SENATE AMENDED
PRIOR PRINTER'S NOS. 441, 2809, 2849, PRINTER'S NO. 4195
3094, 4086
No. 377 Session of 2007
INTRODUCED BY D. EVANS, BENNINGTON, BUXTON, CALTAGIRONE, CURRY,
FREEMAN, GALLOWAY, LEVDANSKY, MARKOSEK, MYERS, PARKER,
PRESTON, WALKO, WHEATLEY, PETRONE, WAGNER, KORTZ, FRANKEL AND
M. O'BRIEN, FEBRUARY 13, 2007
SENATOR ARMSTRONG, APPROPRIATIONS, IN SENATE, RE-REPORTED AS
AMENDED, JULY 3, 2008
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," in sales and use tax, further providing for <--
11 definitions and for exclusions; in personal income tax,
12 further providing for imposition, providing an alternative
13 special tax provision for poverty; further providing for
14 requirement of withholding tax; in corporate net income tax,
15 further providing for definitions and for imposition; in
16 capital stock-franchise tax, further providing for
17 definitions and reports; in gross receipts tax, further
18 providing for imposition; in research and development tax
19 credits, further providing for carryover, carryback, refund
20 and assignment of credit, for time limitations, for
21 limitation on credits and for termination; providing for a
22 small business health savings account tax credit and for a
23 new diesel technology tax credit; in inheritance tax, further
24 providing for imposition, for inheritance tax rates and for
25 estate tax; and making a related repeal. IN PERSONAL INCOME <--
26 TAX, FURTHER PROVIDING FOR CLASSES OF INCOME AND FOR SPECIAL
27 TAX PROVISIONS FOR POVERTY; AND, IN CORPORATE NET INCOME TAX,
28 FURTHER PROVIDING FOR THE DEFINITION OF "TAXABLE INCOME." IN <--
29 PERSONAL INCOME TAX, PROVIDING FOR ALTERNATIVE SPECIAL TAX
1 PROVISION FOR POVERTY STUDY; FURTHER PROVIDING FOR
2 CONTRIBUTIONS TO BREAST AND CERVICAL CANCER RESEARCH; AND
3 PROVIDING FOR VOLUNTEER RESPONDER RETENTION AND RECRUITMENT
4 TAX CREDIT.
5 The General Assembly of the Commonwealth of Pennsylvania
6 hereby enacts as follows:
7 Section 1. Section 201(m) of the act of March 4, 1971 <--
8 (P.L.6, No.2), known as the Tax Reform Code of 1971, amended May
9 24, 2000 (P.L.106, No.23), is amended to read:
10 Section 201. Definitions.--The following words, terms and
11 phrases when used in this Article II shall have the meaning
12 ascribed to them in this section, except where the context
13 clearly indicates a different meaning:
14 * * *
15 (m) "Tangible personal property."
16 (1) Corporeal personal property including, but not limited
17 to, goods, wares, merchandise, steam and natural and
18 manufactured and bottled gas for non-residential use,
19 electricity for non-residential use, prepaid telecommunications,
20 premium cable or premium video programming service, spirituous
21 or vinous liquor and malt or brewed beverages and soft drinks,
22 interstate telecommunications service originating or terminating
23 in the Commonwealth and charged to a service address in this
24 Commonwealth, intrastate telecommunications service with the
25 exception of (i) subscriber line charges and basic local
26 telephone service for residential use and (ii) charges for
27 telephone calls paid for by inserting money into a telephone
28 accepting direct deposits of money to operate, provided further,
29 the service address of any intrastate telecommunications service
30 is deemed to be within this Commonwealth or within a political
31 subdivision, regardless of how or where billed or paid. In the
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1 case of any such interstate or intrastate telecommunications
2 service, any charge paid through a credit or payment mechanism
3 which does not relate to a service address, such as a bank,
4 travel, credit or debit card, but not including prepaid
5 telecommunications, is deemed attributable to the address of
6 origination of the telecommunications service. The term shall
7 not include computer software, other than prewritten computer
8 software delivered to the purchaser by tangible storage media.
9 (2) For the purposes of this clause, the following words and
10 phrases shall have the meanings given to them in this subclause:
11 "Computer software." A set of coded instructions designed to
12 cause a computer or automatic data processing equipment to
13 perform a task.
14 "Prewritten computer software." The term shall have the same
15 meaning as "computer software," including prewritten upgrades,
16 which is not designed and developed by the author or other
17 creator to the specifications of a specific purchaser. The
18 combining of two or more prewritten computer software programs
19 or prewritten portions of the program does not cause the
20 combination to be other than prewritten computer software. The
21 term includes software designed and developed by the author or
22 other creator to the specifications of a specific purchaser when
23 it is sold to a person other than the specific purchaser. Where
24 a person modifies or enhances computer software of which the
25 person is not the author or creator, the person shall be deemed
26 to be the author or creator only of the person's modifications
27 or enhancements. Prewritten computer software or a prewritten
28 portion of prewritten computer software that is modified or
29 enhanced to any degree, where the modification or enhancement is
30 designed and developed to the specifications of a specific
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1 purchaser, remains prewritten computer software except that
2 where there is a reasonable, separately stated charge, invoice
3 or other statement of the price given to the purchaser for the
4 modification or enhancement, the modification or enhancement
5 shall not constitute prewritten computer software.
6 * * *
7 Section 2. Section 204(10) of the act, amended April 23,
8 1998 (P.L.239, No.45), is amended and the section is amended by
9 adding clauses to read:
10 Section 204. Exclusions from Tax.--The tax imposed by
11 section 202 shall not be imposed upon any of the following:
12 * * *
13 (10) The sale at retail to or use by (i) any charitable
14 organization, volunteer firemen's organization or nonprofit
15 educational institution, or (ii) a religious organization for
16 religious purposes of tangible personal property or services
17 other than pursuant to a construction contract: Provided,
18 however, That the exclusion of this clause shall not apply with
19 respect to any tangible personal property or services used in
20 any unrelated trade or business carried on by such organization
21 or institution or with respect to any materials, supplies and
22 equipment used and transferred to such organization or
23 institution in the construction, reconstruction, remodeling,
24 renovation, repairs and maintenance of any real estate
25 structure, other than building machinery and equipment, except
26 materials and supplies when purchased by such organizations or
27 institutions for routine maintenance and repairs[.], unless the
28 organization or institution is a charitable organization in the
29 trade or business of construction, reconstruction, remodeling or
30 renovation of any real estate structure.
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1 * * *
2 (67) Fees charged by nonprofit humane organizations to
3 transfer custody and possession of animals that are used as
4 household pets.
5 (68) The sale at retail or use of building materials and
6 supplies used for the construction or repair of animal
7 production buildings regardless if the sale is made to the
8 purchaser directly or pursuant to a construction contract.
9 Section 3. Section 302 of the act, amended December 23, 2003
10 (P.L.250, No.46), is amended to read:
11 Section 302. Imposition of Tax.--(a) Every resident
12 individual, estate or trust shall be subject to, and shall pay
13 for the privilege of receiving each of the classes of income
14 hereinafter enumerated in section 303, a tax upon each dollar of
15 income received by that resident during that resident's taxable
16 year at the [rate of three and seven hundredths per cent.]
17 following rates:
18 (1) Three and seven hundredths per cent for the first half
19 of the taxable year commencing with or within calendar year
20 2008.
21 (2) Two and ninety-three hundredths per cent for the second
22 half of the taxable year commencing with or within calendar year
23 2008.
24 (3) Two and eight-tenths per cent for the taxable year
25 commencing with or within calendar year 2009 and each taxable
26 year thereafter.
27 (b) Every nonresident individual, estate or trust shall be
28 subject to, and shall pay for the privilege of receiving each of
29 the classes of income hereinafter enumerated in section 303 from
30 sources within this Commonwealth, a tax upon each dollar of
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1 income received by that nonresident during that nonresident's
2 taxable year at the [rate of three and seven hundredths per
3 cent.] following rates:
4 (1) Three and seven hundredths per cent for the first half
5 of the taxable year commencing with or within calendar year
6 2008.
7 (2) Two and ninety-three hundredths per cent for the second
8 half of the taxable year commencing with or within calendar year
9 2008.
10 (3) Two and eight-tenths per cent for the taxable year
11 commencing with or within calendar year 2009 and each taxable
12 year thereafter.
13 Section 4. The act is amended by adding a section to read:
14 Section 304.1. Alternative Special Tax Provision for
15 Poverty.--(a) Pursuant to section 2(b)(ii) of Article VIII of
16 the Constitution of the Commonwealth of Pennsylvania, which
17 provides for establishing as a class or classes of subjects of
18 taxation the property or privileges of persons who, because of
19 poverty, are determined to be in need of special tax provisions,
20 the General Assembly hereby declares its intent and purpose to
21 exercise its power pursuant to that section by enacting the
22 alternative tax provisions of this section.
23 (b) Having determined that there are certain persons in this
24 Commonwealth whose incomes are such that imposition of an income
25 tax would deprive them and their dependents of bare necessities
26 of life, and having determined that poverty is a relative
27 concept inextricably joined with actual income and the number of
28 people dependent upon such income, the General Assembly deems it
29 to be a matter of public policy to provide special tax
30 provisions for that class of persons to relieve their economic
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1 burden.
2 (c) For the taxable year beginning after December 31, 2007,
3 an individual having one or more dependents may, in lieu of
4 utilizing the special tax provisions for poverty in section 304,
5 claim a refund equal to fifteen per cent of the earned income
6 credit allowable under section 32 of the Internal Revenue Code
7 of 1986 (Public Law 99-514, 26 U.S.C. § 32), as amended.
8 (d) For taxable years beginning after December 31, 2008, an
9 individual having one or more dependents may, in lieu of
10 utilizing the special tax provisions for poverty in section 304,
11 claim a refund equal to thirty per cent of the earned income
12 credit allowable under section 32 of the Internal Revenue Code
13 of 1986, as amended.
14 Section 5. Section 316 of the act, added August 31, 1971
15 (P.L.362, No.93), is amended to read:
16 Section 316. Requirement of Withholding Tax.--[Every] (a)
17 Except as provided under subsection (b), every employer
18 maintaining an office or transacting business within this
19 Commonwealth and making payment of compensation [(i)] (1) to a
20 resident individual, or [(ii)] (2) to a nonresident individual
21 taxpayer performing services on behalf of such employer within
22 this Commonwealth, shall deduct and withhold from such
23 compensation for each payroll period a tax computed in such
24 manner as to result, so far as practicable, in withholding from
25 the employe's compensation during each calendar year an amount
26 substantially equivalent to the tax reasonably estimated to be
27 due for such year with respect to such compensation. The method
28 of determining the amount to be withheld shall be prescribed by
29 regulations of the department.
30 (b) Subsection (a) shall not apply to the withholding of tax
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1 from compensation of any resident or nonresident individual
2 serving in the armed forces of the United States in an area
3 designated by the President of the United States by Executive
4 Order as a combat zone as described under section 7508 of the
5 Internal Revenue Code of 1986 (Public Law 99-514, 26 U.S.C. §
6 7508), as amended, at any time during the period designated by
7 the President by Executive Order as the period of combatant
8 activities in the combat zone or hospitalized as a result of
9 injury received while serving in the combat zone during such
10 time.
