PRIOR PRINTER'S NO. 836
PRINTER'S NO. 869
THE GENERAL ASSEMBLY OF PENNSYLVANIA
SENATE BILL
No.
734
Session of
2021
INTRODUCED BY HAYWOOD, SANTARSIERO, COSTA, KANE, TARTAGLIONE,
MENSCH, HUGHES, CAPPELLETTI AND MUTH, JUNE 3, 2021
SENATOR HUTCHINSON, FINANCE, AS AMENDED, JUNE 8, 2021
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 credit eligibility, further providing for
definitions and for eligibility and providing for independent
audit for tax credits, for additional requirements for
certain tax credits, for independent audit for certain tax
benefits, for additional requirements for tax benefits, for
broker registration, for tax credit administration, for tax
benefit administration and for guidelines; in research and
development tax credit, further providing for credit for
research and development expenses and for report to General
Assembly; in keystone innovation zones, further providing for
keystone innovation zone tax credits and for annual report;
and making editorial changes.
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 CREDIT ELIGIBILITY, FURTHER PROVIDING FOR
DEFINITIONS AND FOR ELIGIBILITY AND PROVIDING FOR APPLICATION
AND ADMINISTRATION, FOR ASSESSMENT, FOR ADMINISTERING AGENCY
TRAINING, FOR BROKER REGISTRATION, FOR TAX CREDIT AND TAX
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BENEFIT REPORTS, FOR ALLOCATION OF TAX CREDITS OR TAX BENEFIT
PROGRAM AWARDED UPON APPEAL AND FOR GUIDELINES; IN RESEARCH
AND DEVELOPMENT TAX CREDIT, FURTHER PROVIDING FOR CREDIT FOR
RESEARCH AND DEVELOPMENT EXPENSES, FOR CARRYOVER, CARRYBACK,
REFUND AND ASSIGNMENT OF CREDIT AND FOR REPORT TO GENERAL
ASSEMBLY; IN KEYSTONE INNOVATION ZONES, FURTHER PROVIDING FOR
KEYSTONE INNOVATION ZONE TAX CREDITS AND FOR ANNUAL REPORT;
IN PROCEDURE AND ADMINISTRATION, FURTHER PROVIDING FOR
PETITION FOR REASSESSMENT, FOR PETITION PROCEDURE AND FOR
REVIEW BY BOARD; AND MAKING EDITORIAL CHANGES.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. The heading of Article XVII-A.1 of the act of
March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of
1971, is amended to read:
ARTICLE XVII-A.1
TAX CREDIT [ELIGIBILITY] ADMINISTRATION
Section 2. The definition of "tax credit" in section 1701-
A.1 of the act is amended and the section is amended by adding
definitions to read:
Section 1701-A.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:
"Administering agency." The department, board or commission
that administers a tax benefit or tax credit.
"Broker." Any person registered to engage in the business of
effecting transactions in tax credits for the account of others,
including assisting a taxpayer, business firm or other recipient
to apply for, sell or purchase a tax credit. The term includes
an entity and any partner, officer, director or affiliate of the
entity or a person occupying a similar status or performing
similar functions for the entity.
* * *
"Tax benefit." A tax benefit authorized under any of the
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following:
(1) Article XVII-A.
(2) Article XVIII-C.
(3) Article XIX-B.
(4) Article XIX-D.
(5) Article XXIX-C.
(6) Article XXIX-D.
(7) The act of October 6, 1998 (P.L.705, No.92), known
as the Keystone Opportunity Zone, Keystone Opportunity
Expansion Zone and Keystone Opportunity Improvement Zone Act.
"Tax credit." A tax credit authorized under any of the
following:
(1) Article XVII-B.
(2) Article XVII-D.
(3) Article XVII-E.
(4) Article XVII-G.
(5) Article XVII-H.
(6) Article XVII-I.
(7) Article XVII-J.
(8) Article XVII-K.
(8.1) Article XVII-L.
(9) Article XVIII.
(10) Article XVIII-B.
(11) Article XVIII-D.
(12) Article XVIII-E.
(13) Article XVIII-F.
(14) Article XVIII-G.
(14.1) Article XVIII-H.
(15) Article XIX-A.
(16) Article XIX-E.
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(16.1) Article XIX-C.
(16.2) Article XIX-F.
(17) Section 2010.
(18) Article XXIX-D.
(19) Article XX-B of the act of March 10, 1949 (P.L.30,
No.14), known as the Public School Code of 1949.
(20) The act of December 1, 2004 (P.L.1750, No.226),
known as the First Class Cities Economic Development District
Act.
