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PRINTER'S NO. 2636
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
2274
Session of
2022
INTRODUCED BY C. WILLIAMS, MIZGORSKI, RYAN, STAATS, SAPPEY,
PICKETT, SILVIS, ROWE, DeLUCA, NEILSON AND MOUL,
JANUARY 24, 2022
REFERRED TO COMMITTEE ON FINANCE, JANUARY 24, 2022
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," in tax amnesty program for fiscal year 2009-2010,
further providing for establishment of program; in tax
amnesty program for fiscal year 2016-2017, further providing
for establishment of program; and providing for 2021 tax
penalty forgiveness program.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Sections 2902-F(c) and 2902-G(c) of the act of
March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of
1971, are amended to read:
Section 2902-F. Establishment of program.
* * *
(c) Future [amnesty] tax penalty forgiveness program
participation.--[A] Except for the tax penalty forgiveness
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program under Article XXIX-G.1, a taxpayer who participates in
the program shall not be eligible to participate in a future tax
[amnesty] penalty forgiveness program.
* * *
Section 2902-G. Establishment of program.
* * *
(c) Future [amnesty] penalty forgiveness program
participation.--[A] Except for the tax penalty forgiveness
program under Article XXIX-G.1, a taxpayer who participates in
the program shall not be eligible to participate in a future tax
[amnesty] penalty forgiveness program.
* * *
Section 2. The act is amended by adding an article to read:
ARTICLE XXIX-G.1
2021 TAX PENALTY FORGIVENESS PROGRAM
Section 2901-G.1. 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:
"Department." The Department of Revenue of the Commonwealth.
"Eligible tax." Any tax administered by the Department of
Revenue delinquent as of December 31, 2021. The term includes
any interest, penalty or fees on an eligible tax. For an unknown
liability, the term shall only include taxes due within five
years prior to December 31, 2021. For purposes of taxes
collected under the International Fuel Tax Agreement, the term
shall apply only to taxes, interest and penalties owed to the
Commonwealth, not to other states or Canadian provinces.
"Program." The tax penalty forgiveness program established
under section 2902-G.1 as provided for in this article.
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"Tax penalty forgiveness period." The time period of 60
consecutive days established by the Governor ending no later
than June 30, 2022.
"Taxpayer." Any person, association, fiduciary, partnership,
corporation or other entity required to pay or collect any of
the eligible taxes. The term shall not include a taxpayer who,
prior to the tax penalty forgiveness period, has received notice
that the taxpayer is the subject of a criminal investigation for
an alleged violation of any law imposing an eligible tax or who,
prior to the tax penalty forgiveness period, has been named as a
defendant in a criminal complaint alleging a violation of any
law imposing an eligible tax or is a defendant in a pending
criminal action for an alleged violation of any law imposing an
eligible tax.
"Unknown liability." A liability for an eligible tax for
which either:
(1) no return or report has been filed, no payment has
been made and the taxpayer has not been contacted by the
department concerning the unfiled returns or reports or
unpaid tax; or
(2) a return or report has been filed, the tax was
underreported and the taxpayer has not been contacted by the
department concerning the underreported tax and is not
already under audit when the tax penalty forgiveness period
begins.
Section 2902-G.1. Establishment of program.
(a) General rule.--A tax penalty forgiveness program is
established and shall be administered by the department.
(b) Applicability.--The program shall apply to a taxpayer
who is delinquent on payment of a liability for an eligible tax
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as of December 31, 2020, including a liability for returns not
filed, liabilities according to records of the department as of
December 31, 2020, liabilities not reported, underreported or
not established, but delinquent as of December 31, 2020.
(c) Deferred payment plan agreement.--Existing deferred
payment plan agreements between a taxpayer and the department
where the agreement applies to a tax liability for which tax
penalty forgiveness is sought by the taxpayer for amounts
remaining on the tax liability, the taxpayer, as a condition of
receiving tax penalty forgiveness, shall pay the liability,
notwithstanding terms of the agreement to the contrary, in full
during the tax penalty forgiveness period.
