PRIOR PRINTER'S NO. 1853 PRINTER'S NO. 1936
No. 1316 Session of 2008
INTRODUCED BY BAKER, WAUGH, RAFFERTY, PUNT, O'PAKE, MADIGAN,
KASUNIC, FONTANA, ERICKSON, BOSCOLA, ORIE, KITCHEN,
TOMLINSON, EICHELBERGER, WONDERLING, REGOLA, LOGAN, CORMAN,
ARMSTRONG, BROWNE, BRUBAKER, ROBBINS, PIPPY, EARLL, COSTA,
WOZNIAK, C. WILLIAMS, FOLMER, M. WHITE, D. WHITE, RHOADES,
McILHINNEY, DINNIMAN, STOUT, MUSTO, WASHINGTON AND FERLO,
MARCH 20, 2008
SENATOR BROWNE, FINANCE, AS AMENDED, APRIL 9, 2008
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 tax credit for employers of
11 volunteer firefighters and emergency medical services
12 workers.
13 The General Assembly of the Commonwealth of Pennsylvania
14 hereby enacts as follows:
15 Section 1. The act of March 4, 1971 (P.L.6, No.2), known as
16 the Tax Reform Code of 1971, is amended by adding an article to
17 read:
18 ARTICLE XVIII-C
19 VOLUNTEER FIREFIGHTER AND EMERGENCY MEDICAL
20 SERVICES WORKER EMPLOYER TAX CREDIT
1 Section 1801-C. Definitions.
2 The following words and phrases when used in this article
3 shall have the meanings given to them in this section unless the
4 context clearly indicates otherwise:
5 "Active volunteer." A volunteer firefighter or volunteer
6 emergency medical services worker.
7 "Commissioner." The State Fire Commissioner appointed
8 pursuant to section 3 of the act of November 13, 1995 (P.L.604,
9 No.61), known as the State Fire Commissioner Act.
10 "Department." The Department of Revenue of the Commonwealth.
11 "Director." The director of the Emergency Medical Services
12 Office in the Department of Health.
13 "PASS-THROUGH ENTITY." A PARTNERSHIP AS DEFINED IN SECTION <--
14 301(N.0) OR A PENNSYLVANIA S CORPORATION AS DEFINED IN SECTION
15 301(N.1).
16 "QUALIFIED EMPLOYEE." AN ACTIVE VOLUNTEER FIREFIGHTER OR
17 ACTIVE VOLUNTEER EMERGENCY MEDICAL SERVICE WORKER EMPLOYED BY A
18 TAXPAYER UNDER THIS ARTICLE.
19 "QUALIFIED TAX LIABILITY." THE LIABILITY FOR TAXES IMPOSED
20 UNDER ARTICLE III, IV OR VI. THE TERM SHALL NOT INCLUDE ANY TAX
21 WITHHELD BY AN EMPLOYER FROM AN EMPLOYEE UNDER ARTICLE III.
22 "Secretary." The Secretary of Revenue of the Commonwealth.
23 "Tax credit." The tax credit available to employers of
24 volunteer firefighters or volunteer emergency medical services
25 workers under this article.
26 "Taxpayer." An individual subject to payment of taxes under
27 Article III, IV or VI.
28 "Volunteer emergency medical services worker." A person
29 certified as an active volunteer emergency medical services
30 provider by the director of the Emergency Medical Services
20080S1316B1936 - 2 -
1 Office of the Department of Health.
2 "Volunteer fire company." A nonprofit chartered corporation,
3 association or organization located in this Commonwealth that
4 provides fire protection services and may offer other volunteer
5 services within this Commonwealth. Voluntary emergency services
6 provided by a volunteer fire company may include voluntary
7 ambulance and voluntary rescue services.
8 "Volunteer firefighter." The term shall have the same
9 meaning given to it under section 2 of the act of June 11, 1968
10 (P.L.149, No.84), known as the Volunteer Firefighters' Relief
11 Association Act. The term includes fire police.
12 Section 1802-C. Credit for employment. <--
13 (a) Credit available.--A taxpayer is eligible for a tax
14 credit as provided in subsection (b) against the tax imposed
15 under Article III, IV or VI, but shall not include any tax
16 withheld by an employer from an employee under Article III if:
17 (1) the taxpayer hires an employee who is an active
18 volunteer; or
19 (2) the taxpayer has an employee who becomes an active
20 volunteer during the calendar year.