(21) 12 Pa.C.S. Ch. 34 (relating to Infrastructure and
Facilities Improvement Program).
Section 3. Section 1702-A.1 of the act is amended to read:
Section 1702-A.1. Eligibility.
(a) Except as otherwise provided by law, before a tax credit
or tax benefit can be awarded, the department or administering
agency, as applicable, may make a finding that the taxpayer has
filed all required State tax reports and returns for all
applicable taxable years and paid any balance of State tax due
as determined at settlement or assessment by the department,
unless the tax due is currently under appeal.
(b) [(Reserved).] The department or administering agency,
as applicable, may require returns, reports, documents,
statements, applications or registrations for a tax benefit or
tax credit to be filed electronically.
Section 4. The act is amended by adding sections to read:
Section 1703-A.1. Independent audit for tax credits.
(a) Except as otherwise provided by law, before a tax credit
can be awarded, sold or assigned, the applicant may be required
to hire an independent auditor to prepare audited financial
statements. The department may require the audited financial
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statements due to material misrepresentations made on a tax
credit application or if the administering agency suspects the
applicant is committing fraudulent activity. The department may
require that the audited financial statements contain
information as the department requires.
(b) The independent audit under subsection (a) shall be
conducted by a certified public accountant.
Section 1704-A.1. Additional requirements for tax credits.
(a) Except as otherwise provided by law, before a tax credit
may be awarded, sold or assigned, the department, in
consultation with the administering agency, may:
(1) Require the submission of all of the following with
a tax credit application:
(i) Photo identification of the applicant's chief
executive officer and authorized representative
responsible for submitting the tax credit application.
Photo identification shall include the individual's name
and address.
(ii) Bank account statements relating to the
business.
(iii) Business records, such as receipts and
expenditures.
(iv) Business origination documents, such as
articles of incorporation, partnership or reference to
documents under this subparagraph in records of the
Department of State or similar entity in another
jurisdiction.
(2) Require that the applicant meet for an in-person
interview with representatives or agents of the department to
verify the application and materials provided under this
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section.
(3) Require the business to agree to submit to scheduled
and unscheduled site inspections by the administering agency
or the representatives and agents of the department.
(b) The administering agency may require all representatives
and agents of the administering agency who assist businesses
with applications for tax credits to:
(1) Obtain appropriate training from the administering
agency for conducting on-site visits for the purposes of
verifying compliance with all requirements relating to
application for and issuance of a tax credit.
(2) Advise a business that has been issued a tax credit
of the responsibility of the business in filing reports
concerning use of the tax credit as provided by law.
(3) Conduct scheduled and unscheduled visits to the
sites of tax credit awardees to ensure compliance with the
requirements of the tax credit.
(c) A successful applicant who is awarded a tax credit shall
file an annual report with the department detailing how the tax
credit was used or if the tax credits were sold. The report
shall include the following and any other information the
department deems necessary:
(1) Itemization of expenses and income generated by the
business to which the tax credit applied.
(2) A report of how money associated with the tax credit
was used.
(3) If sold, the broker used in the transaction of sale.
Section 1705-A.1. Independent audit for tax benefits.
(a) Except as otherwise provided by law, before a tax
benefit can be awarded, sold or assigned, the applicant may be
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required to hire an independent auditor to prepare audited
financial statements. The department may require the submission
of audited financial statements. Audited financial statements
shall be required if the administering agency suspects the
applicant is committing fraudulent activity or that a material
misrepresentation was made on the tax benefit application. The
department may require that the audited financial statements
contain information as the department requires.
(b) The independent audit under subsection (a) shall be
conducted by a certified public accountant.
Section 1706-A.1. Additional requirements for tax benefits.
(a) Except as otherwise provided by law, before a tax
benefit may be awarded, sold or assigned, the department, in
consultation with the administering agency, may:
(1) Require the submission of all of the following with
a tax benefit application:
(i) Photo identification of the applicant's chief
executive officer and authorized representative
responsible for submitting the tax credit application.
Photo identification shall include the individual's name
and address.
(ii) Bank account statements relating to the
business.
(iii) Business records, such as receipts and
expenditures.
(iv) Business origination documents, such as
articles of incorporation, partnership or reference to
documents under this subparagraph in records of the
Department of State or similar entity in another
jurisdiction.
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(2) Require that the applicant meet for an in-person
interview with representatives or agents of the department to
verify the application and materials provided under this
section.
(3) Require the business to agree to submit to scheduled
and unscheduled site inspections by the administering agency
or the representatives or agents of the department.
