
3 cities of the second class A, cities of the third class,
4 boroughs, towns, townships of the first class, townships of
5 the second class, school districts of the second class,
6 school districts of the third class and school districts of
7 the fourth class including independent school districts, to
8 levy, assess, collect or to provide for the levying,
9 assessment and collection of certain taxes subject to maximum
10 limitations for general revenue purposes; authorizing the
11 establishment of bureaus and the appointment and compensation
12 of officers, agencies and employes to assess and collect such
13 taxes; providing for joint collection of certain taxes,
14 prescribing certain definitions and other provisions for
15 taxes levied and assessed upon earned income, providing for
16 annual audits and for collection of delinquent taxes, and
17 permitting and requiring penalties to be imposed and
18 enforced, including penalties for disclosure of confidential
19 information, providing an appeal from the ordinance or
20 resolution levying such taxes to the court of quarter
21 sessions and to the Supreme Court and Superior Court,"
22 further providing for collection of taxes, for audits of
23 earned income taxes, for earned income taxes, for suits for
24 tax collection, for penalties and for delinquent tax
25 collection costs.
26 The General Assembly of the Commonwealth of Pennsylvania
27 hereby enacts as follows:
1 Section 1. Section 10 of the act of December 31, 1965
2 (P.L.1257, No.511), known as The Local Tax Enabling Act, amended
3 November 30, 2004 (P.L.1520, No.192) and December 1, 2004
4 (P.L.1729, No.222), is amended to read:
5 Section 10. Collection of Taxes.--(a) Administrative
6 Personnel; Joint Agreements.--Except as provided in subsections
7 (b) and (c), [any such] a political subdivision is hereby
8 authorized to provide by ordinance or resolution for the
9 creation of bureaus or the designation [of such bureaus or the],
10 appointment and compensation of [such] officers, [clerks,
11 collectors,] public employes, private agencies or other [person
12 and other assistants] persons, and their employes[, either under
13 existing departments, or otherwise] as [may be deemed]
14 necessary, for the assessment and collection of taxes imposed
15 under authority of this act. Each ordinance or resolution under
16 this section authorizing a person, public employe or private
17 agency to act [in the capacity and with the authority of] as a
18 tax collector for the political subdivision shall continue in
19 force without annual reauthorization unless otherwise repealed
20 or revoked by the political subdivision. A political subdivision
21 must enter into a written contract with an officer, private
22 agency or other person, appointed or designated to collect the
23 earned income tax.
24 Except as provided in subsections (b) and (c), any political
25 subdivisions imposing taxes under authority of this act are
26 authorized to make joint agreements for the collection of such
27 taxes or any of them. The same person or agency may be employed
28 by two or more political subdivisions to collect any taxes
29 imposed by them under authority of this act.
30 (b) Single Collector for Earned Income Taxes [When Certain
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1 School Districts Impose Such Taxes] Imposed by a School
2 District.--Except as provided in subsection (c), whenever a
3 school district of the second, third or fourth class shall be
4 established pursuant to section 296[,] of the act of March 10,
5 1949 (P.L.30), known as the "Public School Code of 1949," added
6 August 8, 1963 (P.L. 564), and [such school district shall levy,
7 assess and collect or provide for the levying, assessment and
8 collection of] the school district levies a tax upon earned
9 income, such school district and all cities, boroughs, towns and
10 townships within its geographical limits which levy, assess and
11 collect [or provide for the levying, assessment and collection
12 of] a tax upon earned income[, may on January 1, 1967, or] shall
13 as soon [thereafter] as the school district [shall provide for
14 the levying, assessment and collection of taxes upon earned
15 income, select one person or agency] has levied, assessed or
16 collected an earned income tax, designate or appoint an officer,
17 public employe or private agency to collect the taxes upon
18 earned income imposed by all [such] political subdivisions
19 within the geographic limits of the school district. In
20 [selecting such person] order to designate or appoint the
21 officer, public employe or private agency, each political
22 subdivision shall share in the [selection] designation or
23 appointment upon a basis agreed upon by each political
24 subdivision, [or in] including the school district. In the
25 absence of any agreement on the basis of voting, voting shall be
26 conducted according to the proportion that the population of
27 each bears to the entire population of the combined collection
28 district, according to the latest official Federal census, and
29 the majority of such votes cast shall determine the [person or
30 agency selected] bureau, officer, public employe or private
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1 agency designated to collect the [taxes] earned income tax. The
2 provisions of this paragraph shall not prohibit school districts
3 and other political subdivisions which levy, assess and collect
4 [or provide for the levying, assessment and collection of] taxes
5 upon earned income, under authority of this act, from
6 [selecting] designating or appointing the same [person] officer,
7 public employe or private agency to collect such tax upon earned
8 income in an area larger than the geographical limits of a
9 school district established pursuant to section 296 of the
10 "Public School Code of 1949."