(d) Participation not prohibited.--Notwithstanding the
provisions of the former section 2902-A(c), a taxpayer who
participated in the program under the former Article XXIX-A
shall not be prohibited from participation in the program due to
participation in the program under the former Article XXIX-A.
Section 2903-G.1. Required payment.
(a) Taxpayer requirements.--Subject to section 2904-G.1, all
taxpayers who participate in the program shall comply with all
of the following:
(1) During the tax penalty forgiveness period, file a
tax penalty forgiveness return in such form and containing
such information as the department shall require. A tax
penalty forgiveness return shall be considered to be timely
filed if it is postmarked during the tax penalty forgiveness
period or timely electronically or otherwise filed.
(2) During the tax penalty forgiveness period, make
payment of all taxes and one-half of the interest due to the
Commonwealth in accordance with the tax penalty forgiveness
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return that is filed. The taxpayer shall not be required to
pay any penalty or fees applicable to an eligible tax. Except
as provided under paragraph (3), the taxpayer shall not be
required to pay any penalty or fees applicable to an eligible
tax. A tax penalty or fee waived under this paragraph shall
not include the following:
(i) An additional penalty under the former section
2916-A.
(ii) An additional penalty under section 2913-F.
(iii) An additional penalty under section 2913-G.
(iv) A fee under section 3003.7.
(v) A fee under section 3003.9.
(3) File complete tax returns for all required years for
which the taxpayer previously has not filed a tax return and
file complete amended returns for all required years for
which the taxpayer underreported eligible tax liability.
(b) Prohibitions.--
(1) The department may not collect the penalties or fees
waived under subsection (a)(2). Except as otherwise provided
in this article, the department shall not pursue
administrative or judicial proceeding against a taxpayer with
respect to an eligible tax that is disclosed on a tax penalty
forgiveness return.
(2) A taxpayer with unknown liabilities reported and
paid under the program and who complies with all other
requirements of this article shall not be liable for any
taxes of the same type due prior to January 1, 2021. A
taxpayer shall not be owed a refund under this article.
Section 2904-G.1. Tax penalty forgiveness contingent on
continued compliance.
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Notwithstanding any other provision of this article, the
department may assess and collect from a taxpayer all penalties
waived through the program if, within two years after the end of
the program, either of the following occurs:
(1) the taxpayer granted tax penalty forgiveness under
this article becomes delinquent for three consecutive periods
in payment of taxes due or filing of returns required on a
semimonthly, monthly, quarterly or other basis, and the
taxpayer has not contested the tax liability through a timely
valid administrative or judicial appeal; or
(2) the taxpayer granted tax penalty forgiveness under
this article becomes delinquent and is eight or more months
late in payment of taxes due or filing of returns on an
annual basis, and the taxpayer has not contested the
liability through a timely valid administrative or judicial
appeal.
Section 2905-G.1. Limitation of deficiency assessment.
If, subsequent to the tax penalty forgiveness period, the
department issues a deficiency assessment with respect to a tax
penalty forgiveness return, the department may impose penalties
and pursue a criminal action only with respect to the difference
between the amount shown on that tax penalty forgiveness return
and the current amount of tax.
Section 2906-G.1. Overpayment of tax.
Notwithstanding any other provisions of this article or any
other act, if an overpayment of eligible tax is refunded or
credited within 180 days after the tax penalty forgiveness
return is filed or the eligible tax is paid, whichever is later,
no interest shall be allowed on the overpayment.
Section 2907-G.1. Previously paid interest and penalties.
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No refund or credit shall be allowed for any interest or
penalty on eligible taxes paid to the department prior to the
tax penalty forgiveness period.
Section 2908-G.1. Proceedings relating to tax penalty
forgiveness return barred.
Participation in the program shall be conditioned upon the
taxpayer's agreement that the right to protest or pursue an
administrative or judicial proceeding with regard to tax penalty
forgiveness returns filed under the program or to claim any
refund of money paid under the program is barred.
Section 2909-G.1. Undisclosed liabilities.
Nothing in this article shall be construed to prohibit the
department from instituting civil or criminal proceedings
against a taxpayer with respect to an amount of tax that is not
disclosed on the tax penalty forgiveness return or an amount
disclosed on the tax penalty forgiveness return that is not
paid.