(b) The administering agency may require all representatives
and agents of the administering agency who assist businesses
with applications for tax benefit to:
(1) Obtain appropriate training from the administering
agency for conducting on-site visits for the purposes of
verifying compliance with all requirements relating to
application for and issuance of a tax benefit.
(2) Advise a business that has been issued a tax benefit
of the responsibility of the business for filing reports
concerning use of the tax benefit as provided by law.
(3) Conduct scheduled and unscheduled visits to the
sites of tax benefit awardees to ensure compliance with the
requirements of the tax benefit.
(c) A successful applicant who is awarded a tax benefit
shall file an annual report with the department detailing how
the tax benefit was used or if the tax benefits were sold. The
report shall include, but is not limited to, the following:
(1) Itemization of expenses and income generated by the
business to which the tax benefit applied.
(2) A report of how money associated with the tax
benefit was used.
(3) If sold, the broker used in the transaction of sale.
Section 1707-A.1. Broker registration.
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(a) All brokers shall be registered under this section. Any
agent or other party representing a broker or assisting a broker
in effecting the application for, purchase of or sale of a tax
credit or tax benefit shall be registered under this section.
(b) The department, in consultation with the Department of
Community and Economic Development, shall establish guidelines
providing for the application and registration of brokers under
this article. The guidelines shall require, but not be limited
to, the following:
(1) Name and address of the broker showing that the
broker resides in this Commonwealth.
(2) Name and address of the business with which the
broker is employed or otherwise associated that is located in
this Commonwealth.
(3) The broker be at least 18 years of age.
(4) Minimum educational requirements, qualifications and
experience necessary for the issuance of a registration under
this article.
(5) A criminal background check prepared by the
Pennsylvania State Police that demonstrates the broker has
not been convicted of any felony offense or an offense that
involved fraud or misrepresentation in this Commonwealth or
any other jurisdiction.
(6) A list of any professional licenses that have been
issued to the broker and whether the broker is in good
standing with the licensing authority.
(7) Verification that the application is submitted under
18 Pa.C.S. §§ 4903 (relating to false swearing) and 4904
(relating to unsworn falsification to authorities).
(8) Payment of any required application, licensing and
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registration fees.
(9) Tax clearance showing all satisfaction of all State
and local taxes.
(c) A broker shall obtain an initial or renewed registration
by filing an application with the department, providing
information and documentation and paying all fees as required by
the department.
(d) A registration issued under this section shall include a
unique registration number for the registrant and be valid for
two years from the date of issue. A registration issued under
this section may be suspended or revoked by the department for
good cause.
(e) A broker denied a registration, or whose registration is
suspended or revoked, may appeal the department's determination
in the same manner as provided by Article XXVII.
(f) Brokers effecting the sale of a tax credit or tax
benefit or assisting a taxpayer, business firm or other
recipient to apply for or purchase a tax credit or tax benefit,
shall attach to the application a certification that the
statements and representations made in the application are true
and correct and subject to the penalties as set forth in 18
Pa.C.S. § 4903 or 4904 and shall include the broker's unique
registration number issued by the department.
(g) The department may require the payment of an application
fee to review and process a registration.
(h) A broker registered under this section shall post a bond
of $50,000 with the department.
Section 1708-A.1. Tax credit administration.
(a) The department shall have the following powers:
(1) To audit a taxpayer, business firm or other
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recipient of a tax credit, including the purchaser of a tax
credit.
(2) To issue an assessment against a taxpayer, business
firm or other recipient of a tax credit or beneficiary of a
tax credit if the department determines that the tax credit
was improperly issued or the benefits of the tax credit were
improperly conferred. If a tax credit is sold to a bona fide
purchaser for value, the department may only issue an
assessment against the party selling the tax credit and the
broker signing the certification required by section 1707-
A.1(f). The seller and the broker shall be jointly and
severally liable for the amount due.
(b) The procedures, collection, enforcement and appeals of
any assessment made under this section shall be governed by Part
X of Article III, except that the limitations on assessment and
collection in section 348 shall not apply.
(c) The department shall issue an assessment under this
section subject to the following limitations:
(1) Within three years of the date the tax credit is
awarded or within three years of the date the tax credit is
sold, whichever is later.
(2) If the taxpayer obtains a tax credit by fraud, the
department may issue an assessment at any time.
Section 1709-A.1. Tax benefit administration.
(a) The department shall have the following powers:
(1) To audit a taxpayer, business firm or other
recipient of a tax benefit.
(2) To issue an assessment against a taxpayer, business
firm or other recipient of a tax benefit if the department
determines that the tax benefit was improperly issued or
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improperly conferred.
(b) The procedures, collection, enforcement and appeals of
any assessment made under this section shall be governed by Part
X of Article III, except that the limitations on assessment and
collection in section 348 shall not apply.