11 (c) Single Tax Collector in Certain Home Rule
12 Municipality.--In a municipality having a population under the
13 2000 Federal decennial census of at least forty thousand and
14 less than ninety thousand located in a second class county which
15 municipality has adopted a home rule charter under 53 Pa.C.S.
16 Pt. III Subpt. E (relating to home rule and optional plan
17 government), the person or persons appointed by the board of
18 school directors for the school district in which the
19 municipality is located as collector or collectors of taxes
20 levied by the school district under this act shall also serve as
21 the collector or collectors of taxes levied by the municipality
22 under this act.
23 (d) Records.--All tax collection records shall be a property
24 of the political subdivision in which the taxes were collected.
25 The political subdivision or its tax collector shall retain all
26 records for at least seven years. Unclaimed tax records shall be
27 retained for fifteen years.
28 Section 2. Section 11 of the act is amended to read:
29 Section 11. Audits of Earned Income Taxes.--Except in cities
30 of the second class, [the governing body of] each political
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1 subdivision which levies, assesses and collects [or provides for
2 the levying, assessment and collection of] a tax upon earned
3 income, shall provide for not less than one examination each
4 year of the books, accounts, financial statements, compliance
5 reports and records of the income tax collector, by a certified
6 public accountant, a firm of certified public accountants, a
7 competent independent public accountant, or a firm of
8 independent public accountants appointed by the [governing body]
9 political subdivision. Whenever one person or agency is selected
10 to collect earned income taxes for more than one political
11 subdivision, the books, accounts and records of such person or
12 agency shall be examined as provided above in the case of a tax
13 collector for each political subdivision, except that the
14 accountant shall be selected in the manner provided for
15 selection of one person or agency to collect earned income taxes
16 for the school district established under section 296 of the
17 "Public School Code of 1949," and the cities, boroughs, towns
18 and townships within the geographical limits of such school
19 district. The examination shall be conducted according to
20 generally accepted governmental auditing standards and shall
21 include a financial statement, a report on the income tax
22 officer's compliance with this act, a list of any findings of
23 noncompliance with this act and a copy of a management letter if
24 one is issued by the auditor. The reports of the audit shall be
25 sent to the governing body [or bodies] of the political
26 subdivision [or political subdivisions] employing the
27 accountant. If there are findings of noncompliance, a copy of
28 the report shall be filed with the Office of Attorney General
29 and the Department of Community and Economic Development. No
30 further or additional audit shall be performed by elected or
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1 appointed auditors.
2 Section 3. Division I, Subdivision A of Division III and
3 Division V of section 13 of the act, amended or added July 15,
4 1976 (P.L.1047, No.210), October 4, 1978 (P.L.930, No.177),
5 December 9, 2002 (P.L.1364, No.166), April 5, 2004 (P.L.208,
6 No.24), and November 30, 2004 (P.L.1520, No.192), are amended
7 and the section is amended by adding a division to read:
8 Section 13. Earned Income Taxes.--On and after the effective
9 date of this act the remaining provisions of this section shall
10 be included in or construed to be a part of each tax levied and
11 assessed upon earned income by [any] a political subdivision
12 [levying and assessing such tax pursuant to this act]. The
13 definitions contained in this section shall be exclusive for any
14 tax upon earned income and net profits levied and assessed
15 pursuant to this act, and shall not be altered or changed by
16 [any] a political subdivision [levying and assessing such tax].
