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Senate of Pennsylvania
Session of 2019 - 2020 Regular Session


Posted: December 13, 2018 04:04 PM
From: Senator Thomas H. Killion
To: All Senate members
Subject: Educational Tax Credit Pass-Through Clarification
I plan to introduce legislation which would amend the Public School Code of 1949 with regard to educational tax credits and the definition of “pass-through entity”.

The Educational Improvement Tax Credit (EITC) Program allows for tax credits to eligible businesses contributing to a Scholarship Organization, an Educational Improvement Organization, and/or a Pre-Kindergarten Scholarship Organization.

My legislation is a very simple and straightforward approach. It would amend the definition of “pass-through entity” in Section 2002-B of the Public School Code to also include a qualified Subchapter S trusts, as defined in Section 1361(d)(3) of the Internal Revenue Code of 1986.

Under current law, educational tax credits cannot be transferred from Subchapter S trusts, a distinction which is not grounded in any logical public policy. This legislation would remedy this issue; and was brought to my attention by my constituent, who has done much work on this issue on behalf of many businesses and families of the 9th Senatorial District.

I believe this may prove to be beneficial to other businesses, individuals and families across the Commonwealth.

This legislation will be identical to SB 1194 of the 2017-2018 Legislative Session which was co-sponsored by Senators Brewster, Browne, Folmer, Martin, Mensch, Regan and White.

Please join me in co-sponsoring this legislation.

Introduced as SB230