(c) The department shall issue an assessment under this
section subject to the following limitations:
(1) Within three years of the date the tax benefit is
awarded.
(2) If the taxpayer obtains a tax benefit by fraud, the
department may issue an assessment at any time.
Section 1710-A.1. Guidelines.
The department shall develop written guidelines for the
implementation of this article.
Section 5. Sections 1703-B(a) and (c), 1711-B, 1906-F(b) and
1908-F of the act are amended to read:
Section 1703-B. Credit for Research and Development
Expenses.--(a) A taxpayer who incurs Pennsylvania qualified
research and development expense in a taxable year may apply for
a research and development tax credit as provided in this
article. By [September 15] December 1, a taxpayer must submit an
application to the department for Pennsylvania qualified
research and development expense incurred in the taxable year
that ended in the prior calendar year.
* * *
(c) By [December 15] June 1 of the second calendar year
following the close of the taxable year during which the
Pennsylvania qualified research and development expense was
incurred, the department shall notify the taxpayer of the amount
of the taxpayer's research and development tax credit approved
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by the department.
Section 1711-B. Report to General Assembly.--The secretary
shall submit an annual report to the General Assembly indicating
the effectiveness of the credit provided by this article no
later than [March 15] October 1 following the calendar year in
which the credits were approved. The report shall include the
names of all taxpayers utilizing the credit as of the date of
the report and the amount of credits approved and utilized by
each taxpayer. Notwithstanding any law providing for the
confidentiality of tax records, the information contained in the
report shall be public information. The report may also include
any recommendations for changes in the calculation or
administration of the credit.
Section 1906-F. Keystone innovation zone tax credits.
* * *
(b) Application for tax credit.--A KIZ company may file an
application for a tax credit with the department. An application
under this subsection must be filed by [September 15 of each
year for the prior taxable year, beginning September 15, 2006.]
December 1 for the prior tax year. The application must be
submitted on a form required by the department and must be
accompanied by a certification from the KIZ coordinator that the
KIZ company falls within a targeted industry segment identified
in the strategic plan adopted by the KIZ partnership, and meet
any other requirements specified by the department. The
department shall review the application and, upon being
satisfied that all requirements have been met, the department
shall issue a tax credit certificate to the KIZ company. All
certificates shall be awarded by [December 15] June 1 of each
year following the calendar year of application.
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Section 1908-F. Annual report.
The department shall submit an annual report to the Secretary
of the Senate and the Chief Clerk of the House of
Representatives indicating the effectiveness of the keystone
innovation zone tax credit provided by this article by [December
31 of each year, beginning December 31, 2007.] October 1 of each
year following the calendar year of application. Notwithstanding
any law providing for the confidentiality of tax records, the
report shall include the names of all taxpayers awarded the
credits, all taxpayers utilizing the credits, the amount of
credits approved and utilized by each taxpayer and the locations
of the KIZ companies awarded the credits. The report shall be a
public document.
Section 6. This act shall take effect in 60 days.
SECTION 1. THE HEADING OF ARTICLE XVII-A.1 OF THE ACT OF
MARCH 4, 1971 (P.L.6, NO.2), KNOWN AS THE TAX REFORM CODE OF
1971, IS AMENDED TO READ:
ARTICLE XVII-A.1
TAX CREDIT [ELIGIBILITY] AND TAX BENEFIT ADMINISTRATION
SECTION 2. THE DEFINITION OF "TAX CREDIT" IN SECTION 1701-
A.1 OF THE ACT IS AMENDED AND THE SECTION IS AMENDED BY ADDING
DEFINITIONS TO READ:
SECTION 1701-A.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:
"ADMINISTERING AGENCY." A DEPARTMENT, BOARD OR COMMISSION
THAT ADMINISTERS A TAX BENEFIT OR TAX CREDIT AS REQUIRED BY A
LAW OF THIS COMMONWEALTH. THE TERM INCLUDES A KEYSTONE
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INNOVATION ZONE COORDINATOR UNDER ARTICLE XIX-F.
"APPLICANT." A PERSON APPLYING TO AN ADMINISTERING AGENCY
FOR A TAX CREDIT OR A TAX BENEFIT.
"APPLICATION." AN APPLICATION SUBMITTED TO AN ADMINISTERING
AGENCY BY AN APPLICANT FOR A TAX CREDIT OR TAX BENEFIT. THE TERM
INCLUDES A TRANSFER APPLICATION AND SUPPLEMENTAL DOCUMENTATION
REQUIRED TO BE PROVIDED BY AN APPLICANT, INCLUDING REPORTS,
RETURNS AND STATEMENTS.