21 SECTION 1802-C. APPLICATION PROCESS. <--
22 (A) APPLICATION TO DEPARTMENT.--A TAXPAYER MAY APPLY TO THE
23 DEPARTMENT FOR A TAX CREDIT BY FILING AN APPLICATION ON THE FORM
24 REQUIRED BY THE DEPARTMENT. THE APPLICATION SHALL CONTAIN THE
25 FOLLOWING INFORMATION:
26 (1) THE NAME AND TAX IDENTIFICATION NUMBER OF ALL
27 QUALIFIED EMPLOYEES.
28 (2) THE NAME AND LOCATION OF THE VOLUNTEER FIRE COMPANY
29 OR VOLUNTEER EMERGENCY MEDICAL SERVICES/AMBULANCE DEPARTMENT
30 WHERE THE QUALIFIED EMPLOYEE IS AN ACTIVE MEMBER.
20080S1316B1936 - 3 -
1 (3) ANY OTHER INFORMATION DEEMED APPROPRIATE BY THE
2 DEPARTMENT.
3 (B) REVIEW AND APPROVAL.--THE DEPARTMENT SHALL REVIEW AND
4 APPROVE OR DISAPPROVE THE APPLICATIONS IN THE ORDER IN WHICH
5 THEY ARE RECEIVED. UPON DETERMINING THAT THE TAXPAYER HAS
6 EMPLOYED A QUALIFIED EMPLOYEE OR EMPLOYEES, THE DEPARTMENT MAY
7 APPROVE THE TAXPAYER FOR A TAX CREDIT.
8 SECTION 1803-C. CREDIT FOR EMPLOYMENT.
9 (A) CREDIT FOR EMPLOYMENT OF VOLUNTEER FIREFIGHTERS AND
10 EMERGENCY MEDICAL SERVICES PERSONNEL.--A TAXPAYER SHALL BE
11 ELIGIBLE FOR A TAX CREDIT AS PROVIDED IN SUBSECTION (B) AGAINST
12 THE TAX IMPOSED UNDER ARTICLE III, IV OR VI IF:
13 (1) THE TAXPAYER EMPLOYS WITHIN THIS COMMONWEALTH A
14 QUALIFIED EMPLOYEE WHO IS AN ACTIVE VOLUNTEER.
15 (2) THE TAXPAYER ADOPTS AND IMPLEMENTS A POLICY THAT
16 PERMITS A QUALIFIED EMPLOYEE TO BE ABSENT FROM WORK, WITHOUT
17 PENALTY, FOR THE PURPOSE OF RESPONDING TO A DUTY CALL, FIRE
18 PROTECTION, EMERGENCY CALL OR ANNUAL EMERGENCY SERVICES
19 TRAINING.
20 (3) AT THE REQUEST OF THE TAXPAYER, ANY QUALIFIED
21 EMPLOYEE LOSING TIME DURING NORMAL WORK TIME HOURS AS
22 PROVIDED FOR IN PARAGRAPH (2) SHALL SUPPLY HIS EMPLOYER WITH
23 A STATEMENT FROM THE CHIEF OF THE VOLUNTEER FIRE DEPARTMENT
24 OR THE SUPERVISOR OR OTHER APPROPRIATE PERSON IN CHARGE OF
25 THE VOLUNTEER RESPONSE SERVICE STATING THAT THE EMPLOYEE
26 RESPONDED TO AN EMERGENCY CALL AND THE DATE AND TIME OF THE
27 CALL.
28 (b) Maximum credit.--A taxpayer may claim a tax credit for
29 each full-time employee who qualifies under subsection (a) as
30 follows:
