PRINTER'S NO. 298
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
324
Session of
2021
INTRODUCED BY WHITE, STAATS, THOMAS, NEILSON, GAYDOS, LAWRENCE
AND ROWE, JANUARY 28, 2021
REFERRED TO COMMITTEE ON FINANCE, JANUARY 28, 2021
AN ACT
Amending the act of May 30, 1984 (P.L.345, No.69), entitled "An
act to provide revenue for cities of the first class by
authorizing and imposing a tax on persons engaging in certain
businesses, professions, occupations, trades, vocations and
commercial activities therein; providing for its levy and
collection at the option of cities of the first class;
conferring and imposing powers and duties on cities of the
first class and the collector of city taxes in such cities;
and prescribing penalties," further providing for
definitions.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. The definition of "net operating loss" in section
2 of the act of May 30, 1984 (P.L.345, No.69), known as the
First Class City Business Tax Reform Act, is amended to read:
Section 2. Definitions.
The following words and phrases when used in this act shall
have the meanings given to them in this section unless the
context clearly indicates otherwise:
* * *
"Net operating loss."
(1) In the case of a person conducting its entire
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business within a city of the first class, any net losses
incurred from the operation of its business as returned to
and ascertained by the Federal Government prior to giving
effect to the exclusion for dividends received and net
operating loss subject to the same adjustments made
applicable to net income in this section. In the case of a
person conducting its business both within and without a city
of the first class, any net operating loss incurred which is
carried forward to another tax year shall be allocated and
apportioned in the same manner as net income prior to its
being deducted from apportioned and allocated net income in
the subsequent tax year. Apportionment and allocation of net
operating loss shall be based upon allocation and
apportionment factors applicable to the year in which the net
operating loss was incurred.
(2) Net operating losses incurred in another tax period
may be carried over for [three] 20 tax years following the
year in which it was incurred. The earliest net loss shall be
carried over to the earliest taxable year to which it may be
carried.
* * *
Section 2. The amendment of the definition of "net operating
loss" in section 2 of the act shall apply to net operating
losses incurred in the year of enactment of this act and each
tax year thereafter.
Section 3. This act shall take effect immediately.
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