11 Section 6. Section 401(3)2(a)(9) and 4(c) of the act,
12 amended July 12, 2006 (P.L.1137, No.116), are amended to read:
13 Section 401. Definitions.--The following words, terms, and
14 phrases, when used in this article, shall have the meaning
15 ascribed to them in this section, except where the context
16 clearly indicates a different meaning:
17 * * *
18 (3) "Taxable income." * * *
19 2. In case the entire business of any corporation, other
20 than a corporation engaged in doing business as a regulated
21 investment company as defined by the Internal Revenue Code of
22 1986, is not transacted within this Commonwealth, the tax
23 imposed by this article shall be based upon such portion of the
24 taxable income of such corporation for the fiscal or calendar
25 year, as defined in subclause 1 hereof, and may be determined as
26 follows:
27 (a) Division of Income.
28 * * *
29 (9) (A) Except as provided in subparagraph (B):
30 (i) For taxable years beginning before January 1, 2007, all
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1 business income shall be apportioned to this State by
2 multiplying the income by a fraction, the numerator of which is
3 the property factor plus the payroll factor plus three times the
4 sales factor and the denominator of which is five.
5 (ii) For taxable years beginning after December 31, 2006,
6 and ending before January 1, 2008, all business income shall be
7 apportioned to this State by multiplying the income by a
8 fraction, the numerator of which is the sum of fifteen times the
9 property factor, fifteen times the payroll factor and seventy
10 times the sales factor and the denominator of which is one
11 hundred.
12 (iii) For taxable years beginning after December 31, 2007,
13 all business income shall be apportioned to this State by
14 multiplying the income by the sales factor.
15 (B) For purposes of apportionment of the capital stock -
16 franchise tax as provided in section 602 of Article VI of this
17 act, the apportionment fraction shall be the property factor
18 plus the payroll factor plus the sales factor as the numerator,
19 and the denominator shall be three.
20 * * *
21 4. * * *
22 (c) (1) The net loss deduction shall be the lesser of:
23 (A) (I) For taxable years beginning before January 1, 2007,
24 two million dollars ($2,000,000);
25 (II) For taxable years beginning after December 31, 2006,
26 and before January 1, 2008, the greater of twelve and one-half
27 per cent of taxable income as determined under subclause 1 or,
28 if applicable, subclause 2 or three million dollars
29 ($3,000,000); [or]
30 (III) For taxable years beginning after December 31, 2007,
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1 one hundred per cent of taxable income as determined under
2 subclause 1 or, if applicable, subclause 2; or
3 (B) The amount of the net loss or losses which may be
4 carried over to the taxable year or taxable income as determined
5 under subclause 1 or, if applicable, subclause 2.
6 [(1.1) In no event shall the net loss deduction include more
7 than five hundred thousand dollars ($500,000), in the aggregate,
8 of net losses from taxable years 1988 through 1994.]
9 (2) (A) A net loss for a taxable year may only be carried
10 over pursuant to the following schedule:
11 Taxable Year Carryover
12 1981 1 taxable year
13 1982 2 taxable years
14 1983-1987 3 taxable years
15 1988 2 taxable years plus
16 1 taxable year
17 starting with the
18 1995 taxable year
19 1989 1 taxable year plus
20 2 taxable years
21 starting with the
22 1995 taxable year
23 1990-1993 3 taxable years
24 starting with the
25 1995 taxable year
26 1994 1 taxable year
27 1995-1997 10 taxable years
28 1998 and thereafter 20 taxable years
29 (B) The earliest net loss shall be carried over to the
30 earliest taxable year to which it may be carried under this
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1 schedule. The total net loss deduction allowed in any taxable
2 year shall not exceed:
3 (I) Two million dollars ($2,000,000) for taxable years
4 beginning before January 1, 2007.
5 (II) The greater of twelve and one-half per cent of the
6 taxable income as determined under subclause 1 or, if
7 applicable, subclause 2 or three million dollars ($3,000,000)
8 for taxable years beginning after December 31, 2006[.], and
9 before January 1, 2008.
10 (III) One hundred per cent of taxable income as determined
11 under subclause 1 or, if applicable, subclause 2 for taxable
12 years beginning after December 31, 2007.
13 * * *
14 Section 7. Section 402(b) of the act, amended June 29, 2002
15 (P.L.559, No.89), is amended to read:
16 Section 402. Imposition of Tax.--* * *
17 (b) The annual rate of tax on corporate net income imposed
18 by subsection (a) for taxable years beginning for the calendar
19 year or fiscal year on or after the dates set forth shall be as
20 follows:
21 Taxable Year Tax Rate
22 January 1, 1995, [and
23 each taxable
24 year thereafter]
25 through taxable
26 years beginning
27 on or before
28 December 31, 2008 9.99%
29 January 1, 2009, and
30 each taxable
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1 year through
2 December 31, 2009 7.90%
3 January 1, 2010, and
4 each taxable
5 year through
6 December 31, 2010 7.70%
7 January 1, 2011, and
8 each taxable
9 year through
10 December 31, 2011 7.50%
11 January 1, 2012, and
12 each taxable
13 year through
14 December 31, 2012 7.30%
15 January 1, 2013, and
16 each taxable
17 year through
18 December 31, 2013 7.10%
19 January 1, 2014, and
20 each taxable
21 year thereafter 6.90%
22 * * *
23 Section 8. The definition of "capital stock value" in
24 section 601(a) of the act, amended July 6, 2006 (P.L.319,
25 No.67), is amended to read:
26 Section 601. Definitions and Reports.--(a) The following
27 words, terms and phrases when used in this Article VI shall have
28 the meaning ascribed to them in this section, except where the
29 context clearly indicates a different meaning:
30 * * *
20070H0377B4195 - 12 -
1 "Capital stock value." The amount computed pursuant to the
2 following formula: the product of one-half times the sum of the
3 average net income capitalized at the rate of nine and one-half
4 per cent plus seventy-five per cent of net worth, from which
5 product shall be subtracted [one hundred fifty thousand dollars
6 ($150,000)] three hundred thousand dollars ($300,000), the
7 algebraic equivalent of which is
8 (.5 X (average net income/.095 + (.75)
9 (net worth))) - [$150,000] $300,000
10 * * *
11 Section 9. Section 1101(a), (a.1) and (j) of the act,
12 amended or added December 23, 2003 (P.L.250, No.46), are amended
13 to read:
14 Section 1101. Imposition of Tax.--(a) General Rule.--Every
15 pipeline company, conduit company, steamboat company, canal
16 company, slack water navigation company, transportation company,
17 and every other company, association, joint-stock association,
18 or limited partnership, now or hereafter incorporated or
19 organized by or under any law of this Commonwealth, or now or
20 hereafter organized or incorporated by any other state or by the
21 United States or any foreign government, and doing business in
22 this Commonwealth, and every copartnership, person or persons
23 owning, operating or leasing to or from another corporation,
24 company, association, joint-stock association, limited
25 partnership, copartnership, person or persons, any pipeline,
26 conduit, steamboat, canal, slack water navigation, or other
27 device for the transportation of freight, passengers, baggage,
28 or oil, except motor vehicles and railroads, and every limited
29 partnership, association, joint-stock association, corporation
30 or company engaged in, or hereafter engaged in, the
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1 transportation of freight or oil within this State, and every
2 telephone company , telegraph company or provider of mobile
3 telecommunications services now or hereafter incorporated or
4 organized by or under any law of this Commonwealth, or now or
5 hereafter organized or incorporated by any other state or by the
6 United States or any foreign government and doing business in
7 this Commonwealth, and every limited partnership, association,
8 joint-stock association, copartnership, person or persons,
9 engaged in telephone or telegraph business or providing mobile
10 telecommunications services in this Commonwealth, shall pay to
11 the State Treasurer, through the Department of Revenue, a tax of
12 forty-five mills with a surtax equal to five mills upon each
13 dollar of the gross receipts of the corporation, company or
14 association, limited partnership, joint-stock association,
15 copartnership, person or persons, received from:
16 (1) passengers, baggage, oil and freight transported wholly
17 within this State;
18 (2) telegraph or telephone messages transmitted wholly
19 within this State and telegraph or telephone messages
20 transmitted in interstate commerce after December 31, 2003, and
21 before January 1, 2008, where such messages originate or
22 terminate in this State and the charges for such messages are
23 billed to a service address in this State, except gross receipts
24 derived from:
25 (i) the sales of access to the Internet, as set forth in
26 Article II, made to the ultimate consumer; and
27 (ii) the sales for resale to persons, partnerships,
28 associations, corporations or political subdivisions subject to
29 the tax imposed by this article upon gross receipts derived from
30 such resale of telecommunications services, including:
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1 (A) telecommunications exchange access to interconnect with
2 a local exchange carrier's network;
3 (B) network elements on an unbundled basis; and
4 (C) sales of telecommunications services to interconnect
5 with providers of mobile telecommunications services; and
6 (3) mobile telecommunications services messages sourced to
7 this Commonwealth after December 31, 2003, and before January 1,
8 2008, based on the place of primary use standard set forth in
9 the Mobile Telecommunications Sourcing Act (4 U.S.C. § 117),
10 except gross receipts derived from:
11 (i) the sales of access to the Internet, as set forth in
12 Article II, made to the ultimate consumer; and
13 (ii) the sales for resale to persons, partnerships,
14 associations, corporations or political subdivisions subject to
15 the tax imposed by this article upon gross receipts derived from
16 such resale of mobile telecommunications services, including
17 sales of mobile telecommunications services to interconnect with
18 providers of telecommunications services.
19 (a.1) Credit.--Telegraph or telephone companies or providers
20 of mobile telecommunications services that pay a gross receipts
21 tax to another state on messages or services after December 31,
22 2003, and before January 1, 2008, which are taxable under this
23 article are entitled to a credit against the tax due under this
24 article. The credit allowed with respect to the messages or
25 services shall not exceed the tax under this article with
26 respect to the messages or services.
27 * * *
28 (j) Schedule for Estimated Payments.--
29 (1) For calendar year 2004, the following schedule applies
30 to the payment of the tax under subsection(a)(3):
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1 (i) Forty per cent of the estimated tax shall be due on
2 March 15, 2004.
3 (ii) Forty per cent of the estimated tax shall be due on
4 June 15, 2004.
5 (iii) Twenty per cent of the estimated tax shall be due on
6 September 15, 2004.
7 (2) For calendar [years after 2004] year 2007, the payment
8 of the estimated tax under subsection (a)(3) shall be due in
9 accordance with section 3003.2.
10 (3) This subsection shall expire January 1, 2008.
11 * * *
12 Section 10. Section 1704-B of the act, amended December 23,
13 2003 (P.L.250, No.46), is amended to read:
14 Section 1704-B. Carryover, Carryback, Refund and Assignment
15 of Credit.--(a) If the taxpayer, purchaser or assignee cannot
16 use the entire amount of the research and development tax credit
17 for the taxable year in which the research and development tax
18 credit is first approved, purchased or assigned, then the excess
19 may be carried over to succeeding taxable years and used as a
20 credit against the qualified tax liability of the taxpayer for
21 those taxable years. Each time that the research and development
22 tax credit is carried over to a succeeding taxable year, it is
23 to be reduced by the amount that was used as a credit during the
24 immediately preceding taxable year. The research and development
25 tax credit provided by this article may be carried over and
26 applied to succeeding taxable years for no more than fifteen
27 taxable years following the first taxable year for which the
28 taxpayer was entitled to claim the credit.
