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PRINTER'S NO. 1620
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
1485
Session of
2021
INTRODUCED BY QUINN, FREEMAN, D. WILLIAMS, TOMLINSON, ROTHMAN,
KULIK, SMITH, CONKLIN, THOMAS, MADDEN, SCHLOSSBERG, HILL-
EVANS, POLINCHOCK, BROOKS, RYAN, SCHLEGEL CULVER, DELLOSO,
ZIMMERMAN, R. BROWN, STEPHENS, WARREN, CIRESI, ROZZI,
STRUZZI, GILLEN AND PISCIOTTANO, MAY 26, 2021
REFERRED TO COMMITTEE ON VETERANS AFFAIRS AND EMERGENCY
PREPAREDNESS, MAY 26, 2021
AN ACT
Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An
act relating to tax reform and State taxation by codifying
and enumerating certain subjects of taxation and imposing
taxes thereon; providing procedures for the payment,
collection, administration and enforcement thereof; providing
for tax credits in certain cases; conferring powers and
imposing duties upon the Department of Revenue, certain
employers, fiduciaries, individuals, persons, corporations
and other entities; prescribing crimes, offenses and
penalties," establishing the Active Volunteer First Responder
Education Tax Credit Program.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. The act of March 4, 1971 (P.L.6, No.2), known as
the Tax Reform Code of 1971, is amended by adding an article to
read:
ARTICLE XVIII-I
ACTIVE VOLUNTEER FIRST RESPONDER
EDUCATION TAX CREDIT
Section 1801-I. Scope of article.
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This article relates to the Active Volunteer First Responder
Tax Credit.
Section 1802-I. Definitions.
The following words and phrases when used in this article
shall have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Active volunteer first responder." A volunteer for a
volunteer fire company or nonprofit emergency medical services
agency who is certified under 35 Pa.C.S. § 79A23 (relating to
certification).
"Approved institution of higher learning." Any of the
following:
(1) A public college or technical institute that is
established and operated in accordance with the provisions of
the act of March 10, 1949 (P.L.30, No.14), known as the
Public School Code of 1949, by a local sponsor that provides
a two-year, postsecondary, college-parallel, terminal-
general, terminal-technical, out-of-school youth or adult
education program or any combination of the programs.
(2) An institution that is part of the State System of
Higher Education under Article XX-A of the Public School Code
of 1949, and all branches and campuses of a State-owned
institution.
"Approved program of education." A curriculum or course of
study pursued at an approved institution of higher learning.
"Business firm." An entity authorized to do business in this
Commonwealth and subject to taxes imposed under Article III, IV,
VI, VII, VIII, IX, XV or XX or a tax imposed under Article XVI
of the act of May 17, 1921 (P.L.682, No.284), known as The
Insurance Company Law of 1921. The term includes a pass-through
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entity, including a pass-through entity the purpose of which is
making contributions under this article and whose shareholders,
partners or members are composed of owners or employees of other
business firms.
"Contribution." A donation of cash, personal property or
services, the value of which is the net cost of the donation to
the donor or the pro rata hourly wage, including benefits, of
the individual performing the service.
"Department." The Department of Community and Economic
Development of the Commonwealth.
"Eligible organization." An approved institution of higher
learning that is determined to be eligible by the department.
"Eligible student." An active volunteer first responder who
meets the following criteria:
(1) Is a resident of this Commonwealth.
(2) Has been an active volunteer first responder for a
period of at least one year in this Commonwealth.
(3) Has enrolled as a student in an approved program of
education at an approved institution of higher learning.
(4) Provides the approved institution of higher learning
with a sworn or official statement by the Office of the State
Fire Commissioner or the chief or president of the volunteer
emergency medical services agency, attesting that the
applicant is a member in good standing of the volunteer
emergency medical services agency or volunteer fire company.
"Nonprofit emergency medical services agency." An emergency
medical services agency, as defined in 35 Pa.C.S. § 8103
(relating to definitions), that is chartered as a nonprofit
corporation.
"Program." The Active Volunteer First Responder Education
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Tax Credit Program established under section 1803-I(a).
"Scholarship." An award under this article to pay tuition
and school-related fees to attend an approved institution of
higher learning.
"School-related fees." A fee charged by an approved
institution of higher learning to all students for books,
instructional materials, technology equipment and services,
uniforms and activities.
"Tax credit." The tax credit authorized under this article.
"Volunteer fire company." A nonprofit chartered corporation,
association or organization, located in this Commonwealth that
provides fire protection services and may offer other voluntary
emergency services within this Commonwealth.
Section 1803-I. Active Volunteer First Responder Education Tax
Credit Program.
(a) Establishment.--The Active Volunteer First Responder
Education Tax Credit Program is established to assist active
volunteer first responders with access to higher education by an
approved institution of higher learning. The department shall
administer the program.
(b) Eligible organization application.--In order to qualify
for contributions under this article, an eligible organization
must submit information to the department to confirm that the
eligible organization offers accredited degrees or certificate
programs. The information shall be submitted on a form provided
by the department.
(c) Restriction on use of contributions.--The contributions
received by an eligible organization from a business firm
claiming a tax credit under this article must be used for
scholarships awarded to eligible students.
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(d) Publication.--The department shall do all of the
following:
(1) Annually publish a list of each eligible
organization under this section in the Pennsylvania Bulletin.
(2) Post and update the list under paragraph (1) as
necessary on the publicly accessible Internet website of the
department.