20080S1316B1936 - 4 -
1 (1) The taxpayer may claim a full $1,000 tax credit for
2 all employees who qualify under subsection (a). This credit
3 may be claimed only once with respect to each qualified
4 employee and may not be claimed if the qualified employee has
5 been claimed by a previous employer DURING THE SAME TAXABLE <--
6 YEAR.
7 (2) If the employee is not qualified for the entire tax
8 year, the amount of tax credit shall be prorated and the
9 credit amount shall equal $1,000, divided by 12, multiplied
10 by the number of months in the tax year the employee was
11 employed by the taxpayer. The credit shall be rounded to the
12 nearest $5. If the taxpayer is an active volunteer during any
13 part of a month, the taxpayer shall be considered an active
14 volunteer for the entire month. If the taxpayer is a
15 volunteer firefighter and a volunteer emergency medical
16 services worker during the same month, a credit may be
17 claimed for only one active volunteer position for that
18 month. This credit may be claimed only once with respect to
19 each qualified employee and may not be claimed if the
20 qualified employee has been claimed by a previous employer.
21 (3) The taxpayer's total tax credit under this article
22 may not exceed more than $5,000 in any given tax year.
23 (c) Claim period.--Claims for a tax credit must be filed for
24 the first taxable year for which the taxpayer was eligible for <--
25 the tax credit. Failure to comply with this subsection shall
26 constitute a waiver of the credit. BY THE DEPARTMENT UNDER <--
27 SECTION 1802-C.
28 (D) DEFINITION.--FOR PURPOSES OF THIS SECTION, THE TERM
29 "PENALTY" INCLUDES:
30 (1) TERMINATION, DISCHARGE OR LAYOFF FROM EMPLOYMENT;
20080S1316B1936 - 5 -
1 (2) ADVERSE DISCRIMINATION IN TERMS OF RATES OF PAY,
2 BENEFIT LEVELS, ADVANCEMENT OPPORTUNITIES OR SELECTION FOR
3 JOB TRAINING OPPORTUNITIES.
4 SECTION 1804-C. FIRE AND EMS EMPLOYER CREDITS.
5 A TAXPAYER MAY CLAIM A TAX CREDIT AGAINST THE QUALIFIED TAX
6 LIABILITY OF THE TAXPAYER.
7 Section 1803-C 1805-C. Carryover and carryback of credit. <--
8 (a) General rule.--If the taxpayer cannot use the entire
9 amount of the tax credit for the first taxable year in which the
10 taxpayer is eligible for the credit, then the excess may be
11 carried over to succeeding taxable years and used as a credit
12 against the qualified tax liability of the taxpayer for those
13 taxable years. Each time that the tax credit is carried over to
14 a succeeding taxable year, it shall be reduced by the amount
15 that was used as a credit during the immediately preceding
16 taxable year. The tax credit provided by this article may be
17 carried over and applied to succeeding taxable years for no more
18 than three taxable years following the first taxable year for
19 which the taxpayer was entitled to claim the credit.
20 (b) No carryback.--A taxpayer is not entitled to carry back <--
21 or obtain a refund of an unused tax credit.
