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| THE GENERAL ASSEMBLY OF PENNSYLVANIA |
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| SENATE BILL |
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| INTRODUCED BY MENSCH, PILEGGI, GREENLEAF, WAUGH, ORIE, EICHELBERGER, VOGEL, YAW, FOLMER, PICCOLA, ARGALL, BREWSTER, ALLOWAY, KASUNIC, D. WHITE, M. WHITE, PIPPY, BOSCOLA AND EARLL, JANUARY 21, 2011 |
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| REFERRED TO FINANCE, JANUARY 21, 2011 |
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| AN ACT |
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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 apportionment of business income. |
11 | The General Assembly of the Commonwealth of Pennsylvania |
12 | hereby enacts as follows: |
13 | Section 1. Section 401(3)2(a)(9) of the act of March 4, 1971 |
14 | (P.L.6, No.2), known as the Tax Reform Code of 1971, amended |
15 | October 9, 2009 (P.L.451, No.48), is amended to read: |
16 | Section 401. Definitions.--The following words, terms, and |
17 | phrases, when used in this article, shall have the meaning |
18 | ascribed to them in this section, except where the context |
19 | clearly indicates a different meaning: |
20 | * * * |
21 | (3) "Taxable income." * * * |
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1 | 2. In case the entire business of any corporation, other |
2 | than a corporation engaged in doing business as a regulated |
3 | investment company as defined by the Internal Revenue Code of |
4 | 1986, is not transacted within this Commonwealth, the tax |
5 | imposed by this article shall be based upon such portion of the |
6 | taxable income of such corporation for the fiscal or calendar |
7 | year, as defined in subclause 1 hereof, and may be determined as |
8 | follows: |
9 | (a) Division of Income. |
10 | * * * |
11 | (9) (A) Except as provided in subparagraph (B): |
12 | (i) For taxable years beginning before January 1, 2007, all |
13 | business income shall be apportioned to this State by |
14 | multiplying the income by a fraction, the numerator of which is |
15 | the property factor plus the payroll factor plus three times the |
16 | sales factor and the denominator of which is five. |
17 | (ii) For taxable years beginning after December 31, 2006, |
18 | all business income shall be apportioned to this State by |
19 | multiplying the income by a fraction, the numerator of which is |
20 | the sum of fifteen times the property factor, fifteen times the |
21 | payroll factor and seventy times the sales factor and the |
22 | denominator of which is one hundred. |
23 | (iii) For taxable years beginning after December 31, 2008, |
24 | all business income shall be apportioned to this State by |
25 | multiplying the income by [a fraction, the numerator of which is |
26 | the sum of eight and a half times the property factor, eight and |
27 | a half times the payroll factor and eighty-three times the sales |
28 | factor and the denominator of which is one hundred. |
29 | (iv) For taxable years beginning after December 31, 2009, |
30 | all business income shall be apportioned to this State by |
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1 | multiplying the income by a fraction, the numerator of which is |
2 | the sum of five times the property factor, five times the |
3 | payroll factor and ninety times the sales factor and the |
4 | denominator of which is one hundred] the sales factor. |
5 | (B) For purposes of apportionment of the capital stock - |
6 | franchise tax as provided in section 602 of Article VI of this |
7 | act, the apportionment fraction shall be the property factor |
8 | plus the payroll factor plus the sales factor as the numerator, |
9 | and the denominator shall be three. |
10 | * * * |
11 | Section 2. This act shall take effect in 60 days. |
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