PRINTER'S NO. 2193
No. 1787 Session of 1999
INTRODUCED BY FLICK, BROWNE, TRELLO, SAINATO, ADOLPH, ARMSTRONG,
BAKER, BARRAR, BELFANTI, CALTAGIRONE, CLARK, L. I. COHEN,
DALLY, DeWEESE, FARGO, FICHTER, FRANKEL, GEIST, GODSHALL,
HARHAI, HENNESSEY, HERSHEY, HESS, MARKOSEK, MARSICO,
McILHATTAN, ORIE, PHILLIPS, READSHAW, ROHRER, ROSS, STEELMAN,
STERN, STEVENSON, E. Z. TAYLOR, WILLIAMS, WILT AND
WOJNAROSKI, JULY 20, 1999
REFERRED TO COMMITTEE ON FINANCE, JULY 20, 1999
AN ACT
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," authorizing shareholders of Pennsylvania S
11 corporations and members of partnerships to receive certain
12 deductions from personal income tax.
13 The General Assembly of the Commonwealth of Pennsylvania
14 hereby enacts as follows:
15 Section 1. Section 303 of the act of March 4, 1971 (P.L.6,
16 No.2), known as the Tax Reform Code of 1971, is amended by
17 adding a subsection to read:
18 Section 303. Classes of Income.--* * *
19 (c) (1) For taxable years beginning in calendar year 1999
20 and each taxable year thereafter, a shareholder of a
1 Pennsylvania S corporation or a member of a partnership shall be
2 allowed to take a deduction from the classes of income
3 enumerated in subsection (a)(2), (3) and (4) for net losses
4 carried over pursuant to this subsection. The deduction shall be
5 limited to income received from the Pennsylvania S corporation
6 or a partnership for which the loss is carried over. A loss
7 incurred in one class of income shall not be permitted to be
8 deducted from another class of income.
9 (2) For taxable years beginning in calendar year 1998 and
10 thereafter, a net loss in a class of income enumerated in
11 subsection (a)(2), (3) or (4) incurred by a shareholder of a
12 Pennsylvania S corporation or a member of a partnership as a
13 result of losses incurred by the Pennsylvania S corporation or
14 partnership may be carried over for ten taxable years. The
15 earliest net loss shall be carried over to the earliest taxable
16 year to which it is permitted.
17 Section 2. This act shall take effect immediately.
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