"BROKER." A PERSON REGISTERED TO ENGAGE IN THE BUSINESS OF
EFFECTUATING TRANSACTIONS IN TAX CREDITS FOR THE ACCOUNT OF
OTHERS, INCLUDING ASSISTING A TAXPAYER TO APPLY FOR, SELL,
TRANSFER, ASSIGN OR PURCHASE A TAX CREDIT. THE TERM INCLUDES AN
ENTITY AND ANY PARTNER, OFFICER, DIRECTOR OR AFFILIATE OF THE
ENTITY OR A PERSON OCCUPYING A SIMILAR STATUS OR PERFORMING
SIMILAR FUNCTIONS FOR THE ENTITY.
* * *
"PERSON." ANY INDIVIDUAL, EMPLOYER, ASSOCIATION, FIDUCIARY,
PARTNERSHIP, CORPORATION, ENTITY, ESTATE OR TRUST, WHETHER A
RESIDENT OR NONRESIDENT OF THIS COMMONWEALTH.
"PROGRAM YEAR." THE ANNUAL PERIOD IN WHICH THE TAX CREDIT OR
TAX BENEFIT OPERATES.
"RECIPIENT." A PERSON WHICH IS SOLD, ASSIGNED OR TRANSFERRED
A TRANSFERRABLE TAX CREDIT.
"TAX BENEFIT." FOR PURPOSES OF THIS ARTICLE, A TAX BENEFIT
AUTHORIZED UNDER ANY OF THE FOLLOWING:
(1) ARTICLE XVII-A.
(2) ARTICLE XVIII-C.
(3) ARTICLE XIX-B.
(4) ARTICLE XIX-D.
(5) ARTICLE XXIX-C.
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(6) ARTICLE XXIX-D.
(7) THE ACT OF OCTOBER 6, 1998 (P.L.705, NO.92), KNOWN
AS THE KEYSTONE OPPORTUNITY ZONE, KEYSTONE OPPORTUNITY
EXPANSION ZONE AND KEYSTONE OPPORTUNITY IMPROVEMENT ZONE ACT.
"TAX CREDIT." A TAX CREDIT AUTHORIZED UNDER ANY OF THE
FOLLOWING:
(1) ARTICLE XVII-B.
(2) ARTICLE XVII-D.
(3) ARTICLE XVII-E.
(4) ARTICLE XVII-G.
(5) ARTICLE XVII-H.
(6) ARTICLE XVII-I.
(7) ARTICLE XVII-J.
(8) ARTICLE XVII-K.
(8.1) ARTICLE XVII-L.
(9) ARTICLE XVIII.
(10) ARTICLE XVIII-B.
(11) ARTICLE XVIII-D.
(12) ARTICLE XVIII-E.
(13) ARTICLE XVIII-F.
(14) ARTICLE XVIII-G.
(14.1) ARTICLE XVIII-H.
(15) ARTICLE XIX-A.
(15.1) ARTICLE XIX-C.
(16) ARTICLE XIX-E.
(16.1) ARTICLE XIX-F.
(17) SECTION 2010.
(18) ARTICLE XXIX-D.
(19) ARTICLE XX-B OF THE ACT OF MARCH 10, 1949 (P.L.30,
NO.14), KNOWN AS THE PUBLIC SCHOOL CODE OF 1949.
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(20) THE ACT OF DECEMBER 1, 2004 (P.L.1750, NO.226),
KNOWN AS THE FIRST CLASS CITIES ECONOMIC DEVELOPMENT DISTRICT
ACT.
(21) 12 PA.C.S. CH. 34 (RELATING TO INFRASTRUCTURE AND
FACILITIES IMPROVEMENT PROGRAM).
(22) ANY OTHER PROGRAM ESTABLISHED BY A LAW OF THIS
COMMONWEALTH IN WHICH A PERSON APPLIES FOR AND RECEIVES A
CREDIT AGAINST A TAX. THIS PARAGRAPH SHALL NOT APPLY TO A
CREDIT AGAINST A TAX LIABILITY AS A RESULT OF AN OVERPAYMENT.
"TAXPAYER." A PERSON WHICH WAS APPROVED FOR A TAX CREDIT OR
TAX BENEFIT OR WHICH OTHERWISE RECEIVED A TAX CREDIT.
"TRANSFER APPLICATION." AN APPLICATION SUBMITTED TO THE
DEPARTMENT OR THE ADMINISTERING AGENCY BY AN APPLICANT OR A
RECIPIENT AS PART OF THE SALE, ASSIGNMENT OR TRANSFER OF A
TRANSFERRABLE TAX CREDIT TO A RECIPIENT.