29 (b) A research and development tax credit approved by the
30 department for Pennsylvania qualified research and development
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1 expense in a taxable year first shall be applied against the
2 taxpayer's qualified tax liability for the current taxable year
3 as of the date on which the credit was approved before the
4 research and development tax credit is applied against any tax
5 liability under subsection (a).
6 (c) A taxpayer, purchaser or assignee is not entitled to
7 carry back or obtain a refund of an unused research and
8 development tax credit.
9 (d) A taxpayer, upon application to and approval by the
10 Department of Community and Economic Development, may sell or
11 assign, in whole or in part, a research and development tax
12 credit granted to the taxpayer under this article if no claim
13 for allowance of the credit is filed [within one year] from the
14 date the credit is approved by the department under section
15 1703-B. The Department of Community and Economic Development
16 shall establish guidelines for the approval of applications
17 under this subsection.
18 (e) The purchaser or assignee of a portion of a research and
19 development tax credit under subsection (d) shall immediately
20 claim the credit in the taxable year in which the purchase or
21 assignment is made. The amount of the research and development
22 credit that a purchaser or assignee may use against any one
23 qualified tax liability may not exceed seventy-five per cent of
24 such qualified tax liability for the taxable year. The purchaser
25 or assignee may not [carry over,] carry back, obtain a refund of
26 or assign the research and development tax credit. The purchaser
27 or assignee shall notify the department of the seller or
28 assignor of the research and development tax credit in
29 compliance with procedures specified by the department.
30 Section 11. Section 1707-B of the act, amended July 12, 2006
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1 (P.L.1137, No.116), is repealed:
2 [Section 1707-B. Time Limitations.--A taxpayer is not
3 entitled to a research and development tax credit for
4 Pennsylvania qualified research and development expenses
5 incurred in taxable years ending after December 31, 2015. The
6 termination date in section 41(h) of the Internal Revenue Code
7 of 1986 (Public Law 99-514, 26 U.S.C. § 41(h)) does not apply to
8 a taxpayer who is eligible for the research and development tax
9 credit under this article for the taxable year in which the
10 Pennsylvania qualified research and development expense is
11 incurred.]
12 Section 12. Section 1709-B of the act, amended or added May
13 7, 1997 (P.L.85, No.7) and July 12, 2006 (P.L.1137, No.116), is
14 repealed:
15 [Section 1709-B. Limitation on Credits.--(a) The total
16 amount of credits approved by the department shall not exceed
17 forty million dollars ($40,000,000) in any fiscal year. Of that
18 amount, eight million dollars ($8,000,000) shall be allocated
19 exclusively for small businesses. However, if the total amounts
20 allocated to either the group of applicants exclusive of small
21 businesses or the group of small business applicants is not
22 approved in any fiscal year, the unused portion will become
23 available for use by the other group of qualifying taxpayers.
24 (b) If the total amount of research and development tax
25 credits applied for by all taxpayers, exclusive of small
26 businesses, exceeds the amount allocated for those credits, then
27 the research and development tax credit to be received by each
28 applicant shall be the product of the allocated amount
29 multiplied by the quotient of the research and development tax
30 credit applied for by the applicant divided by the total of all
20070H0377B4195 - 18 -
1 research and development credits applied for by all applicants,
2 the algebraic equivalent of which is:
3 taxpayer's research and development tax credit=amount
4 allocated for those credits X (research and development
5 tax credit applied for by the applicant/total of all
6 research and development tax credits applied for by all
7 applicants).
8 (c) If the total amount of research and development tax
9 credits applied for by all small business taxpayers exceeds the
10 amount allocated for those credits, then the research and
11 development tax credit to be received by each small business
12 applicant shall be the product of the allocated amount
13 multiplied by the quotient of the research and development tax
14 credit applied for by the small business applicant divided by
15 the total of all research and development credits applied for by
16 all small business applicants, the algebraic equivalent of which
17 is:
18 taxpayer's research and development tax credit=amount
19 allocated for those credits X (research and development
20 tax credit applied for by the small business/total of all
21 research and development tax credits applied for by all
22 small business applicants).]
23 Section 13. Section 1712-B of the act, amended July 12, 2006
24 (P.L.1137, No.116), is repealed:
25 [Section 1712-B. Termination.--The department shall not
26 approve a research and development tax credit under this article
27 for taxable years ending after December 31, 2015.]
28 Section 14. The act is amended by adding articles to read:
29 ARTICLE XVII-F
30 SMALL BUSINESS HEALTH SAVINGS ACCOUNT TAX CREDIT
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1 Section 1701-F. Scope.
2 This article relates to small business health savings account
3 tax credit.
4 Section 1702-F. Definitions.
5 The following words and phrases when used in this article
6 shall have the meanings given to them in this section unless the
7 context clearly indicates otherwise:
8 "Department." The Department of Revenue of the Commonwealth.
9 "Employee" or "employees." An individual or group of
10 individuals employed by a small business. The term shall also
11 include a sole proprietor.
12 "Health insurance policy." An individual or group health,
13 sickness or accident policy or subscriber contract or
14 certificate issued by an entity subject to any one of the
15 following:
16 (1) The act of May 17, 1921 (P.L.682, No.284), known as
17 The Insurance Company Law of 1921.
18 (2) The act of December 29, 1972 (P.L.1701, No.364),
19 known as the Health Maintenance Organization Act.
20 (3) The act of May 18, 1976 (P.L.123, No.54), known as
21 the Individual Accident and Sickness Insurance Minimum
22 Standards Act.
23 (4) 40 Pa.C.S. Ch. 61 (relating to hospital plan
24 corporations) or 63 (relating to professional health services
25 plan corporations).
26 "Health Savings Account." As defined in section 223(d) of
27 the Internal Revenue Code of 1986 (Public Law 99-514, 26 U.S.C.
28 § 223(d)).
29 "Pass-through entity." Any of the following:
30 (1) A partnership, limited partnership, limited
20070H0377B4195 - 20 -
1 liability company, business trust or other unincorporated
2 entity that for Federal income tax purposes is taxable as a
3 partnership.
4 (2) A Pennsylvania S corporation.
5 "Qualified high deductible health plan." A health insurance
6 policy that would qualify as a high deductible health plan under
7 section 223(c)(2) of the Internal Revenue Code of 1986 (Public
8 Law 99-514, 26 U.S.C. § 223(c)(2)).
9 "Qualified tax liability." The liability for taxes imposed
10 under Article III, IV or VI. The term shall include the
11 liability for taxes imposed under Article III on an owner of a
12 pass-through entity.
13 "Secretary." The Secretary of Revenue of the Commonwealth.
14 "Small business." An employer who, on at least 50% of its
15 working days during the taxable year, employed fewer than 100
16 employees.
17 "Tax credit." The small business health savings account tax
18 credit authorized under this article.
19 "Taxpayer." A small business subject to tax under Article
20 III, IV or VI. The term includes:
21 (1) the partner, shareholder, owner or member of a pass-
22 through entity; or
23 (2) a sole proprietor.
24 Section 1703-F. Credit for Health Savings Account
25 contributions.
26 (a) Application.--A taxpayer who purchases and provides a
27 qualified high deductible health insurance policy to employees
28 and makes a contribution to a health savings account on behalf
29 of employees in a taxable year may apply for a tax credit as
30 provided in this article. By September 15, a taxpayer must
20070H0377B4195 - 21 -
1 submit an application to the department for the aggregate
2 contribution made by the taxpayer to employee health savings
3 accounts in the taxable year that ended in the prior calendar
4 year.
5 (b) Computation.--A taxpayer who qualifies under subsection
6 (a) shall receive a tax credit for the taxable year in
7 accordance with the following:
8 (1) Fifty percent of the aggregate contribution made by
9 the taxpayer to employee health savings accounts when the
10 contribution is provided for the benefit of employees,
11 spouses and dependents for the taxable year.
12 (2) Twenty-five percent of the aggregate contribution
13 made by the taxpayer to employee health savings accounts when
14 the contribution is provided solely for the benefit of an
15 employee.
16 (c) Notification.--By December 15 of the calendar year
17 following the close of the taxable year during which the
18 contribution to employee health savings accounts was made, the
19 department shall notify the taxpayer of the amount of the
20 taxpayer's tax credit approved by the department.
21 Section 1704-F. Limitation on credits.
22 (a) Limit.--The total amount of credits approved by the
23 department shall not exceed $30,000,000 in any fiscal year.
24 (b) Calculation.--If the total amount of small business
25 health savings account tax credits applied for by all taxpayers
26 exceeds the amount allocated for those credits, then the small
27 business health savings account tax credit to be received by
28 each applicant shall be the product of the allocated amount
29 multiplied by the quotient of the small business health savings
30 account tax credit applied for by the applicant divided by the
20070H0377B4195 - 22 -
1 total of all small business health savings account credits
2 applied for by all applicants, the algebraic equivalent of which
3 is:
4 taxpayer's small business health savings account tax
5 credit=amount allocated for those credits X (small
6 business health savings account tax credit applied for by
7 the applicant/total of all small business health savings
8 account tax credits applied for by all applicants).
9 Section 1705-F. Carryover, carryback, refund and assignment of
10 credit.
11 (a) Carryover.--If the taxpayer cannot use the entire amount
12 of the tax credit for the taxable year in which the tax credit
13 is first approved, then the excess may be carried over to
14 succeeding taxable years and used as a credit against the
15 qualified tax liability of the taxpayer for those taxable years.
16 Each time that the tax credit is carried over to a succeeding
17 taxable year, it is to be reduced by the amount that was used as
18 a credit during the immediately preceding taxable year. The tax
19 credit may be carried over and applied to succeeding taxable
20 years for no more than 15 taxable years following the first
21 taxable year for which the taxpayer was entitled to claim the
22 credit.
23 (b) Application of credit.--A tax credit approved by the
24 department for monetary contributions made to employee health
25 savings accounts in a taxable year first shall be applied
26 against the taxpayer's qualified tax liability for the current
27 taxable year as of the date on which the credit was approved
28 before the tax credit is applied against any tax liability under
29 subsection (a).
30 (c) Prohibition.--A taxpayer is not entitled to assign,
20070H0377B4195 - 23 -
1 carry back or obtain a refund of an unused tax credit.
2 Section 1706-F. Shareholder, owner or member pass-through.
3 (a) Shareholder's calculation.--If a Pennsylvania S
4 corporation does not have an eligible tax liability against
5 which the tax credit may be applied, a shareholder of the
6 Pennsylvania S corporation is entitled to a tax credit equal to
7 the tax credit determined for the Pennsylvania S corporation for
8 the taxable year multiplied by the percentage of the
9 Pennsylvania S corporation's distributive income to which the
10 shareholder is entitled.
11 (b) Owner or member calculation.--If a pass-through entity
12 other than a Pennsylvania S corporation does not have an
13 eligible tax liability against which the tax credit may be
14 applied, an owner or member of the pass-through entity is
15 entitled to a tax credit equal to the tax credit determined for
16 the pass-through entity for the taxable year multiplied by the
17 percentage of the pass-through entity's distributive income to
18 which the owner or member is entitled.