17 I. Definitions
18 "Association." A partnership, limited partnership, or any
19 other unincorporated group of two or more persons.
20 "Business." An enterprise, activity, profession or any other
21 undertaking of an unincorporated nature conducted for profit or
22 ordinarily conducted for profit whether by a person,
23 partnership, association, or any other entity.
24 "Corporation." A corporation [or], joint stock association or
25 limited liability company organized under the laws of the United
26 States, the Commonwealth of Pennsylvania, or any other state,
27 territory, foreign country or dependency.
28 "Current year." The calendar year for which the tax is
29 levied.
30 "Department." The Department of Community and Economic
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1 Development of the Commonwealth.
2 "Domicile." The place where one lives and has his permanent
3 home and to which he has the intention of returning whenever he
4 is absent. Actual residence is not necessarily domicile, for
5 domicile is the fixed place of abode which, in the intention of
6 the taxpayer, is permanent rather than transitory. Domicile is
7 the voluntarily fixed place of habitation of a person, not for a
8 mere special or limited purpose, but with the present intention
9 of making a permanent home, until some event occurs to induce
10 him to adopt some other permanent home. In the case of
11 businesses, or associations, the domicile is that place
12 considered as the center of business affairs and the place where
13 its functions are discharged.
14 "Earned income." Compensation as determined under section 303
15 of the act of March 4, 1971 (P.L.6, No.2), known as the "Tax
16 Reform Code of 1971," and regulations in 61 Pa. Code Pt. I
17 Subpt. B Art. V (relating to personal income tax), not
18 including, however, wages or compensation paid to individuals on
19 active military service. Employe business expenses are allowable
20 deductions as determined under Article III of the "Tax Reform
21 Code of 1971." The amount of any housing allowance provided to a
22 member of the clergy shall not be taxable as earned income.
23 "Income tax officer or officer." [Person] A bureau, person,
24 public employe or private agency designated by [governing body]
25 a political subdivision to collect and administer the tax on
26 earned income and net profits authorized under this act.
27 "Employer." A person, partnership, association, business,
28 corporation, limited liability company, institution,
29 governmental body or unit or agency, or any other entity
30 employing one or more persons for a salary, wage, commission or
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1 other compensation.
2 "Net profits." The net income from the operation of a
3 business, profession, or other activity, except corporations,
4 determined under section 303 of the act of March 4, 1971 (P.L.6,
5 No.2), known as the "Tax Reform Code of 1971," and regulations
6 in 61 Pa. Code Pt. I Subpt. B Art. V (relating to personal
7 income tax). The term does not include income which is not paid
8 for services provided and which is in the nature of earnings
9 from an investment. For taxpayers engaged in the business,
10 profession or activity of farming, the term shall not include:
11 (1) any interest earnings generated from any monetary
12 accounts or investment instruments of the farming business;
13 (2) any gain on the sale of farm machinery;
14 (3) any gain on the sale of livestock held twelve months or
15 more for draft, breeding or dairy purposes; and
16 (4) any gain on the sale of other capital assets of the
17 farm.
18 "Nonresident." A person, partnership, association, business,
19 corporation, limited liability company or other entity domiciled
20 outside the taxing district.
21 "Person or individual." A natural person.
22 "Political subdivision." A city of the second class, city of
23 the second class A, city of the third class, borough, town,
24 township of the first class, township of the second class,
25 school district of the second class, school district of the
26 third class or school district of the fourth class.
27 "Preceding year." The calendar year before the current year.
28 "Private agency." Any person, partnership, association,
29 business corporation or limited liability company, engaged in
30 the business of collecting or administering a tax under this
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1 act.
2 "Resident." A person, partnership, association, business,
3 corporation, limited liability company or other entity domiciled
4 in the taxing district.
5 "Succeeding year." The calendar year following the current
6 year.
7 "Taxpayer." A person, partnership, association, business,
8 corporation or any other entity, required hereunder to file a
9 return of earned income or net profits, or to pay a tax thereon.
10 "Tax records." Tax returns, supporting schedules,
11 correspondence with auditors or taxpayers, account books and
12 other documents obtained or created by the officer to implement
13 the collection of a tax under this act. The officer may submit
14 computerized summaries of tax returns and other documents in
15 lieu of the actual documents.