"TRANSFERRABLE TAX CREDIT." A TAX CREDIT WHICH MAY BE SOLD,
ASSIGNED OR TRANSFERRED FROM AN APPLICANT TO A DIFFERENT
TAXPAYER. THE TERM INCLUDES A TAX CREDIT WHICH MAY BE
TRANSFERRED TO A SHAREHOLDER, MEMBER OR PARTNER OF AN APPLICANT.
SECTION 3. SECTION 1702-A.1 OF THE ACT IS AMENDED TO READ:
SECTION 1702-A.1. [ELIGIBILITY.] DETERMINATION OF ELIGIBILITY
AND METHOD OF SUBMISSION.
(A) TAX REPORTS AND RETURNS.--EXCEPT AS OTHERWISE PROVIDED
BY LAW, BEFORE A TAX CREDIT [CAN] OR TAX BENEFIT MAY BE AWARDED,
THE DEPARTMENT [MAY] OR ADMINISTERING AGENCY, AS APPLICABLE,
SHALL MAKE A FINDING THAT [THE TAXPAYER] AN APPLICANT OR A
RECIPIENT HAS FILED ALL REQUIRED STATE TAX REPORTS AND RETURNS
FOR ALL APPLICABLE TAXABLE YEARS AND PAID ANY BALANCE OF STATE
TAX DUE AS DETERMINED AT SETTLEMENT OR ASSESSMENT BY THE
DEPARTMENT, UNLESS THE TAX DUE IS [CURRENTLY] UNDER APPEAL AT
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THE TIME THE FINDING WAS MADE BY THE DEPARTMENT OR ADMINISTERING
AGENCY.
(B) [(RESERVED).] ELECTRONIC APPLICATIONS.--THE DEPARTMENT
OR ADMINISTERING AGENCY, AS APPLICABLE, MAY REQUIRE AN
APPLICATION FOR A TAX BENEFIT OR TAX CREDIT TO BE FILED
ELECTRONICALLY.
SECTION 4. THE ACT IS AMENDED BY ADDING SECTIONS TO READ:
SECTION 1703-A.1. APPLICATION AND ADMINISTRATION.
(A) INSUFFICIENT APPLICATION.--IF AN ADMINISTERING AGENCY
FINDS THAT AN APPLICATION IS INSUFFICIENT, THE DEPARTMENT, IN
CONSULTATION WITH THE ADMINISTERING AGENCY, MAY DO ALL OF THE
FOLLOWING:
(1) REQUIRE THE SUBMISSION OF ADDITIONAL DOCUMENTATION
OR VERIFICATION WHICH VERIFIES MATERIAL IN THE APPLICATION.
ADDITIONAL DOCUMENTATION OR VERIFICATION REQUIRED UNDER THIS
PARAGRAPH MAY INCLUDE ANY OF THE FOLLOWING:
(I) A COPY OF THE PHOTO IDENTIFICATION OF THE
APPLICANT'S OR RECIPIENT'S CHIEF EXECUTIVE OFFICER AND
AUTHORIZED REPRESENTATIVE RESPONSIBLE FOR SUBMITTING THE
APPLICATION. A COPY OF PHOTO IDENTIFICATION UNDER THIS
SUBPARAGRAPH SHALL INCLUDE THE INDIVIDUAL'S NAME AND
ADDRESS.
(II) BANK ACCOUNT STATEMENTS RELATING TO THE
BUSINESS.
(III) BUSINESS RECORDS, INCLUDING RECEIPTS AND
EXPENDITURES.
(IV) BUSINESS ORIGINATION DOCUMENTS, INCLUDING
ARTICLES OF INCORPORATION, PARTNERSHIP OR REFERENCE TO
DOCUMENTS UNDER THIS SUBPARAGRAPH IN RECORDS OF THE
DEPARTMENT OF STATE OR SIMILAR ENTITY IN ANOTHER
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JURISDICTION.
(V) ANY OTHER INFORMATION REQUIRED BY THE DEPARTMENT
OR ADMINISTERING AGENCY TO VALIDATE THE APPLICATION.
(2) FOR AN APPLICANT WHICH IS NOT AN INDIVIDUAL, REQUIRE
THAT THE APPLICANT OR RECIPIENT MEET FOR A VIRTUAL OR IN-
PERSON INTERVIEW WITH REPRESENTATIVES OR AGENTS OF THE
DEPARTMENT OR THE ADMINISTERING AGENCY TO VERIFY THE
APPLICATION.