22 (B) APPLICATION.--A TAX CREDIT APPROVED BY THE DEPARTMENT IN <--
23 A TAXABLE YEAR FIRST SHALL BE APPLIED AGAINST THE TAXPAYER'S
24 QUALIFIED LIABILITY FOR THE CURRENT TAXABLE YEAR AS OF THE DATE
25 ON WHICH THE CREDIT WAS APPROVED BEFORE THE TAX CREDIT CAN BE
26 APPLIED AGAINST ANY TAX LIABILITY UNDER SUBSECTION (A).
27 (C) NO CARRYBACK, REFUND, SALE OR ASSIGNMENT.--A TAXPAYER IS
28 NOT ENTITLED TO CARRY BACK, OBTAIN A REFUND OF, SELL OR ASSIGN
29 AN UNUSED TAX CREDIT.
30 SECTION 1806-C. PASS-THROUGH ENTITY.
20080S1316B1936 - 6 -
1 (A) GENERAL RULE.--IF A PASS-THROUGH ENTITY HAS ANY UNUSED
2 TAX CREDIT UNDER SECTION 1803-C, IT MAY ELECT IN WRITING,
3 ACCORDING TO PROCEDURES ESTABLISHED BY THE DEPARTMENT, TO
4 TRANSFER ALL OR A PORTION OF THE CREDIT TO SHAREHOLDERS, MEMBERS
5 OR PARTNERS IN PROPORTION TO THE SHARE OF THE ENTITY'S
6 DISTRIBUTIVE INCOME TO WHICH THE SHAREHOLDER, MEMBER OR PARTNER
7 IS ENTITLED.
8 (B) LIMITATION.--A PASS-THROUGH ENTITY AND A SHAREHOLDER,
9 MEMBER OR PARTNER OF A PASS-THROUGH ENTITY SHALL NOT CLAIM THE
10 CREDIT UNDER SUBSECTION (A) FOR THE SAME QUALIFIED VOLUNTEER.
11 (C) APPLICATION.--A SHAREHOLDER, MEMBER OR PARTNER OF A
12 PASS-THROUGH ENTITY TO WHOM A CREDIT IS TRANSFERRED UNDER
13 SUBSECTION (A) SHALL IMMEDIATELY CLAIM THE CREDIT IN THE TAXABLE
14 YEAR IN WHICH THE TRANSFER IS MADE. THE SHAREHOLDER, MEMBER OR
15 PARTNER MAY NOT CARRY FORWARD, CARRY BACK, OBTAIN A REFUND OF OR
16 SELL OR ASSIGN THE CREDIT.
17 Section 1804-C 1807-C. Total amount of credits. <--
18 (A) GENERAL RULE.--The total amount of tax credits <--
19 authorized by this article shall not exceed $5,000,000 in each
20 fiscal year. If the credits exceed the $5,000,000 cap in a given
21 year, the credits will be allocated on a pro rata basis.
22 (B) ALLOCATION.--IF THE TOTAL AMOUNT OF THE TAX CREDITS <--
23 APPLIED FOR BY ALL TAXPAYERS EXCEEDS THE AMOUNT ALLOCATED FOR
24 THOSE CREDITS, THEN THE TAX CREDIT TO BE RECEIVED BY EACH
25 APPLICANT SHALL BE THE PRODUCT OF THE ALLOCATED AMOUNT
26 MULTIPLIED BY THE QUOTIENT OF THE TAX CREDIT APPLIED FOR BY THE
27 APPLICANT DIVIDED BY THE TOTAL OF ALL TAX CREDITS APPLIED FOR BY
28 ALL APPLICANTS, THE ALGEBRAIC EQUIVALENT OF WHICH IS:
29 TAXPAYER'S TAX CREDIT = AMOUNT ALLOCATED FOR THOSE
30 CREDITS X (TAX CREDIT APPLIED FOR BY THE APPLICANT/TOTAL
20080S1316B1936 - 7 -
1 OF ALL CREDITS APPLIED FOR BY ALL APPLICANTS).
2 Section 1805-C 1808-C. Active volunteer point system. <--
3 (a) Duty to develop and implement.--The commissioner and the
4 director shall jointly develop and implement an active volunteer
5 point system establishing the annual requirements for
6 designating firefighters and emergency medical services workers,
7 respectively, as active volunteers.
8 (b) Factors to be considered.--To determine whether a
9 firefighter or emergency medical services worker is active, the
10 point system shall consider the following factors:
11 (1) The number of emergency calls responded to.
12 (2) The volunteer's level of training and participation
13 in formal training and drills.
14 (3) Time spent on administration and support activities,
15 including fundraising and maintenance of facilities and
16 equipment.
17 (4) Involvement in other projects that directly benefit
18 the department's financial viability, emergency response or
19 operational readiness.
20 Section 1806-C 1809-C. Credit verification. <--
21 (a) Volunteer fire company duty to report.--Within ten
22 business days of the end of each calendar year, the chief of
23 each volunteer fire company shall submit a report to the
24 commissioner with the name and address of each volunteer
25 firefighter who qualified for the tax credit for the previous
26 calendar year in the format specified by the secretary.
27 (b) Volunteer emergency medical services and ambulance
28 department duty to report.--Within ten business days of the end
29 of each calendar year, the chief of each volunteer emergency
30 medical services or ambulance department shall submit a report
20080S1316B1936 - 8 -
1 to the director. The report shall include the name and address
2 of each volunteer emergency medical services worker who
3 qualified for the tax credit for the previous calendar year in
4 the format required by the secretary.