Section 2910-G.1. Duties of department.
(a) Guidelines.--The department shall develop guidelines to
implement the provisions of this article. The guidelines shall
be published in the Pennsylvania Bulletin within 60 days of the
effective date of this section and shall contain, but not be
limited to, the following information:
(1) An explanation of the program and the requirements
for eligibility for the program.
(2) The dates during which a tax penalty forgiveness
return may be filed.
(3) A specimen copy of the tax penalty forgiveness
return.
(4) The tax penalty forgiveness revenue estimates
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required under section 2912-G.1(b).
(b) Publicity.--The department shall publicize the program
to maximize public awareness of and participation in the
program. The department shall coordinate to the highest degree
possible its publicity efforts and other actions taken to
implement this article.
(c) Reports.--The department shall issue reports to the
General Assembly detailing program implementation. The reports
shall contain the following information:
(1) Within 30 days after the end of the tax penalty
forgiveness period:
(i) A detailed breakdown of the department's
administrative costs in implementing the program.
(ii) The total dollar amount of revenue collected by
the program.
(2) Within 180 days after the end of the tax penalty
forgiveness period:
(i) The number of tax penalty forgiveness returns
filed and a breakdown of the number and dollar amount of
revenue raised for each tax by calendar year during which
the tax period ended. In addition, the gross revenues
shall be broken down in the following categories:
(A) Amounts represented by assessments
receivable established by the department on or before
the first day of the tax penalty forgiveness period.
(B) All other amounts.
(ii) The total dollar amount of penalties and
interest waived under the program.
(iii) The demographic characteristics of tax penalty
forgiveness participants, including North American
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Industry Classification System codes of participants,
type of taxpayer, consisting of individual, partnership,
corporation or other entity, size of tax liability and
geographical location.
(d) Notification.--The department shall notify in writing
all known tax delinquents at the taxpayers' last known valid
addresses of the existence of the program. The sole purpose of
the letter sent by the department to taxpayers shall be
notification of the program.
Section 2911-G.1. Method of payment.
All tax payments under the program shall be made by certified
check, money order, electronic transfer, credit card or other
financial instrument acceptable to the department.
Section 2912-G.1. Use of revenue.
(a) Restricted revenue account.--All revenue generated by
this article shall be deposited into a restricted revenue
account in the General Fund. Revenue from the restricted revenue
account shall be distributed as follows:
(1) All money from General Fund sources shall be
deposited in the General Fund no later than June 30, 2022,
less repayment of any costs for administration of the program
to the department.
(2) All revenue from Motor License Fund sources shall be
deposited in the Motor License Fund no later than June 30,
2022.
(3) All revenue from Liquid Fuels Tax Fund sources shall
be deposited in the Liquid Fuels Tax Fund no later than June
30, 2022.
(b) Revenue estimates.--
(1) The department shall submit, for publication in the
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Pennsylvania Bulletin:
(i) a separate tax penalty forgiveness revenue
estimate for revenue generated under this article from
the following sources:
(A) The General Fund.
(B) The Motor License Fund.
(C) The Liquid Fuels Tax Fund.
(ii) The methodology used to develop the estimate.
(2) All tax penalty forgiveness revenue estimates shall
be submitted for publication pursuant to section 2910-G.1(a)
(4).
Section 2913-G.1. Construction.
Except as expressly provided in this article, this article
shall not:
(1) be construed to relieve a person, corporation or
other entity from the filing of a return or from a tax,
penalty or interest imposed by the provisions of any law;
(2) affect or terminate a petition, investigation,
prosecution, legal or otherwise, or other proceeding pending
under the provisions of any such law; or
(3) prevent the commencement or further prosecution of a
proceeding by the proper authorities of the Commonwealth for
violation of any such law or for the assessment, settlement,
collection or recovery of tax, penalty or interest due to the
Commonwealth under any such law.
Section 2914-G.1. Suspension of inconsistent acts.
All acts or parts of acts inconsistent with the provisions of
this article are suspended to the extent necessary to carry out
the provisions of this article.
Section 3. This act shall take effect in 60 days.
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