19 (c) Application; restrictions.--The credit provided under
20 subsection (a) or (b) is in addition to any tax credit to which
21 a shareholder, owner or member of a pass-through entity is
22 otherwise entitled under this article. However, a pass-through
23 entity and a shareholder, owner or member of a pass-through
24 entity may not claim a credit under this article for the same
25 contributions made to employee health savings accounts.
26 Section 1707-F. Report to General Assembly.
27 The secretary shall submit an annual report to the General
28 Assembly indicating the effectiveness of the credit provided by
29 this article no later than March 15 following the year in which
30 the credits were approved. The report shall include the names of
20070H0377B4195 - 24 -
1 all taxpayers utilizing the credit as of the date of the report
2 and the amount of credits approved and utilized by each
3 taxpayer. Notwithstanding any law providing for the
4 confidentiality of tax records, the information contained in the
5 report shall be public information. The report may also include
6 any recommendations for changes in the calculation or
7 administration of the credit.
8 Section 1708-F. Regulations.
9 The secretary shall promulgate regulations necessary for the
10 implementation and administration of this article.
11 ARTICLE XVII-G
12 NEW DIESEL TECHNOLOGY TAX CREDIT
13 Section 1701-G. Scope of article.
14 This article relates to new diesel technology tax credits.
15 Section 1702-G. Definitions.
16 The following words and phrases when used in this article
17 shall have the meanings given to them in this section unless the
18 context clearly indicates otherwise:
19 "Department." The Department of Revenue of the Commonwealth.
20 "Pass-through entity." Any of the following:
21 (1) A partnership, limited partnership, limited
22 liability company, business trust or other unincorporated
23 entity that for Federal income tax purposes is taxable as a
24 partnership.
25 (2) A Pennsylvania S corporation.
26 "Qualified new diesel technology expenses." The cost
27 incurred for the purchase of a Class 8 highway vehicle with a
28 registered gross or combination weight as provided under 75
29 Pa.C.S. § 1916 (relating to trucks and truck tractors) and with
30 a diesel engine if the vehicle purchased has been certified as
20070H0377B4195 - 25 -
1 compliant with the emissions limits contained in 40 CFR 86.007-
2 11 (relating to emission standards and supplemental requirements
3 for 2007 and later model year diesel heavy-duty engines and
4 vehicles), except that 40 CFR 86.007-15 (relating to NOX and
5 particulate averaging, trading, and banking for heavy-duty
6 engines), shall not apply to exhaust emissions attainment levels
7 for particulates.
8 "Qualified tax liability." The liability for taxes imposed
9 under Article III, IV or VI. The term shall include the
10 liability for taxes imposed under Article III on an owner of a
11 pass-through entity.
12 "Secretary." The Secretary of Revenue of the Commonwealth.
13 "Tax credit." The new diesel technology tax credit
14 authorized under this article.
15 "Taxpayer." An entity subject to tax under Article III, IV
16 or VI. The term shall include the shareholder, owner or member
17 of a pass-through entity that receives a tax credit.
18 Section 1703-G. Credit for new diesel technology.
19 (a) Application.--A taxpayer who incurs a qualified new
20 diesel technology expense in a taxable year may apply for a tax
21 credit as provided in this article. By September 15, a taxpayer
22 must submit an application to the department for qualified new
23 diesel technology expenses incurred in the taxable year that
24 ended in the prior calendar year.
25 (b) Amount.--A taxpayer that is qualified under subsection
26 (a) shall receive a tax credit for the taxable year in the
27 amount of $5,000 per qualified new diesel technology expense.
28 (c) Notification.--By December 15 of the calendar year
29 following the close of the taxable year during which qualified
30 new diesel technology expense was incurred, the department shall
20070H0377B4195 - 26 -
1 notify the taxpayer of the amount of the taxpayer's tax credit
2 approved by the department.
3 Section 1704-G. Carryover, carryback, refund and assignment of
4 credit.
5 (a) Carryover.--If the taxpayer cannot use the entire amount
6 of the tax credit for the taxable year in which the tax credit
7 is first approved, the excess may be carried over to succeeding
8 taxable years and used as a credit against the qualified tax
9 liability of the taxpayer for those taxable years. Each time
10 that the tax credit is carried over to a succeeding taxable
11 year, it shall be reduced by the amount that was used as a
12 credit during the immediately preceding taxable year. The tax
13 credit may be carried over and applied to succeeding taxable
14 years for no more than 15 taxable years following the first
15 taxable year for which the taxpayer was entitled to claim the
16 credit.
17 (b) Application.--A tax credit approved by the department
18 for qualified new diesel technology expenses in a taxable year
19 first shall be applied against the taxpayer's qualified tax
20 liability for the current taxable year as of the date on which
21 the credit was approved before the tax credit is applied against
22 any tax liability under subsection (a).
23 (c) Unused credit.--A taxpayer is not entitled to assign,
24 carry back or obtain a refund of an unused tax credit.
25 Section 1705-G. Time limitations.
26 A taxpayer is not entitled to a tax credit for qualified new
27 diesel technology expenses incurred in taxable years ending
28 after December 31, 2009.
29 Section 1706-G. Shareholder, owner or member pass-through.
30 (a) Pennsylvania S corporations.--If a Pennsylvania S
20070H0377B4195 - 27 -
1 corporation does not have an eligible tax liability against
2 which the tax credit may be applied, a shareholder of the
3 Pennsylvania S corporation is entitled to a tax credit equal to
4 the tax credit determined for the Pennsylvania S corporation for
5 the taxable year multiplied by the percentage of the
6 Pennsylvania S corporation's distributive income to which the
7 shareholder is entitled under this article.
8 (b) Pass-through entities.--If a pass-through entity other
9 than a Pennsylvania S corporation does not have an eligible tax
10 liability against which the tax credit may be applied, an owner
11 or member of the pass-through entity is entitled to a tax credit
12 equal to the tax credit determined for the pass-through entity
13 for the taxable year multiplied by the percentage of the pass-
14 through entity's distributive income to which the owner or
15 member is entitled under this article.
16 (c) Additional credits.--The credit provided under
17 subsection (a) or (b) shall be in addition to any tax credit to
18 which a shareholder, owner or member of a pass-through entity is
19 otherwise entitled under this article. However, a pass-through
20 entity and a shareholder, owner or member of a pass-through
21 entity may not claim a credit under this article for the same
22 qualified new diesel technology expense.
23 Section 1707-G. Report to General Assembly.
24 The secretary shall submit an annual report to the General
25 Assembly indicating the effectiveness of the credit provided by
26 this article no later than March 15 following the year in which
27 the credits were approved. The report shall include the names of
28 all taxpayers utilizing the credit as of the date of the report
29 and the amount of credits approved and utilized by each
30 taxpayer. Notwithstanding any law providing for the
20070H0377B4195 - 28 -
1 confidentiality of tax records, the information contained in the
2 report shall be public information. The report may also include
3 any recommendations for changes in the calculation or
4 administration of the credit.
5 Section 1708-G. Termination.
6 The department shall not approve a tax credit under this
7 article for taxable years ending after December 31, 2009.
8 Section 1709-G. Regulations.
9 The secretary shall promulgate regulations necessary for the
10 implementation and administration of this article.
11 Section 15. Section 2106 of the act, added August 4, 1991
12 (P.L.97, No.22), is amended to read:
13 Section 2106. Imposition of Tax.--(a) An inheritance tax
14 for the use of the Commonwealth is imposed upon every transfer
15 subject to tax under this article at the rates specified in
16 section 2116.
17 (b) This section shall not apply to the estates of decedents
18 dying on or after January 1, 2012.
19 Section 16. Section 2116(a) of the act, amended May 24, 2000
20 (P.L.106, No.23), is amended to read:
21 Section 2116. Inheritance Tax.--(a) (1) Inheritance tax
22 upon the transfer of property passing to or for the use of [any
23 of the following shall be at the rate of four and one-half per
24 cent:
25 (i) grandfather, grandmother, father, mother, except
26 transfers under subclause (1.2), and lineal descendants; or
27 (ii) wife or widow and husband or widower of a child.] a
28 grandfather, grandmother, father, mother, except transfers under
29 subclause (1.2), lineal descendants, wife or widow and husband
30 or widower of a child shall be at the rate provided in the
20070H0377B4195 - 29 -
1 following schedule:
2 (i) Four and one-half per cent for the estate of a decedent
3 dying before or during calendar year 2009.
4 (ii) Two per cent for the estate of a decedent dying during
5 calendar year 2010.
6 (iii) Zero per cent for the estate of a decedent dying
7 during or after calendar year 2011.
8 (1.1) Inheritance tax upon the transfer of property passing
9 to or for the use of a husband or wife shall be:
10 (i) At the rate of three per cent for estates of decedents
11 dying on or after July 1, 1994, and before January 1, 1995.
12 (ii) At a rate of zero per cent for estates of decedents
13 dying on or after January 1, 1995.
14 (1.2) Inheritance tax upon the transfer of property from a
15 child twenty-one years of age or younger to or for the use of a
16 natural parent, an adoptive parent or a stepparent of the child
17 shall be at the rate of zero per cent.
18 (1.3) Inheritance tax upon the transfer of property passing
19 to or for the use of a sibling shall be at the rate [of twelve
20 per cent.] provided in the following schedule:
21 (i) Twelve per cent for the estate of a decedent dying
22 before or during calendar year 2007.
23 (ii) Nine per cent for the estate of a decedent dying during
24 calendar year 2008.
25 (iii) Six per cent for the estate of a decedent dying during
26 calendar year 2009.
27 (iv) Four and one-half per cent for the estate of a decedent
28 dying during calendar year 2010.
29 (v) Two per cent for the estate of a decedent dying during
30 calendar year 2011.
20070H0377B4195 - 30 -
1 (vi) Zero per cent for the estate of a decedent dying during
2 or after calendar year 2012.
3 (1.4) Inheritance tax upon the transfer of property that is
4 jointly held between a child and a natural parent, an adoptive
5 parent or a stepparent of the child to the natural parent,
6 adoptive parent or the stepparent shall be at the rate of zero
7 per cent.
8 (2) Inheritance tax upon the transfer of property passing to
9 or for the use of all persons other than those designated in
10 subclause (1), (1.1), (1.2) or (1.3) or exempt under section
11 2111(m) shall be at the rate [of fifteen per cent.] provided in
12 the following schedule:
13 (i) Fifteen per cent for the estate of a decedent dying
14 before or during calendar year 2007.
15 (ii) Ten per cent for the estate of a decedent dying during
16 calendar year 2008.
17 (iii) Seven per cent for the estate of a decedent dying
18 during calendar year 2009.
19 (iv) Four and one-half per cent for the estate of a decedent
20 dying during calendar year 2010.
21 (v) Two per cent for the estate of a decedent dying during
22 calendar year 2011.
23 (vi) Zero per cent for the estate of a decedent dying during
24 or after calendar year 2012.
25 (3) When property passes to or for the use of a husband and
26 wife with right of survivorship, one of whom is taxable at a
27 rate lower than the other, the lower rate of tax shall be
28 applied to the entire interest.
29 * * *
30 Section 17. Section 2117 of the act is amended by adding a
20070H0377B4195 - 31 -
1 subsection to read:
2 Section 2117. Estate Tax.--* * *
3 (d) This section shall not apply to the estates of decedents
4 dying on or after January 1, 2012.