(3) FOR AN APPLICANT WHICH IS NOT AN INDIVIDUAL, REQUIRE
THE APPLICANT OR RECIPIENT TO AGREE TO SUBMIT TO SCHEDULED OR
UNSCHEDULED SITE INSPECTIONS BY THE DEPARTMENT, THE
ADMINISTERING AGENCY OR REPRESENTATIVES OR AGENTS OF THE
DEPARTMENT OR ADMINISTERING AGENCY. IF THE SITE IS LOCATED IN
AN AREA WHERE UNSCHEDULED SITE VISITS ARE NOT FEASIBLE, THE
DEPARTMENT OR ADMINISTERING AGENCY SHALL PROVIDE SUFFICIENT
NOTICE PRIOR TO THE VISIT.
(B) RISK CRITERIA.--THE DEPARTMENT AND AN ADMINISTERING
AGENCY MAY JOINTLY DEVELOP RISK SCORING CRITERIA TO DETERMINE
WHEN AN APPLICANT OR RECIPIENT MAY BE REQUIRED TO DO ANY OF THE
FOLLOWING:
(1) AS A CONDITION OF APPROVAL OF THE APPLICATION, TO
HIRE AN INDEPENDENT AUDITOR TO PREPARE AUDITED FINANCIAL
STATEMENTS. THE INDEPENDENT AUDITOR UNDER THIS PARAGRAPH
SHALL BE A CERTIFIED PUBLIC ACCOUNTANT.
(2) PROVIDE INFORMATION WHICH SHALL BE INCLUDED IN THE
AUDITED FINANCIAL STATEMENTS UNDER PARAGRAPH (1).
(3) REQUIRE THE AUDITED FINANCIAL STATEMENTS UNDER
PARAGRAPH (1) TO BE SUBMITTED TO THE DEPARTMENT.
(C) REPORTS.--AN APPLICANT WHICH IS APPROVED FOR A TAX
CREDIT OR TAX BENEFIT SHALL FILE AN ANNUAL REPORT WITH THE
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DEPARTMENT OR ADMINISTERING AGENCY DETAILING ALL OF THE
FOLLOWING:
(1) FOR A TRANSFERRABLE TAX CREDIT, ALL OF THE
FOLLOWING:
(I) WHETHER THE APPLICANT USED, SOLD, ASSIGNED OR
TRANSFERRED A PORTION OR ALL OF THE TAX CREDIT IN THE
PRIOR PROGRAM YEAR.
(II) WHETHER THE TAX CREDIT WAS SOLD, ASSIGNED OR
TRANSFERRED FOR CONSIDERATION IN THE PRIOR PROGRAM YEAR
AND THE NAME OF THE RECIPIENT.
(III) IF THE TAX CREDIT WAS SOLD, ASSIGNED OR
TRANSFERRED FOR CONSIDERATION, THE AMOUNT OF THE
CONSIDERATION.
(IV) IF THE TAX CREDIT WAS SOLD, ASSIGNED OR
TRANSFERRED FOR CONSIDERATION, WHETHER THE SALE,
ASSIGNMENT OR TRANSFER WAS CONDUCTED WITH THE ASSISTANCE
OF A BROKER AND THE NAME AND REGISTRATION NUMBER OF THE
BROKER.
(2) IF APPLICABLE, AN ITEMIZATION OF EXPENSES, INCOME
AND JOBS GENERATED AS A RESULT OF THE RECEIPT OF THE TAX
CREDIT OR TAX BENEFIT.
(3) ANY OTHER INFORMATION THAT THE DEPARTMENT OR
ADMINISTERING AGENCY DEEMS NECESSARY.
(D) SUBMISSION OF DATA.--THE DEPARTMENT OR ADMINISTERING
AGENCY SHALL PROVIDE THE INFORMATION SUBMITTED UNDER SUBSECTION
(C)(2) TO THE INDEPENDENT FISCAL OFFICE FOR USE IN PREPARING A
TAX CREDIT REPORT UNDER SECTION 5 OF THE ACT OF OCTOBER 30, 2017
(P.L.797, NO.48), KNOWN AS THE PERFORMANCE-BASED BUDGETING AND
TAX CREDIT EFFICIENCY ACT.
SECTION 1704-A.1. ASSESSMENT.
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(A) AUTHORIZATION.--THE DEPARTMENT MAY ISSUE AN ASSESSMENT
AGAINST A TAXPAYER IF THE DEPARTMENT DETERMINES THAT A TAX
CREDIT OR TAX BENEFIT WAS IMPROPERLY ISSUED OR THE BENEFITS OF
THE TAX CREDIT OR TAX BENEFIT WERE IMPROPERLY CONFERRED.