5 Section 1807-C 1810-C. Active volunteer certification. <--
6 (a) General rule.--On or before January 31 of each year, the
7 commissioner and the director shall certify each volunteer
8 firefighter or volunteer emergency medical services worker
9 reported under section 1806-C 1809-C as having met the <--
10 requirements for designation as an active volunteer.
11 (b) Procedures.--The commissioner and the director, in
12 cooperation with the secretary, shall jointly develop procedures
13 for documenting volunteer certification for tax credit purposes.
14 Section 1808-C 1811-C. Regulations. <--
15 The department shall prepare any forms that may be necessary
16 to claim a tax credit, may require proof of the claim for tax
17 credit and may adopt rules and regulations to administer the
18 credit.
19 SECTION 1812-C. REPORT TO GENERAL ASSEMBLY. <--
20 NO LATER THAN JUNE 1, 2008, AND SEPTEMBER 1 OF EACH YEAR
21 THEREAFTER, THE SECRETARY SHALL SUBMIT A REPORT TO THE GENERAL
22 ASSEMBLY SUMMARIZING THE UTILIZATION OF THE TAX CREDIT PROVIDED
23 BY THIS ARTICLE WITH FIRE AND EMERGENCY SERVICE RETENTION AND
24 RECRUITMENT EFFORTS. THE REPORT SHALL INCLUDE THE NAME OF THE
25 EMPLOYERS WHO UTILIZED THE CREDIT AS OF THE DATE OF THE REPORT
26 AND THE AMOUNT OF THE CREDITS APPROVED. THE REPORT MAY ALSO
27 INCLUDE ANY RECOMMENDATIONS FOR CHANGES IN THE CALCULATION OR
28 ADMINISTRATION OF THE TAX CREDIT. THE REPORT SHALL BE SUBMITTED
29 TO THE CHAIRMAN AND MINORITY CHAIRMAN OF THE APPROPRIATIONS
30 COMMITTEE OF THE SENATE, THE CHAIRMAN AND MINORITY CHAIRMAN OF
20080S1316B1936 - 9 -
1 THE APPROPRIATIONS COMMITTEE OF THE HOUSE OF REPRESENTATIVES,
2 THE CHAIRMAN AND MINORITY CHAIRMAN OF THE FINANCE COMMITTEE OF
3 THE SENATE AND THE CHAIRMAN AND MINORITY CHAIRMAN OF THE FINANCE
4 COMMITTEE OF THE HOUSE OF REPRESENTATIVES. THE REPORT MAY
5 INCLUDE OTHER INFORMATION THAT THE DEPARTMENT BELIEVES WILL
6 ASSIST IN EVALUATING THE CREDIT PROGRAM.
7 SECTION 1813-C. PENALTY.
8 (A) REPAYMENT TO COMMONWEALTH.--A TAXPAYER WHO CLAIMS A
9 CREDIT UNDER THIS ARTICLE BUT FAILS TO MEET THE STANDARDS STATED
10 IN SECTION 1803-C SHALL REPAY TO THE COMMONWEALTH THE FULL
11 AMOUNT OF THE TAX CREDIT.
12 (B) REINSTATEMENT OF QUALIFIED EMPLOYEES.--ANY TAXPAYER WHO
13 WILLFULLY AND KNOWINGLY VIOLATES THE PROVISIONS OF SECTION 1803-
14 C AND TAKES ADVERSE EMPLOYMENT ACTION AGAINST VOLUNTEERS FOR
15 RESPONDING TO EMERGENCY CALLS SHALL BE REQUIRED TO REINSTATE THE
16 QUALIFIED EMPLOYEE TO HIS OR HER FORMER POSITION. THE TAXPAYER
17 SHALL ALSO PAY THE EMPLOYEE FOR ALL LOST WAGES AND BENEFITS,
18 INCLUDING SENIORITY, FOR THE PERIOD BETWEEN TERMINATION AND
19 REINSTATEMENT TO HIS FORMER POSITION.
20 Section 2. This act shall apply to all taxable years
21 beginning on or after January 1, 2009.
22 Section 3. This act shall take effect immediately.
K27L72DMS/20080S1316B1936 - 10 -