5 Section 18. Repeals are as follows:
6 (1) The General Assembly declares that the repeal under
7 paragraph (2) is necessary to effectuate the purposes of this
8 act.
9 (2) Section 33(12) of the act of December 23, 2003
10 (P.L.250, No.46), entitled "An act amending the act of March
11 4, 1971 (P.L.6, No.2), entitled 'An act relating to tax
12 reform and State taxation by codifying and enumerating
13 certain subjects of taxation and imposing taxes thereon;
14 providing procedures for the payment, collection,
15 administration and enforcement thereof; providing for tax
16 credits in certain cases; conferring powers and imposing
17 duties upon the Department of Revenue, certain employers,
18 fiduciaries, individuals, persons, corporations and other
19 entities; prescribing crimes, offenses and penalties,'
20 further providing, in sales and use tax, for definitions, for
21 exclusions, for credits, for licenses and for transfers to
22 Public Transportation Assistance Fund; further providing, in
23 personal income tax, for definitions, for imposition, for
24 special tax provisions for poverty, for returns and liability
25 and for returns and records; further providing, in corporate
26 net income tax, for definitions and for interests in
27 unincorporated entities; providing, in corporate net income
28 tax, for additional withholding requirements; further
29 providing, in capital stock franchise tax, for definitions
30 and reports, for imposition and for expiration; further
20070H0377B4195 - 32 -
1 providing, in utilities gross receipts tax, for imposition;
2 further providing, in public utility realty tax, for
3 surcharges; providing, in public utility realty tax, for
4 additional tax; further providing, in cigarette tax, for
5 incidence and rate of tax, for floor tax, for stamp to
6 evidence the tax and for commissions on sales; establishing,
7 in relation to cigarette tax, the Health Care Provider
8 Retention Account; further providing, in research and
9 development tax credit, for carryover, for limitations and
10 for reports; further providing, in malt beverage tax, for
11 limited tax credits; further providing, in inheritance tax,
12 for definitions, for exempt transfers, for estate tax and for
13 estate tax returns; further providing for the Public
14 Transportation Assistance Fund and providing for its
15 administration; further providing for estimated tax and for
16 underpayment of estimated tax; providing for authority to
17 attach wages; and repealing provisions relating to the Public
18 Transportation Assistance Fund," is repealed.
19 Section 19. The following provisions shall apply to taxable
20 years beginning after December 31, 2007:
21 (1) The amendment of 316 of the act.
22 (2) The amendment of section 401(3)4(c) of the act.
23 (3) The amendment of section 601(a) of the act.
24 (4) The amendment of section 1704-B of the act.
25 (5) The addition of Article XVII-F of the act.
26 Section 20. This act shall take effect as follows:
27 (1) The following provisions shall take effect July 1,
28 2008:
29 (i) The amendment of section 201(m) of the act.
30 (ii) The amendment or addition of section 204(10),
20070H0377B4195 - 33 -
1 (67) and (68) of the act.
2 (iii) The addition of section 304.1 of the act.
3 (iv) The amendment of section 1101(a), (a.1) and (j)
4 of the act.
5 (v) The repeal of section 1707-B of the act.
6 (vi) The repeal of section 1709-B of the act.
7 (vii) The repeal of section 1712-B of the act.
8 (v) The addition of Article XVII-F of the act.
9 (vi) The addition of Article XVII-G of the act.
10 (vii) Section 18 of this act.
11 (2) The following provisions shall take effect July 1,
12 2008, or immediately, whichever is later:
13 (i) The amendment of section 302 of the act.
14 (ii) The amendment of section 316 of the act.
15 (iii) The amendment of section 401(3)2(a)(9) of the
16 act.
17 (iv) The amendment of section 402(b) of the act.
18 (3) The remainder of this act shall take effect
19 immediately.
20 SECTION 1. SECTION 303(A.3) OF THE ACT OF MARCH 4, 1971 <--
21 (P.L.6, NO.2), KNOWN AS THE TAX REFORM CODE OF 1971, ADDED JUNE
22 29, 2002 (P.L.559, NO.89), IS AMENDED TO READ:
23 SECTION 303. CLASSES OF INCOME.--* * *
24 (A.3) THE COST OF PROPERTY COMMONLY REFERRED TO AS SECTION
25 179 PROPERTY MAY BE TREATED AS A DEDUCTIBLE EXPENSE ONLY TO THE
26 EXTENT ALLOWABLE UNDER THE VERSION OF SECTION 179 OF THE
27 INTERNAL REVENUE CODE IN EFFECT AT THE TIME THE PROPERTY IS
28 PLACED IN SERVICE [OR UNDER SECTION 179 OF THE INTERNAL REVENUE
29 CODE OF 1986 (26 U.S.C. § 179), WHICHEVER IS EARLIER]. THE LIMIT
30 ON SECTION 179 PROPERTY WHICH MAY BE TREATED AS DEDUCTIBLE SHALL
20070H0377B4195 - 34 -
1 BE FIFTY THOUSAND DOLLARS ($50,000). THE BASIS OF SECTION 179
2 PROPERTY SHALL BE REDUCED, BUT NOT BELOW ZERO, FOR COSTS TREATED
3 AS A DEDUCTIBLE EXPENSE. THE AMOUNT OF THE REDUCTION SHALL BE
4 THE AMOUNT DEDUCTED ON A RETURN AND NOT DISALLOWED, REGARDLESS
5 OF WHETHER THE DEDUCTION RESULTS IN A REDUCTION OF INCOME.
6 * * *
7 SECTION 2. SECTION 304 OF THE ACT, AMENDED DECEMBER 13, 1991
8 (P.L.373, NO.40) AND DECEMBER 23, 2003 (P.L.250, NO.46), IS
9 AMENDED TO READ:
10 SECTION 304. SPECIAL TAX PROVISIONS FOR POVERTY.--(A) THE
11 GENERAL ASSEMBLY, IN RECOGNITION OF THE POWERS CONTAINED IN
12 SECTION 2(B)(II) OF ARTICLE VIII OF THE CONSTITUTION OF THE
13 COMMONWEALTH OF PENNSYLVANIA WHICH PROVIDES THEREIN FOR THE
14 ESTABLISHING AS A CLASS OR CLASSES OF SUBJECTS OF TAXATION THE
15 PROPERTY OR PRIVILEGES OF PERSONS WHO, BECAUSE OF POVERTY ARE
16 DETERMINED TO BE IN NEED OF SPECIAL TAX PROVISIONS HEREBY
17 DECLARES AS ITS LEGISLATIVE INTENT AND PURPOSE TO IMPLEMENT SUCH
18 POWER UNDER SUCH CONSTITUTIONAL PROVISION BY ESTABLISHING
19 SPECIAL TAX PROVISIONS AS HEREINAFTER PROVIDED IN THIS ACT.
20 (B) THE GENERAL ASSEMBLY HAVING DETERMINED THAT THERE ARE
21 PERSONS WITHIN THIS COMMONWEALTH WHOSE INCOMES ARE SUCH THAT
22 IMPOSITION OF A TAX THEREON WOULD DEPRIVE THEM AND THEIR
23 DEPENDENTS OF THE BARE NECESSITIES OF LIFE AND HAVING FURTHER
24 DETERMINED THAT POVERTY IS A RELATIVE CONCEPT INEXTRICABLY
25 JOINED WITH ACTUAL INCOME AND THE NUMBER OF PEOPLE DEPENDENT
26 UPON SUCH INCOME DEEMS IT TO BE A MATTER OF PUBLIC POLICY TO
27 PROVIDE SPECIAL TAX PROVISIONS FOR THAT CLASS OF PERSONS
28 HEREINAFTER DESIGNATED TO RELIEVE THEIR ECONOMIC BURDEN.
29 (C) FOR THE TAXABLE YEAR 1974 AND EACH YEAR THEREAFTER ANY
30 CLAIMANT WHO MEETS THE FOLLOWING STANDARDS OF ELIGIBILITY
20070H0377B4195 - 35 -
1 ESTABLISHED BY THIS ACT AS THE TEST FOR POVERTY SHALL BE DEEMED
2 A SEPARATE CLASS OF SUBJECT OF TAXATION, AND, AS SUCH, SHALL BE
3 ENTITLED TO THE BENEFIT OF THE SPECIAL PROVISIONS OF THIS ACT.
4 (D) ANY CLAIM FOR SPECIAL TAX PROVISIONS HEREUNDER SHALL BE
5 DETERMINED IN ACCORDANCE WITH THE FOLLOWING:
6 (1) IF THE POVERTY INCOME OF THE CLAIMANT DURING AN ENTIRE
7 TAXABLE YEAR IS [SIX THOUSAND FIVE HUNDRED DOLLARS ($6,500) OR
8 LESS, OR, IN THE CASE OF A MARRIED CLAIMANT, IF THE JOINT
9 POVERTY INCOME OF THE CLAIMANT AND THE CLAIMANT'S SPOUSE DURING
10 AN ENTIRE TAXABLE YEAR IS THIRTEEN THOUSAND DOLLARS ($13,000) OR
11 LESS] THE AMOUNT UNDER CLAUSE (1.1)(I), THE CLAIMANT SHALL BE
12 ENTITLED TO A REFUND OR FORGIVENESS OF ANY MONEYS WHICH HAVE
13 BEEN PAID OVER TO (OR WOULD EXCEPT FOR THE PROVISIONS OF THIS
14 ACT BE PAYABLE TO) THE COMMONWEALTH UNDER THE PROVISIONS OF THIS
15 ARTICLE, WITH AN ADDITIONAL INCOME ALLOWANCE OF [NINE THOUSAND
16 FIVE HUNDRED DOLLARS ($9,500)] THE AMOUNT UNDER CLAUSE (1.1)(II)
17 FOR EACH DEPENDENT OF THE CLAIMANT. FOR PURPOSES OF THIS
18 SUBSECTION, A CLAIMANT SHALL NOT BE CONSIDERED TO BE MARRIED IF:
19 (I) THE CLAIMANT AND THE CLAIMANT'S SPOUSE FILE SEPARATE
20 RETURNS; AND
21 (II) THE CLAIMANT AND THE CLAIMANT'S SPOUSE LIVE APART AT
22 ALL TIMES DURING THE LAST SIX MONTHS OF THE TAXABLE YEAR OR ARE
23 SEPARATED PURSUANT TO A WRITTEN SEPARATION AGREEMENT.
24 (1.1) (I) THE AMOUNT OF POVERTY INCOME OF A CLAIMANT DURING
25 AN ENTIRE TAXABLE YEAR UNDER CLAUSE (1) SHALL BE AS FOLLOWS:
26 (A) FOR TAXABLE YEARS ENDING BEFORE JANUARY 1, 2008, THE
27 AMOUNT SHALL BE SIX THOUSAND FIVE HUNDRED DOLLARS ($6,500) OR
28 LESS, OR, IN THE CASE OF A MARRIED CLAIMANT, THE AMOUNT SHALL BE
29 THIRTEEN THOUSAND DOLLARS ($13,000) OR LESS.
30 (B) FOR TAXABLE YEARS ENDING AFTER DECEMBER 31, 2007, AND
20070H0377B4195 - 36 -
1 BEFORE JANUARY 1, 2009, THE AMOUNT SHALL BE SEVEN THOUSAND FIVE
2 HUNDRED DOLLARS ($7,500) OR LESS, OR, IN THE CASE OF A MARRIED
3 CLAIMANT, THE AMOUNT SHALL BE FIFTEEN THOUSAND DOLLARS ($15,000)
4 OR LESS.
5 (C) FOR TAXABLE YEARS ENDING AFTER DECEMBER 31, 2008, AND
6 BEFORE JANUARY 1, 2010, THE AMOUNT SHALL BE EIGHT THOUSAND
7 DOLLARS ($8,000) OR LESS, OR, IN THE CASE OF A MARRIED CLAIMANT,
8 THE AMOUNT SHALL BE SIXTEEN THOUSAND DOLLARS ($16,000) OR LESS.
9 (D) FOR TAXABLE YEARS ENDING AFTER DECEMBER 31, 2009, THE
10 AMOUNT SHALL BE EIGHT THOUSAND FIVE HUNDRED DOLLARS ($8,500) OR
11 LESS, OR, IN THE CASE OF A MARRIED CLAIMANT, THE AMOUNT SHALL BE
12 SEVENTEEN THOUSAND DOLLARS ($17,000) OR LESS.
13 (II) THE ADDITIONAL INCOME ALLOWANCE FOR EACH DEPENDENT OF A
14 CLAIMANT UNDER CLAUSE (1) SHALL BE AS FOLLOWS:
15 (A) FOR TAXABLE YEARS ENDING BEFORE JANUARY 1, 2009, THE
16 AMOUNT SHALL BE NINE THOUSAND FIVE HUNDRED DOLLARS ($9,500).
17 (B) FOR TAXABLE YEARS ENDING AFTER DECEMBER 31, 2008, AND
18 BEFORE JANUARY 1, 2010, THE AMOUNT SHALL BE NINE THOUSAND SEVEN
19 HUNDRED AND FIFTY DOLLARS ($9,750).
20 (C) FOR TAXABLE YEARS ENDING AFTER DECEMBER 31, 2009, THE
21 AMOUNT SHALL BE TEN THOUSAND DOLLARS ($10,000).
22 (2) IF THE POVERTY INCOME OF THE CLAIMANT DURING AN ENTIRE
23 TAXABLE YEAR DOES NOT EXCEED THE POVERTY INCOME LIMITATIONS
24 PRESCRIBED BY CLAUSE (1) BY MORE THAN THE DOLLAR CATEGORY
25 CONTAINED IN SUBCLAUSES (I), (II), (III), (IV), (V), (VI),
26 (VII), (VIII) OR (IX) OF THIS CLAUSE, THE CLAIMANT SHALL BE
27 ENTITLED TO A REFUND OR FORGIVENESS BASED ON THE PER CENTAGE
28 PRESCRIBED IN SUCH SUBCLAUSES OF ANY MONEYS WHICH HAVE BEEN PAID
29 OVER TO (OR WOULD HAVE BEEN EXCEPT FOR THE PROVISIONS HEREIN BE
30 PAYABLE TO) THE COMMONWEALTH UNDER THIS ARTICLE:
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1 (I) NINETY PER CENT IF NOT IN EXCESS OF TWO HUNDRED FIFTY
2 DOLLARS ($250).
3 (II) EIGHTY PER CENT IF NOT IN EXCESS OF FIVE HUNDRED
4 DOLLARS ($500).
5 (III) SEVENTY PER CENT IF NOT IN EXCESS OF SEVEN HUNDRED
6 FIFTY DOLLARS ($750).
7 (IV) SIXTY PER CENT IF NOT IN EXCESS OF ONE THOUSAND DOLLARS
8 ($1,000).
9 (V) FIFTY PER CENT IF NOT IN EXCESS OF ONE THOUSAND TWO
10 HUNDRED FIFTY DOLLARS ($1,250).
11 (VI) FORTY PER CENT IF NOT IN EXCESS OF ONE THOUSAND FIVE
12 HUNDRED DOLLARS ($1,500).
13 (VII) THIRTY PER CENT IF NOT IN EXCESS OF ONE THOUSAND SEVEN
14 HUNDRED FIFTY DOLLARS ($1,750).
15 (VIII) TWENTY PER CENT IF NOT IN EXCESS OF TWO THOUSAND
16 DOLLARS ($2,000).
17 (IX) TEN PER CENT IF NOT IN EXCESS OF TWO THOUSAND TWO
18 HUNDRED FIFTY DOLLARS ($2,250).
19 (3) IF AN INDIVIDUAL HAS A TAXABLE YEAR OF LESS THAN TWELVE
20 MONTHS, THE POVERTY INCOME THEREOF SHALL BE ANNUALIZED IN SUCH
21 MANNER AS THE DEPARTMENT MAY PRESCRIBE.
22 SECTION 3. SECTION 401(3)2(A)(9) AND 4(C) OF THE ACT,
23 AMENDED JULY 12, 2006 (P.L.1137, NO.116), ARE AMENDED TO READ:
24 SECTION 401. DEFINITIONS.--THE FOLLOWING WORDS, TERMS, AND
25 PHRASES, WHEN USED IN THIS ARTICLE, SHALL HAVE THE MEANING
26 ASCRIBED TO THEM IN THIS SECTION, EXCEPT WHERE THE CONTEXT
27 CLEARLY INDICATES A DIFFERENT MEANING:
28 * * *
29 (3) "TAXABLE INCOME." * * *
30 2. IN CASE THE ENTIRE BUSINESS OF ANY CORPORATION, OTHER
20070H0377B4195 - 38 -
1 THAN A CORPORATION ENGAGED IN DOING BUSINESS AS A REGULATED
2 INVESTMENT COMPANY AS DEFINED BY THE INTERNAL REVENUE CODE OF
3 1986, IS NOT TRANSACTED WITHIN THIS COMMONWEALTH, THE TAX
4 IMPOSED BY THIS ARTICLE SHALL BE BASED UPON SUCH PORTION OF THE
5 TAXABLE INCOME OF SUCH CORPORATION FOR THE FISCAL OR CALENDAR
6 YEAR, AS DEFINED IN SUBCLAUSE 1 HEREOF, AND MAY BE DETERMINED AS
7 FOLLOWS:
8 (A) DIVISION OF INCOME.
9 * * *
10 (9) (A) EXCEPT AS PROVIDED IN SUBPARAGRAPH (B):
11 (I) FOR TAXABLE YEARS BEGINNING BEFORE JANUARY 1, 2007, ALL
12 BUSINESS INCOME SHALL BE APPORTIONED TO THIS STATE BY
13 MULTIPLYING THE INCOME BY A FRACTION, THE NUMERATOR OF WHICH IS
14 THE PROPERTY FACTOR PLUS THE PAYROLL FACTOR PLUS THREE TIMES THE
15 SALES FACTOR AND THE DENOMINATOR OF WHICH IS FIVE.
16 (II) FOR TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2006,
17 ALL BUSINESS INCOME SHALL BE APPORTIONED TO THIS STATE BY
18 MULTIPLYING THE INCOME BY A FRACTION, THE NUMERATOR OF WHICH IS
19 THE SUM OF FIFTEEN TIMES THE PROPERTY FACTOR, FIFTEEN TIMES THE
20 PAYROLL FACTOR AND SEVENTY TIMES THE SALES FACTOR AND THE
21 DENOMINATOR OF WHICH IS ONE HUNDRED.
22 (III) FOR TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2008,
23 ALL BUSINESS INCOME SHALL BE APPORTIONED TO THIS STATE BY
24 MULTIPLYING THE INCOME BY A FRACTION: THE NUMERATOR OF WHICH IS
25 THE SUM OF SEVEN AND A HALF TIMES THE PROPERTY FACTOR, SEVEN AND
26 A HALF TIMES THE PAYROLL FACTOR AND EIGHTY-FIVE TIMES THE SALES
27 FACTOR; AND THE DENOMINATOR OF WHICH IS ONE HUNDRED.
28 (B) FOR PURPOSES OF APPORTIONMENT OF THE CAPITAL STOCK -
29 FRANCHISE TAX AS PROVIDED IN SECTION 602 OF ARTICLE VI OF THIS
30 ACT, THE APPORTIONMENT FRACTION SHALL BE THE PROPERTY FACTOR
20070H0377B4195 - 39 -
1 PLUS THE PAYROLL FACTOR PLUS THE SALES FACTOR AS THE NUMERATOR,
2 AND THE DENOMINATOR SHALL BE THREE.
3 * * *
4 4. * * *
5 (C) (1) THE NET LOSS DEDUCTION SHALL BE THE LESSER OF:
6 (A) (I) FOR TAXABLE YEARS BEGINNING BEFORE JANUARY 1, 2007,
7 TWO MILLION DOLLARS ($2,000,000);
8 (II) FOR TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2006,
9 THE GREATER OF TWELVE AND ONE-HALF PER CENT OF TAXABLE INCOME AS
10 DETERMINED UNDER SUBCLAUSE 1 OR, IF APPLICABLE, SUBCLAUSE 2 OR
11 THREE MILLION DOLLARS ($3,000,000); [OR]
12 (III) FOR TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2008,
13 THE GREATER OF TWENTY PER CENT OF THE TAXABLE INCOME AS
14 DETERMINED UNDER SUBCLAUSE 1 OR, IF APPLICABLE, SUBCLAUSE 2 OR
15 FIVE MILLION DOLLARS ($5,000,000); OR
16 (B) THE AMOUNT OF THE NET LOSS OR LOSSES WHICH MAY BE
17 CARRIED OVER TO THE TAXABLE YEAR OR TAXABLE INCOME AS DETERMINED
18 UNDER SUBCLAUSE 1 OR, IF APPLICABLE, SUBCLAUSE 2.
19 (1.1) IN NO EVENT SHALL THE NET LOSS DEDUCTION INCLUDE MORE
20 THAN FIVE HUNDRED THOUSAND DOLLARS ($500,000), IN THE AGGREGATE,
21 OF NET LOSSES FROM TAXABLE YEARS 1988 THROUGH 1994.
22 (2) (A) A NET LOSS FOR A TAXABLE YEAR MAY ONLY BE CARRIED
23 OVER PURSUANT TO THE FOLLOWING SCHEDULE:
24 TAXABLE YEAR CARRYOVER
25 1981 1 TAXABLE YEAR
26 1982 2 TAXABLE YEARS
27 1983-1987 3 TAXABLE YEARS
28 1988 2 TAXABLE YEARS PLUS
29 1 TAXABLE YEAR
30 STARTING WITH THE
20070H0377B4195 - 40 -
1 1995 TAXABLE YEAR
2 1989 1 TAXABLE YEAR PLUS
3 2 TAXABLE YEARS
4 STARTING WITH THE
5 1995 TAXABLE YEAR
6 1990-1993 3 TAXABLE YEARS
7 STARTING WITH THE
8 1995 TAXABLE YEAR
9 1994 1 TAXABLE YEAR
10 1995-1997 10 TAXABLE YEARS
11 1998 AND THEREAFTER 20 TAXABLE YEARS
12 (B) THE EARLIEST NET LOSS SHALL BE CARRIED OVER TO THE
13 EARLIEST TAXABLE YEAR TO WHICH IT MAY BE CARRIED UNDER THIS
14 SCHEDULE. THE TOTAL NET LOSS DEDUCTION ALLOWED IN ANY TAXABLE
15 YEAR SHALL NOT EXCEED:
16 (I) TWO MILLION DOLLARS ($2,000,000) FOR TAXABLE YEARS
17 BEGINNING BEFORE JANUARY 1, 2007.
18 (II) THE GREATER OF TWELVE AND ONE-HALF PER CENT OF THE
19 TAXABLE INCOME AS DETERMINED UNDER SUBCLAUSE 1 OR, IF
20 APPLICABLE, SUBCLAUSE 2 OR THREE MILLION DOLLARS ($3,000,000)
21 FOR TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2006.
22 (III) THE GREATER OF TWENTY PER CENT OF THE TAXABLE INCOME
23 AS DETERMINED UNDER SUBCLAUSE 1 OR, IF APPLICABLE, SUBCLAUSE 2
24 OR FIVE MILLION DOLLARS ($5,000,000) FOR TAXABLE YEARS BEGINNING
25 AFTER DECEMBER 31, 2008.
26 * * *
27 SECTION 4. THE AMENDMENT OF SECTION 303(A.3) OF THE ACT
28 SHALL APPLY TO PROPERTY PLACED IN SERVICE AFTER DECEMBER 31,
29 2008.