16 * * *
17 III. Declaration and Payment of Tax
18 A. Net Profits.
19 (1) Every taxpayer making net profits shall, as the
20 [governing body] political subdivision elects, (i) pay to the
21 officer an annual payment of tax due on or before April 15[,] of
22 the succeeding year for the period beginning January 1[,] and
23 ending December 31[,] of the current year, or (ii) on or before
24 April 15[,] of the current year, make and file with the officer
25 on a form prescribed [or approved by the officer] by the
26 department, a declaration of his estimated net profits during
27 the period beginning January 1[,] and ending December 31[,] of
28 the current year, and pay to the officer in four equal quarterly
29 installments the tax due thereon as follows: the first
30 installment at the time of filing the declaration, and the other
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1 installments on or before June 15[,] of the current year,
2 September 15[,] of the current year, and January 15[,] of the
3 succeeding year, respectively.
4 (2) Where the [governing body] political subdivision elects
5 to require the filing of a declaration and quarterly payments,
6 any taxpayer who first anticipates any net profit after April
7 15[,] of the current year, shall make and file the declaration
8 hereinabove required on or before June 15[,] of the current
9 year, September 15[,] of the current year, or December 31[,] of
10 the current year, whichever of these dates next follows the date
11 on which the taxpayer first anticipates such net profit, and pay
12 to the officer in equal installments the tax due thereon on or
13 before the quarterly payment dates which remain after the filing
14 of the declaration.
15 (3) Where the [governing body] political subdivision
16 requires a declaration of estimated net profits and quarterly
17 payments of tax due on such profits, every taxpayer shall, on or
18 before April 15[,] of the succeeding year, make and file with
19 the officer on a form prescribed or approved by the officer a
20 final return showing the amount of net profits earned during the
21 period beginning January 1[,] of the current year, and ending
22 December 31[,] of the current year, the total amount of tax due
23 thereon and the total amount of tax paid thereon. At the time of
24 filing the final return, the taxpayer shall pay to the officer
25 the balance of tax due or shall make demand for refund or credit
26 in the case of overpayment.
27 Any taxpayer may, in lieu of paying the fourth quarterly
28 installment of his estimated tax, elect to make and file with
29 the officer on or before January 31, of the succeeding year, the
30 final return as hereinabove required.
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1 (4) [The officer may be authorized to provide by regulation
2 for the making and filing of] The department may adopt a
3 regulation authorizing the officer to make and file adjusted
4 declarations of estimated net profits, and for the payments of
5 the estimated tax in cases where a taxpayer who has filed [the
6 declaration hereinabove required] under paragraphs (1), (2) or
7 (3) anticipates additional net profits not previously declared
8 or finds that he has overestimated his anticipated net profits.
9 (5) Every taxpayer who discontinues business prior to
10 December 31[,] of the current year[,] shall, within thirty days
11 after the discontinuance of business, file his final return as
12 [hereinabove] required under this division and pay the tax due.
13 * * *
14 V. Powers and Duties of Officer
15 (a) It shall be the duty of the income tax officer to
16 collect and receive [the] resident and nonresident taxes, fines
17 and penalties imposed by the ordinance or resolution. It shall
18 also be [his duty] the duty of the officer to keep a record
19 showing the amount received [by him] from each person or
20 business paying the tax and the date of such receipt. The
21 information shall be included in the report submitted under
22 subsection (i).
23 (b) Each officer, before entering upon his official duties
24 shall give and acknowledge a bond to the political subdivision
25 [or political subdivisions] appointing him. If such political
26 subdivision [or political subdivisions] shall by resolution
27 designate any bond previously given by the officer as adequate,
28 such bond shall be sufficient to satisfy the requirements of the
29 subsection. The bond shall be renewed annually.
