1Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An
2act relating to tax reform and State taxation by codifying
3and enumerating certain subjects of taxation and imposing
4taxes thereon; providing procedures for the payment,
5collection, administration and enforcement thereof; providing
6for tax credits in certain cases; conferring powers and
7imposing duties upon the Department of Revenue, certain
8employers, fiduciaries, individuals, persons, corporations
9and other entities; prescribing crimes, offenses and
10penalties," providing for child support tax credit.

11The General Assembly of the Commonwealth of Pennsylvania
12hereby enacts as follows:

13Section 1. The act of March 4, 1971 (P.L.6, No.2), known as 
14the Tax Reform Code of 1971, is amended by adding an article to
15read:

16ARTICLE XIX-B

17CHILD SUPPORT TAX CREDIT

18Section 1901-B. Scope of article.

19This article relates to child support tax credits.

20Section 1902-B. Definitions.

21The following words and phrases when used in this article
22shall have the meanings given to them in this section unless the

1context clearly indicates otherwise:

2"Child support payments." Payments made under child support
3awarded pursuant to the Statewide guideline established by the
4Supreme Court under the authority of 23 Pa.C.S. § 4322 (relating
5to support guidelines).

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

7"Qualified tax liability." The liability for taxes imposed
8under Article III for the taxable year.

9"Tax credit." The tax credit under this article available to
10those making child support payments.

11"Taxpayer." An individual subject to payment of taxes under
12Article III.

13Section 1903-B. Application.

14(a) Application to department.--A taxpayer may submit an
15application for a tax credit under this article in a manner
16required by the department. The application shall contain the
17following information:

18(1) The name and tax identification number of the
19taxpayer.

20(2) The names of all children for whom the taxpayer
21provides child support.

22(3) Certification of payment of child support as
23determined by the department.

24(4) Any other information deemed appropriate by the
25department.

26(b) Procedure.--The application shall be attached to the
27taxpayer's annual tax return required to be filed under Article
28III.

29Section 1904-B. Taxpayer credit.

30(a) Credit.--A taxpayer shall be eligible for a tax credit

1under subsection (b) against the tax imposed under Article III
2if the taxpayer makes all child support payments during the tax
3year on time.

4(b) Maximum credit.--A taxpayer who qualifies under
5subsection (a) may claim a tax credit of $300 against the
6qualified tax liability of the taxpayer.

7Section 1905-B. Carryover and carryback.

8(a) General rule.--If the taxpayer cannot use the entire
9amount of tax credit for the taxable year in which the taxpayer
10is eligible for the credit, the excess may be carried over to
11succeeding taxable years and used as a credit against the
12qualified tax liability of the taxpayer for those taxable years.
13Each time the tax credit is carried over to a succeeding taxable
14year, it shall be reduced by the amount that was used as a
15credit during the immediately preceding taxable year. The tax
16credit provided by this article may be carried over and applied
17to succeeding taxable years for no more than three taxable years
18following the first taxable year for which the taxpayer was
19entitled to claim the credit.

20(b) Application.--A tax credit approved by the department in
21a taxable year shall first be applied against the taxpayer's
22qualified liability for the current taxable year as of the date
23on which the credit was approved before the tax credit can be
24applied against any tax liability under subsection (a).

25(c) Limitations.--A taxpayer is not entitled to carry back,
26obtain a refund of, sell or assign an unused tax credit.

27Section 1906-B. Guidelines.

28The department shall adopt guidelines, including forms,
29necessary to administer this article. The department may require
30proof of the claim for tax credit.

1Section 1907-B. Penalty.

2A taxpayer who claims a credit under this article, but fails
3to meet the standards under section 1905-B, shall repay the full
4amount of the tax credit to the Commonwealth.

5Section 2. This act shall take effect in 60 days.