30 SECTION 5. THIS ACT SHALL TAKE EFFECT IMMEDIATELY.
20070H0377B4195 - 41 -
1 SECTION 1. THE ACT OF MARCH 4, 1971 (P.L.6, NO.2), KNOWN AS <--
2 THE TAX REFORM CODE OF 1971, IS AMENDED BY ADDING A SECTION TO
3 READ:
4 SECTION 304.1. ALTERNATIVE SPECIAL TAX PROVISION FOR POVERTY
5 STUDY.--(A) THE GENERAL ASSEMBLY DIRECTS THE JOINT STATE
6 GOVERNMENT COMMISSION TO CONDUCT OR PROVIDE FOR A COMPREHENSIVE
7 STUDY TO DETERMINE WHETHER ALTERNATIVE FORMS OF SPECIAL TAX
8 PROVISIONS FOR POVERTY WOULD BE MORE BENEFICIAL TO PERSONS WHO,
9 BECAUSE OF POVERTY ARE DETERMINED TO BE IN NEED OF SPECIAL TAX
10 PROVISIONS.
11 (B) THE STUDY SHALL INCLUDE A COMPARISON BETWEEN THE SPECIAL
12 TAX PROVISIONS FOR POVERTY SET FORTH UNDER SECTION 304 AND THE
13 EARNED INCOME CREDIT ALLOWABLE UNDER SECTION 32 OF THE INTERNAL
14 REVENUE CODE OF 1986 (PUBLIC LAW 99-514, 26 U.S.C. § 32), AS
15 AMENDED.
16 (C) THE STUDY SHALL CONSIDER ANY EFFECTS OF LINKING THE
17 ALTERNATIVE SPECIAL TAX PROVISIONS FOR POVERTY TO FEDERAL LAW,
18 INCLUDING ANY MISUSE THAT MAY BE INHERENT IN THE FEDERAL
19 PROGRAM.
20 (D) THE STUDY SHALL ASCERTAIN ANY DIFFERENCES BETWEEN THE
21 FISCAL COSTS TO THE COMMONWEALTH OF THE SPECIAL TAX PROVISIONS
22 FOR POVERTY SET FORTH UNDER SECTION 304 AND PROJECTED FISCAL
23 COSTS OF OTHER ALTERNATIVE PROVISIONS.
24 (E) THE JOINT STATE GOVERNMENT COMMISSION IS AUTHORIZED TO
25 HIRE OR RETAIN CONSULTANTS, UTILIZING A REQUEST FOR PROPOSAL
26 PROCEDURE, AS NECESSARY TO ASSIST IN THE PERFORMANCE OF ITS
27 DUTIES UNDER THIS SECTION.
28 (F) THE EXECUTIVE DIRECTOR OF THE JOINT STATE GOVERNMENT
29 COMMISSION SHALL PRESENT A REPORT SUMMARIZING THE RESULTS OF
30 THIS STUDY TO THE CHAIRMAN AND THE MINORITY CHAIRMAN OF THE
20070H0377B4195 - 42 -
1 FINANCE COMMITTEE OF THE SENATE AND THE CHAIRMAN AND THE
2 MINORITY CHAIRMAN OF THE FINANCE COMMITTEE OF THE HOUSE OF
3 REPRESENTATIVES AFTER AUGUST 1, 2009, AND BEFORE SEPTEMBER 1,
4 2009.
5 SECTION 2. SECTION 315.2 OF THE ACT, ADDED MAY 7, 1997
6 (P.L.85, NO.7), IS AMENDED TO READ:
7 SECTION 315.2. CONTRIBUTIONS TO BREAST AND CERVICAL CANCER
8 RESEARCH.--(A) THE DEPARTMENT SHALL PROVIDE A SPACE ON THE
9 PENNSYLVANIA INDIVIDUAL INCOME TAX RETURN FORM WHEREBY AN
10 INDIVIDUAL MAY VOLUNTARILY DESIGNATE A CONTRIBUTION OF ANY
11 AMOUNT DESIRED TO BE UTILIZED FOR BREAST AND CERVICAL CANCER
12 RESEARCH [IN THE DEPARTMENT OF HEALTH].
13 (B) THE AMOUNT SO DESIGNATED ON THE INDIVIDUAL INCOME TAX
14 RETURN FORM SHALL BE DEDUCTED FROM THE TAX REFUND TO WHICH THE
15 INDIVIDUAL IS ENTITLED AND SHALL NOT CONSTITUTE A CHARGE AGAINST
16 THE INCOME TAX REVENUES DUE TO THE COMMONWEALTH.
17 (C) THE DEPARTMENT SHALL DETERMINE ANNUALLY THE TOTAL AMOUNT
18 DESIGNATED UNDER THIS SECTION, LESS REASONABLE ADMINISTRATIVE
19 COSTS, AND SHALL REPORT THE AMOUNT TO THE STATE TREASURER WHO
20 SHALL TRANSFER THE AMOUNT FROM THE GENERAL FUND TO THE
21 [PENNSYLVANIA CANCER CONTROL, PREVENTION AND RESEARCH ADVISORY
22 BOARD WITHIN THE DEPARTMENT OF HEALTH] PENNSYLVANIA BREAST
23 CANCER COALITION.
24 (D) THE DEPARTMENT SHALL PROVIDE ADEQUATE INFORMATION
25 CONCERNING THE CHECKOFF FOR BREAST AND CERVICAL CANCER RESEARCH
26 IN ITS INSTRUCTIONS WHICH ACCOMPANY STATE INCOME TAX RETURN
27 FORMS. THE INFORMATION CONCERNING THE CHECKOFF SHALL INCLUDE THE
28 LISTING OF AN ADDRESS FURNISHED BY THE DEPARTMENT OF HEALTH TO
29 WHICH CONTRIBUTIONS MAY BE SENT BY TAXPAYERS WISHING TO
30 CONTRIBUTE TO THIS EFFORT BUT WHO DO NOT RECEIVE REFUNDS.
20070H0377B4195 - 43 -
1 ADDITIONALLY, THE [DEPARTMENT OF HEALTH] PENNSYLVANIA BREAST
2 CANCER COALITION SHALL BE CHARGED WITH THE DUTY TO CONDUCT A
3 PUBLIC INFORMATION CAMPAIGN ON THE AVAILABILITY OF THIS
4 OPPORTUNITY TO PENNSYLVANIA TAXPAYERS.
5 (E) THE [DEPARTMENT OF HEALTH] PENNSYLVANIA BREAST CANCER
6 COALITION SHALL REPORT ANNUALLY TO THE RESPECTIVE COMMITTEES OF
7 THE SENATE AND THE HOUSE OF REPRESENTATIVES WHICH HAVE
8 JURISDICTION OVER HEALTH MATTERS ON THE AMOUNT RECEIVED VIA THE
9 CHECKOFF PLAN AND HOW THE FUNDS WERE UTILIZED.
10 (F) THE GENERAL ASSEMBLY MAY, FROM TIME TO TIME, APPROPRIATE
11 FUNDS FOR BREAST AND CERVICAL CANCER RESEARCH [WITHIN THE
12 DEPARTMENT OF HEALTH].
13 SECTION 3. THE ACT IS AMENDED BY ADDING ARTICLES TO READ:
14 ARTICLE XVIII-C
15 (RESERVED)
16 ARTICLE XVIII-D
17 VOLUNTEER RESPONDER RETENTION
18 AND RECRUITMENT TAX CREDIT
19 SECTION 1801-D. DEFINITIONS.
20 THE FOLLOWING WORDS AND PHRASES WHEN USED IN THIS ARTICLE
21 SHALL HAVE THE MEANINGS GIVEN TO THEM IN THIS SECTION UNLESS THE
22 CONTEXT CLEARLY INDICATES OTHERWISE:
23 "ACTIVE VOLUNTEER." A VOLUNTEER FOR A VOLUNTEER AMBULANCE
24 SERVICE, VOLUNTEER FIRE COMPANY OR VOLUNTEER RESCUE COMPANY
25 CERTIFIED AS MEETING THE CRITERIA OF THIS ACT AS SET FORTH UNDER
26 SECTION 1807-D.
27 "COMMISSIONER." THE STATE FIRE COMMISSIONER APPOINTED UNDER
28 SECTION 3 OF THE ACT OF NOVEMBER 13, 1995 (P.L.604, NO.61),
29 KNOWN AS THE STATE FIRE COMMISSIONER ACT.
30 "DEPARTMENT." THE DEPARTMENT OF REVENUE OF THE COMMONWEALTH.
20070H0377B4195 - 44 -
1 "DIRECTOR." THE DIRECTOR OF THE EMERGENCY MEDICAL SERVICES
2 OFFICE IN THE DEPARTMENT OF HEALTH.
3 "QUALIFIED TAX LIABILITY." THE LIABILITY FOR TAXES IMPOSED
4 UNDER ARTICLE III FOR THE TAXABLE YEAR BEGINNING AFTER DECEMBER
5 31, 2007 AND ENDING BEFORE JANUARY 1, 2009.