30 Each such bond shall be joint and several, with one or more
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1 corporate sureties which shall be surety companies authorized to
2 do business in this Commonwealth and duly licensed by the
3 Insurance Commissioner of this Commonwealth.
4 Each bond shall be conditioned upon the faithful discharge by
5 the officer, his clerks, assistants and appointees of all trusts
6 confided in him by virtue of his office, upon the faithful
7 execution of all duties required of him by virtue of his office,
8 upon the just and faithful accounting or payment over, according
9 to law, of all moneys and all balances thereof paid to, received
10 or held by him by virtue of his office and upon the delivery to
11 his successor [or successors] in office of all books, papers,
12 documents or other official things held in right of his office.
13 Each such bond shall be taken in the name of the appointing
14 authority [or authorities], and shall be for the use of the
15 political subdivision [or political subdivisions] appointing the
16 officer, and for the use of such other person [or persons] for
17 whom money shall be collected or received, or as his or her
18 interest shall otherwise appear, in case of a breach of any of
19 the conditions thereof by the acts or neglect of the principal
20 on the bond.
21 The political subdivision [or political subdivisions]
22 appointing the officer, or any person may sue upon the [said]
23 bond in its or his own name for its or his own use.
24 Each such bond shall contain the name [or names] of the
25 surety company [or companies] bound thereon. The political
26 subdivision [or political subdivisions] appointing the officer
27 shall fix the amount of the bond at an amount [equal to the
28 maximum amount of taxes which may be in the possession]
29 sufficient to secure the financial responsibility of the officer
30 [at any given time.] in accordance with guidelines relating to
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1 the amount of the bond adopted by the department. Copies of the
2 bond shall be filed with the political subdivision.
3 The political subdivision [or political subdivisions]
4 appointing the officer may, at any time, upon cause shown and
5 due notice to the officer, and his surety [or sureties], require
6 or allow the substitution or the addition of a surety company
7 acceptable to such political subdivision [or political
8 subdivisions] for the purpose of making the bond sufficient in
9 amount, without releasing the surety [or sureties] first
10 approved from any accrued liability or previous action on such
11 bond.
12 The political subdivision [or political subdivisions]
13 appointing the officer shall designate the custodian of the bond
14 required to be given by the officer. A copy of the bond shall be
15 made available upon request to a political subdivision, or the
16 officer collector appointed by the political subdivision,
17 seeking payment or distribution of a tax authorized by this act.
18 (b.1) The department shall promulgate regulations relating
19 to the administration, collection, enforcement, removal of
20 officers from office and appeal process under this act. The
21 regulations shall include required forms, including a
22 certificate of residency form, returns and declarations.
23 (c) The officer charged with the administration and
24 enforcement of the [provisions of the] ordinance or resolution
25 [is hereby empowered to prescribe, adopt, promulgate and
26 enforce, rules and regulations relating to any matter pertaining
27 to the administration and enforcement of the ordinance or
28 resolution, including provisions for the re-examination and
29 correction of declarations and returns, and of payments alleged
30 or found to be incorrect, or as to which an overpayment is
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1 claimed or found to have occurred, and to make refunds in case
2 of overpayment, for any period of time not to exceed six years
3 subsequent to the date of payment of the sum involved, and to
4 prescribe forms necessary for the administration of the
5 ordinance or resolution. No rule or regulation of any kind shall
6 be enforceable unless it has been approved by resolution by the
7 governing body. A copy of such rules and regulations currently
8 in force shall be available for public inspection.] shall comply
9 with all regulations adopted by the department under this act.
10 The officer may use rules and regulations previously adopted by
11 the officer or the political subdivision in accordance with this
12 act until the adoption of regulations by the department.
13 (c.1) An officer shall make refunds for overpayment of taxes
14 under this act for a period not to exceed six years subsequent
15 to the date of payment.
16 (d) The officer shall refund, on petition of, and proof by
17 the taxpayer, earned income tax paid on the taxpayer's ordinary
18 and necessary business expenses, to the extent that such
19 expenses are not paid by the taxpayer's employer.