Section 1804-I. Business firm.
(a) Business firm application.--A business firm may apply to
the department for a tax credit for contributions made to an
eligible organization that appears on the list under section
1803-I(d)(1) on a form provided by the department.
(b) Notification.--No later than 60 days after the
organization or business firm has submitted the application
required under this section, the department shall notify the
eligible organization and business firm whether the eligible
organization and business firm meet the requirements under this
article for the fiscal year.
(c) Contributions.--A contribution by a business firm to an
eligible organization must be made no later than 60 days
following the approval of an application under subsection (b).
Section 1805-I. Award of scholarships.
(a) Eligible organizations.--An eligible organization shall
award an eligible student a scholarship of up to $5,000 per
eligible student to attend an approved institution of higher
learning. The award of a scholarship shall be based on
enrollment status as follows:
(1) A full-time student who is enrolled in at least six
credits per semester shall be eligible to receive a
scholarship of up to $5,000.
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(2) A part-time student who is enrolled in at least
three credits per semester shall be eligible to receive a
scholarship of up to $2,500.
(b) Requirements.--An eligible student must do all of the
following:
(1) Apply to the department for a scholarship under the
program.
(2) Be enrolled as a student at an approved institution
of higher learning.
(3) Be enrolled as a student in an approved program of
education.
(4) Obtain signatures on the application attesting to
the individual's status as an active volunteer first
responder of:
(i) the chief or president of the volunteer fire
company or volunteer rescue company and another officer
of the volunteer fire company or volunteer rescue
company; or
(ii) the chief or president of the emergency medical
services agency and another officer of the emergency
medical services agency.
(5) Upon completion of an accredited degree or
certificate program, maintain active volunteer first
responder status for at least five years.
(c) Penalty.--If an eligible student does not maintain
active volunteer first responder status for five years upon
completion of approved program of education the eligible student
must pay back 20% per year pro rata of the awarded scholarship.
Section 1806-I. Grant of tax credit.
(a) General rule.--In accordance with section 1804-I, the
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department shall grant a tax credit certificate. The certificate
may be used against a tax liability owed to the Department of
Revenue by a business firm that provides proof of a contribution
to a provider in the taxable year in which the contribution is
made. The business firm may apply the credit against any tax due
under Article III, IV, VI, VII, VIII, IX or XV, except for any
tax withheld by an employer under Article III.
(b) Availability of tax credits.--Tax credits under this
section shall be made available by the department on a first-
come, first-served basis.
(c) Limitation.--The tax credit may not exceed 50% of the
total amount contributed by a business firm to an eligible
organization during the taxable year of the business firm. The
tax credit shall not exceed $2,500 annually per business firm.
(d) Additional amount.--
(1) A business firm that contributes to a provider in
two or more consecutive years shall qualify for a 90% tax
credit for the contributions made in the second year and
every consecutive year of making a contribution to a
provider.
(2) Nothing under this paragraph may be construed to
require a business firm to contribute to the same eligible
organization every year in order for the business firm to
qualify for a tax credit under this subsection.
(e) Pass-through entity.--
(1) If a pass-through entity does not intend to use
each approved tax credit under this section, the pass-through
entity may elect in writing to distribute for no
consideration all or a portion of the credit to shareholders,
members or partners in proportion to the percentage interest
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of the shareholder, member or partner in distributions from
the pass-through entity. The credits may be used by the
shareholders, members or partners in the taxable year in
which the contribution is made or in the taxable year
immediately following the year in which the contribution is
made. The election shall designate the year in which the
distributed credits are to be used and shall be made
according to procedures established by the Department of
Revenue. A pass-through entity that received a distribution
from a pass-through entity under this paragraph may make a
distribution under this paragraph.
(2) A pass-through entity and a shareholder, member or
partner of a pass-through entity may not claim the credit
under this section for the same contribution.
(3) A shareholder, member or partner may not carry
forward, carry back, obtain a refund of or sell or assign the
credit.
(4) An individual shareholder, partner or member may
apply a credit distributed under this section to income
taxable under Article III to the shareholder, partner or
member, to the spouse of the shareholder, partner or member
or to both, if both the shareholder, partner or member and
the spouse report income on a joint personal income tax
return.
Section 1807-I. Amount of tax credit.
(a) Limitation.--The total aggregate amount of all tax
credits approved under this article may not exceed $10,000,000
in a fiscal year.
(b) Activities.--A tax credit may not be approved for
activities that are part of a business firm's normal course of
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business.
(c) Tax liability.--
(1) A tax credit granted for any one taxable year may
not exceed the tax liability of a business firm.
(2) A tax credit granted to a pass-through entity that
elects to distribute the granted tax credit according to
section 1806-I(a) for any one taxable year to a shareholder,
member or partner may not exceed the tax liability of the
shareholder, member or partner.
(d) Use.--A tax credit not used in the taxable year the
contribution was made may not be carried forward or carried back
and is not refundable or transferable.
Section 1808-I. Guidelines.
The department, in conjunction with the Department of
Revenue, shall establish guidelines to implement this article
within 90 days of the effective date of this section.
Section 1809-I. Limitation.
A business firm may not apply for a tax credit after the
seventh fiscal year following the effective date of this
section.
Section 2. The addition of Article XVIII-I of the act shall
apply to taxable years commencing after December 31, 2020.
Section 3. This act shall take effect immediately.
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