6 "TAX CREDIT." THE TAX CREDIT AVAILABLE TO ACTIVE VOLUNTEERS
7 UNDER THIS ARTICLE.
8 "TAXPAYER." AN INDIVIDUAL SUBJECT TO PAYMENT OF TAXES UNDER
9 ARTICLE III.
10 "VOLUNTEER AMBULANCE SERVICE." AS DEFINED IN SECTION 102 OF
11 THE ACT OF JULY 31, 2003 (P.L.73, NO.17), KNOWN AS THE VOLUNTEER
12 FIRE COMPANY AND VOLUNTEER AMBULANCE SERVICE GRANT ACT.
13 "VOLUNTEER FIRE COMPANY." AS DEFINED IN SECTION 102 OF THE
14 ACT OF JULY 31, 2003 (P.L.73, NO.17), KNOWN AS THE VOLUNTEER
15 FIRE COMPANY AND VOLUNTEER AMBULANCE SERVICE GRANT ACT.
16 "VOLUNTEER RESCUE COMPANY." AS DEFINED IN SECTION 102 OF THE
17 ACT OF JULY 31, 2003 (P.L.73, NO.17), KNOWN AS THE VOLUNTEER
18 FIRE COMPANY AND VOLUNTEER AMBULANCE SERVICE GRANT ACT.
19 SECTION 1802-D. APPLICATION.
20 (A) APPLICATION TO DEPARTMENT.--A TAXPAYER MAY SUBMIT AN
21 APPLICATION FOR A TAX CREDIT UNDER THIS ARTICLE IN A MANNER
22 REQUIRED BY THE DEPARTMENT. THE APPLICATION SHALL CONTAIN THE
23 FOLLOWING INFORMATION:
24 (1) THE NAME AND TAX IDENTIFICATION NUMBER OF THE
25 TAXPAYER.
26 (2) THE NAME AND LOCATION OF THE VOLUNTEER FIRE COMPANY,
27 VOLUNTEER AMBULANCE SERVICE OR VOLUNTEER RESCUE COMPANY OF
28 WHICH THE TAXPAYER IS AN ACTIVE VOLUNTEER.
29 (3) A CERTIFICATION FOR THE APPLICANT DESCRIBED IN
30 SECTION 1809-D.
20070H0377B4195 - 45 -
1 (4) ANY OTHER INFORMATION DEEMED APPROPRIATE BY THE
2 DEPARTMENT.
3 (B) PROCEDURE.--THE APPLICATION SHALL BE ATTACHED TO THE
4 APPLICANT'S ANNUAL TAX RETURN REQUIRED TO BE FILED UNDER ARTICLE
5 III.
6 SECTION 1803-D. TAXPAYER CREDIT.
7 A TAXPAYER MAY CLAIM A TAX CREDIT AGAINST THE QUALIFIED TAX
8 LIABILITY OF THE TAXPAYER.
9 SECTION 1804-D. TAXPAYER ELIGIBILITY.
10 (A) CREDIT.--A TAXPAYER SHALL BE ELIGIBLE FOR A TAX CREDIT
11 UNDER SUBSECTION (B) AGAINST THE TAX IMPOSED UNDER ARTICLE III
12 IF THE TAXPAYER IS AN ACTIVE VOLUNTEER WITHIN THIS COMMONWEALTH.
13 (B) MAXIMUM CREDIT.--THE FOLLOWING SHALL APPLY:
14 (1) A TAXPAYER WHO QUALIFIES UNDER SUBSECTION (A) MAY
15 CLAIM A TAX CREDIT OF $100.
16 (2) (I) IF THE TAXPAYER IS NOT AN ACTIVE VOLUNTEER FOR
17 THE ENTIRE TAX YEAR, THE AMOUNT OF THE TAX CREDIT SHALL
18 BE PRORATED AND THE CREDIT AMOUNT SHALL EQUAL THE MAXIMUM
19 AMOUNT OF CREDIT FOR THE TAX YEAR, DIVIDED BY 12,
20 MULTIPLIED BY THE NUMBER OF MONTHS IN THE TAX YEAR THE
21 TAXPAYER WAS AN ACTIVE VOLUNTEER. THE CREDIT SHALL BE
22 ROUNDED TO THE NEAREST $5.
23 (II) IF THE TAXPAYER IS AN ACTIVE VOLUNTEER DURING
24 ANY PART OF A MONTH, THE TAXPAYER SHALL BE CONSIDERED AN
25 ACTIVE VOLUNTEER FOR THE ENTIRE MONTH.
26 SECTION 1805-D. CARRY OVER AND CARRYBACK.
27 (A) GENERAL RULE.--IF THE TAXPAYER CANNOT USE THE ENTIRE
28 AMOUNT OF THE TAX CREDIT FOR THE TAXABLE YEAR IN WHICH THE
29 TAXPAYER IS ELIGIBLE FOR THE CREDIT, THE EXCESS MAY BE CARRIED
30 OVER TO SUCCEEDING TAXABLE YEARS AND USED AS A CREDIT AGAINST
20070H0377B4195 - 46 -
1 THE QUALIFIED TAX LIABILITY OF THE TAXPAYER FOR THOSE TAXABLE
2 YEARS. EACH TIME THE TAX CREDIT IS CARRIED OVER TO A SUCCEEDING
3 TAXABLE YEAR, IT SHALL BE REDUCED BY THE AMOUNT THAT WAS USED AS
4 A CREDIT DURING THE IMMEDIATELY PROCEEDING TAXABLE YEAR. THE TAX
5 CREDIT PROVIDED BY THIS ARTICLE MAY BE CARRIED OVER AND APPLIED
6 TO SUCCEEDING TAXABLE YEARS FOR NO MORE THAN THREE TAXABLE YEARS
7 FOLLOWING THE FIRST TAXABLE YEAR FOR WHICH THE TAXPAYER WAS
8 ENTITLED TO CLAIM THE CREDIT.
9 (B) APPLICATION.--A TAX CREDIT APPROVED BY THE DEPARTMENT IN
10 A TAXABLE YEAR SHALL FIRST BE APPLIED AGAINST THE TAXPAYER'S
11 QUALIFIED LIABILITY FOR THE CURRENT TAXABLE YEAR AS OF THE DATE
12 ON WHICH THE CREDIT WAS APPROVED BEFORE THE TAX CREDIT CAN BE
13 APPLIED AGAINST ANY TAX LIABILITY UNDER SUBSECTION (A).
14 (C) LIMITATIONS.--A TAXPAYER IS NOT ENTITLED TO CARRY BACK,
15 OBTAIN A REFUND OF, SELL OR ASSIGN AN UNUSED TAX CREDIT.
16 SECTION 1806-D. TOTAL AMOUNT OF CREDITS.
17 THE TOTAL AMOUNT OF TAX CREDITS AUTHORIZED BY THIS ARTICLE
18 SHALL NOT EXCEED $4,500,000.
19 SECTION 1807-D. POINT SYSTEM.
20 (A) GENERAL RULE.--THE COMMISSIONER AND THE DIRECTOR SHALL
21 JOINTLY DEVELOP AND IMPLEMENT A POINT SYSTEM ESTABLISHING THE
22 ANNUAL REQUIREMENTS FOR CERTIFICATION OF ACTIVE VOLUNTEERS.
23 (B) FACTORS.--TO DETERMINE WHETHER TO CERTIFY AN INDIVIDUAL
24 AS AN ACTIVE VOLUNTEER, THE POINT SYSTEM SHALL CONSIDER THE
25 FOLLOWING FACTORS:
26 (1) THE NUMBER OF EMERGENCY CALLS RESPONDED TO.
27 (2) THE VOLUNTEER'S LEVEL OF TRAINING AND PARTICIPATION
28 IN FORMAL TRAINING AND DRILLS.
29 (3) TIME SPENT ON ADMINISTRATION AND SUPPORT ACTIVITIES,
30 INCLUDING FUNDRAISING AND MAINTENANCE OF FACILITIES AND
20070H0377B4195 - 47 -
1 EQUIPMENT.
2 (4) INVOLVEMENT IN OTHER PROJECTS THAT DIRECTLY BENEFIT
3 THE ORGANIZATION'S FINANCIAL VIABILITY, EMERGENCY RESPONSE OR
4 OPERATIONAL READINESS.
5 SECTION 1808-D. (RESERVED).
6 SECTION 1809-D. CERTIFICATION.
7 (A) SELF CERTIFICATION.--THE ACTIVE VOLUNTEER SHALL SIGN AND
8 SUBMIT THE APPLICATION TO THE CHIEF OF THE VOLUNTEER FIRE
9 COMPANY OR THE SUPERVISOR OR CHIEF OF THE VOLUNTEER AMBULANCE
10 SERVICE OR VOLUNTEER RESCUE COMPANY FIRE OR EMS DEPARTMENT WHERE
11 HE OR SHE SERVES.
12 (B) LOCAL SIGN-OFF.--THE CHIEF AND ANOTHER OFFICER OF THE
13 VOLUNTEER FIRE COMPANY, THE SUPERVISOR OR CHIEF AND ANOTHER
14 OFFICER OF THE VOLUNTEER AMBULANCE SERVICE OR VOLUNTEER RESCUE
15 COMPANY SHALL SIGN THE APPLICATION ATTESTING TO THE INDIVIDUAL'S
16 STATUS AS AN ACTIVE VOLUNTEER. THE APPLICATION SHALL THEN BE
17 FORWARDED TO THE DEPARTMENT FOR FINAL REVIEW AND PROCESSING.
18 SECTION 1810-D. GUIDELINES.
19 THE DEPARTMENT SHALL ADOPT GUIDELINES, INCLUDING FORMS,
20 NECESSARY TO ADMINISTER THIS ARTICLE. THE DEPARTMENT MAY REQUIRE
21 PROOF OF THE CLAIM FOR TAX CREDIT.
22 SECTION 1811-D. REPORT TO GENERAL ASSEMBLY.
23 NO LATER THAN JUNE 1, 2009, THE DEPARTMENT SHALL SUBMIT A
24 REPORT ON THE TAX CREDITS GRANTED UNDER THIS ARTICLE AND THE
25 APPLICABILITY OF THE TAX CREDIT TO THE RETENTION OF ACTIVE
26 VOLUNTEERS OF A VOLUNTEER AMBULANCE SERVICE, VOLUNTEER FIRE
27 COMPANY OR VOLUNTEER RESCUE COMPANY. THE REPORT SHALL INCLUDE
28 THE NAMES OF TAXPAYERS WHO UTILIZED THE CREDIT AS OF THE DATE OF
29 THE REPORT AND THE AMOUNT OF CREDITS APPROVED. THE REPORT MAY
30 INCLUDE RECOMMENDATIONS FOR CHANGES IN THE CALCULATION OR
20070H0377B4195 - 48 -
1 ADMINISTRATION OF THE TAX CREDIT. THE REPORT SHALL BE SUBMITTED
2 TO THE CHAIRMAN AND MINORITY CHAIRMAN OF THE APPROPRIATIONS
3 COMMITTEE OF THE SENATE, THE CHAIRMAN AND MINORITY CHAIRMAN OF
4 THE APPROPRIATIONS COMMITTEE OF THE HOUSE OF REPRESENTATIVES,
5 THE CHAIRMAN AND MINORITY CHAIRMAN OF THE FINANCE COMMITTEE OF
6 THE SENATE AND THE CHAIRMAN AND MINORITY CHAIRMAN OF THE FINANCE
7 COMMITTEE OF THE HOUSE OF REPRESENTATIVES. THE REPORT MAY
8 INCLUDE OTHER INFORMATION THAT THE DEPARTMENT DEEMS APPROPRIATE.
9 SECTION 1812-D. PENALTY.
10 A TAXPAYER WHO CLAIMS A CREDIT UNDER THIS ARTICLE BUT FAILS
11 TO MEET THE STANDARDS UNDER SECTION 1804-D SHALL REPAY THE FULL
12 AMOUNT OF THE TAX CREDIT TO THE COMMONWEALTH.
13 SECTION 4. THE ADDITION OF ARTICLE XVIII-D OF THE ACT SHALL
14 APPLY TO TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2007, AND
15 ENDING BEFORE JANUARY 1, 2009.
16 SECTION 5. THIS ACT SHALL TAKE EFFECT IMMEDIATELY.
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