20 (e) The officer and agents designated by him are hereby
21 authorized to examine the books, papers, and records of any
22 employer [or of any taxpayer or of any], taxpayer or other
23 person whom the officer reasonably believes to be an employer or
24 taxpayer, in order to verify the accuracy of any declaration or
25 return, or if no declaration or return was filed, to ascertain
26 the tax due. Every employer [and every taxpayer and every
27 person], taxpayer or other person whom the officer reasonably
28 believes to be an employer or taxpayer, is hereby directed and
29 required to give to the officer, or to any agent designated by
30 [him] the officer, the means, facilities and opportunity for
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1 such examination and investigations[, as are hereby] authorized
2 under this act.
3 (f) Any information gained by the officer, his agents, or by
4 any other official or agent of the [taxing district] political
5 subdivision, as a result of any declarations, returns,
6 investigations, hearings or verifications required or authorized
7 by the ordinance or resolution, shall be confidential, except
8 for official purposes and except in accordance with a proper
9 judicial order, or as otherwise provided by law.
10 (g) The officer is authorized to establish different filing,
11 reporting and payment dates for taxpayers whose fiscal years do
12 not coincide with the calendar year.
13 (h) The officer shall distribute earned income taxes to the
14 appropriate political subdivisions within sixty days of the
15 deadline for payment by an employer as set forth in Division
16 IV(b). [The political subdivisions] A political subdivision
17 shall not be required to request the officer to distribute the
18 funds collected but shall at least annually reconcile their
19 receipts with the records of the officer and return to or credit
20 the officer with any overpayment. A political subdivision shall
21 not be required to pay a fee or commission to the other
22 political subdivision or its tax officer for tax revenue
23 distributed under this subsection. If the officer, within one
24 year after receiving a tax payment, cannot identify the taxing
25 jurisdiction entitled to a tax payment, he shall make payment to
26 the municipality in which the tax was collected. If earned
27 income taxes are not distributed to the appropriate political
28 subdivision within one year of receipt, the political
29 subdivision may make a written demand on a tax officer or
30 political subdivision for tax revenues collected and
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1 attributable to residents of the political subdivision making
2 the demand. If the taxes attributable to the residents of the
3 political subdivision making the demand are not paid within
4 thirty days from the date of the demand, the political
5 subdivision, person, public employe or private agency designated
6 by the political subdivision may enter into an arbitration
7 agreement with the officer under 42 Pa.C.S. Ch. 73 Subch. A
8 (relating to statutory arbitration) or bring an action in [an
9 appropriate] the court of common pleas where the officer is a
10 resident or where the political subdivision is located in the
11 name of the taxing district for the recovery of taxes not
12 distributed in accordance with this subsection. The action must
13 be brought within seven years of the collection of the taxes.
14 (i) The officer shall, on or before the tenth day of each
15 month, provide a written report, on a form adopted by the
16 department, to the appropriate official of each political
17 subdivision for which taxes were collected during the previous
18 month and to the department. The report shall include the names
19 of taxpayers and employers, the amount collected from each
20 taxpayer or employer, penalties and interest on collections,
21 costs of collection, amounts owed to other political
22 subdivisions, refunds, recoveries and overpayments.
23 (j) An income tax officer shall file an annual report with
24 the political subdivision and the department. The report shall
25 include all tax collection information for the most recently
26 completed tax year as required by the department. The report
27 shall be filed by June 15 of the year following the close of the
28 reporting year.
29 * * *
30 X. Fines and Penalties Against Income
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1 Tax Officers
2 (a) A political subdivision which brings an action under
3 Division V(h) may seek equitable relief, including an accounting
4 of all undistributed taxes and monetary damages in the form of
5 recovery of the taxes not previously distributed plus interest
6 calculated from the date that the taxes should have been
7 distributed. In addition, the court may impose a civil penalty
8 not to exceed two thousand five hundred dollars ($2,500) for
9 each tax quarter for which taxes were not distributed in
10 accordance with Division V(h), plus reasonable costs and
11 attorney fees. If an officer fails to distribute earned income
12 taxes to the appropriate political subdivision as required under
13 Division V(h), for four consecutive tax quarters, the court may
14 impose a civil penalty not to exceed five thousand dollars
15 ($5,000).
16 (b) If an officer fails to submit the report required under
17 Division V(i) or (j), a political subdivision entitled to
18 receive the report may bring an action in the court of common
19 pleas of that political subdivision and the court may impose a
20 penalty of twenty dollars ($20) a day for each day that the
21 report is overdue, not to exceed five hundred dollars ($500). If
22 a report submitted under Division V(j) includes any findings of
23 noncompliance, the officer is responsible for a civil penalty of
24 not less than five hundred dollars ($500) but not more than two
25 thousand five hundred dollars ($2,500).
26 (c) An officer who violates any other provision of this act
27 shall be subject to a civil penalty of up to two thousand five
28 hundred dollars ($2,500) for each violation.
29 (d) An action against an officer for a violation of this act
30 may be brought by a political subdivision in which the officer
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1 collects taxes, a political subdivision owed taxes by the
2 officer, by a surety or by the department.
3 (e) A political subdivision shall remove or rescind the
4 appointment of an income tax official who has been penalized
5 under subsection (c) more than three times.
6 Section 4. Section 21 of the act, amended November 30, 2004
7 (P.L.1520, No.192), is amended to read:
8 Section 21. Collection of Taxes by Suit.--Each [taxing
9 district or person,] political subdivision, bureau, officer,
10 public employe [or], private agency or other person designated
11 by the taxing district shall have power to collect unpaid taxes
12 from the persons owing such taxes by suit in assumpsit or other
13 appropriate remedy. Upon each such judgment, execution may be
14 issued without any stay or benefit of any exemption law. The
15 right of each [such taxing district] political subdivision to
16 collect unpaid taxes under [the provisions of] this section
17 shall not be affected by the fact that such taxes have been
18 entered as liens in the office of the prothonotary, or the fact
19 that the property against which they were levied has been
20 returned to the county commissioners for taxes for prior years.
21 Section 5. Section 22 of the act is amended to read:
22 Section 22. Penalties.--Except as otherwise provided in the
23 case of any tax levied and assessed upon earned income, any such
24 political subdivision shall have power to prescribe and enforce
25 reasonable penalties for the nonpayment, within the time fixed
26 for their payment, of taxes imposed under authority of this act
27 and for the violations of the provisions of ordinances or
28 resolutions passed under authority of this act.
29 If for any reason any tax levied and assessed upon earned
30 income by any such political subdivision is not paid when due,
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1 interest at the rate of six percent per annum on the amount of
2 said tax, and an additional penalty of one-half of one percent
3 of the amount of the unpaid tax or, if more than 25% of the
4 amount reported is underreported, an additional penalty of 25%
5 of the amount of the unreported tax for each month or fraction
6 thereof during which the tax remains unpaid, shall be added and
7 collected. When suit is brought for the recovery of any such
8 tax, the person liable therefor shall, in addition, be liable
9 for the costs of collection and the interest and penalties
10 herein imposed.
11 Section 6. Section 22.1 of the act, added November 30, 2004
12 (P.L.1520, NO.192), is amended to read:
13 Section 22.1. Costs of Collection of Delinquent Per Capita,
14 Occupation, Occupational Privilege and Earned Income Taxes.--(a)
15 A person, public employe or private agency designated by [a
16 governing body of] a political subdivision to collect and
17 administer a [per capita, occupation, occupational privilege or
18 earned income] tax under this act may impose and collect the
19 reasonable costs incurred to provide notices of delinquency or
20 to implement [similar] other procedures utilized to collect
21 delinquent taxes from a taxpayer, as approved by [the governing
22 body of] the political subdivision. Reasonable costs collected
23 may be retained by the officer, person, public employe or
24 private agency designated to collect the tax, as agreed to by
25 [the governing body of] the political subdivision. An itemized
26 accounting of all costs collected shall be remitted to the
27 political subdivision on an annual basis.
28 (b) Costs related to the collection of unpaid per capita,
29 occupation or occupational privilege taxes may only be assessed,
30 levied and collected for five years from the last day of the
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1 calendar year in which the tax was due.
2 (c) A delinquent taxpayer may not bring an action for
3 reimbursement, refund or elimination of reasonable costs of
4 collection assessed or imposed prior to the effective date of
5 this section. Additional costs may not be assessed on delinquent
6 taxes collected prior to the effective date of this section.
7 Section 7. This act shall take effect in 60 days.
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