(B) LIABILITY FOR ASSESSMENT.--IF A TAX CREDIT IS SOLD,
TRANSFERRED OR ASSIGNED TO A BONA FIDE PURCHASER FOR
CONSIDERATION, THE DEPARTMENT MAY ONLY ISSUE AN ASSESSMENT UNDER
SUBSECTION (A) AGAINST THE PERSON SELLING THE TAX CREDIT AND THE
BROKER WHICH SIGNED THE CERTIFICATION REQUIRED BY SECTION 1706-
A.1(G). A SELLER AND BROKER UNDER THIS SUBSECTION SHALL BE
JOINTLY AND SEVERALLY LIABLE FOR THE AMOUNT DUE.
(C) PROCEDURES.--THE PROCEDURES, COLLECTION, ENFORCEMENT AND
APPEALS OF AN ASSESSMENT MADE UNDER SUBSECTION (A) SHALL BE
SUBJECT TO PART X OF ARTICLE III, EXCEPT THAT THE LIMITATIONS ON
ASSESSMENT AND COLLECTION UNDER SECTION 348 SHALL NOT APPLY.
(D) LIMITATIONS.--
(1) EXCEPT AS PROVIDED UNDER PARAGRAPH (2), THE
DEPARTMENT MUST ISSUE AN ASSESSMENT UNDER SUBSECTION (A)
WITHIN THREE YEARS OF THE DATE THE TAX CREDIT OR TAX BENEFIT
IS AWARDED OR WITHIN THREE YEARS OF THE DATE THE TAX CREDIT
IS SOLD, TRANSFERRED OR ASSIGNED, WHICHEVER IS LATER.
(2) IF A TAXPAYER OBTAINS A TAX CREDIT OR TAX BENEFIT BY
FRAUD, THE DEPARTMENT MAY ISSUE AN ASSESSMENT UNDER
SUBSECTION (A) AT ANY TIME.
SECTION 1705-A.1. ADMINISTERING AGENCY TRAINING.
(A) TRAINING.--AN ADMINISTERING AGENCY SHALL PROVIDE AGENCY
EMPLOYEES AND REPRESENTATIVES AND AGENTS OF THE ADMINISTERING
AGENCY WHO ASSIST APPLICANTS WITH APPLICATIONS WITH TRAINING ON
ALL OF THE FOLLOWING:
(1) THE REQUIREMENTS FOR A TAX CREDIT OR TAX BENEFIT.
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(2) ADVISING AN APPLICANT THAT HAS BEEN ISSUED A TAX
CREDIT OR TAX BENEFIT OF THE DUTY OF THE BUSINESS TO FILE
REPORTS CONCERNING USE OF THE TAX CREDIT OR TAX BENEFIT AS
REQUIRED BY THE LAWS OF THIS COMMONWEALTH.
(3) CONDUCTING ONSITE VISITS TO VERIFY COMPLIANCE WITH
THE REQUIREMENTS RELATING TO APPLICATION FOR AND ISSUANCE OF
A TAX CREDIT OR TAX BENEFIT.
(4) CONDUCTING SCHEDULED AND UNSCHEDULED VISITS TO THE
SITE OF A TAXPAYER TO ENSURE COMPLIANCE WITH THE REQUIREMENTS
OF THE TAX CREDIT OR TAX BENEFIT.
(B) (RESERVED).
SECTION 1706-A.1. BROKER REGISTRATION.
(A) REGISTRATION REQUIRED.--A BROKER SHALL BE REGISTERED
WITH THE DEPARTMENT UNDER THIS SECTION. AN AGENT OR OTHER PARTY
REPRESENTING A BROKER OR ASSISTING A BROKER ON BEHALF OF AN
APPLICANT EXECUTING AN APPLICATION FOR, PURCHASE OF OR SALE OF A
TAX CREDIT SHALL REGISTER UNDER THIS SECTION.
(B) GUIDELINES.--THE DEPARTMENT, IN CONSULTATION WITH THE
DEPARTMENT OF COMMUNITY AND ECONOMIC DEVELOPMENT, SHALL
ESTABLISH GUIDELINES PROVIDING FOR THE APPLICATION AND
REGISTRATION OF A BROKER UNDER THIS SECTION. THE GUIDELINES
SHALL REQUIRE ALL OF THE FOLLOWING:
(1) THE NAME AND ADDRESS OF THE BROKER SHOWING THAT THE
BROKER RESIDES IN THIS COMMONWEALTH.
(2) THE NAME AND ADDRESS OF THE BUSINESS WITH WHICH THE
BROKER IS EMPLOYED OR OTHERWISE ASSOCIATED THAT IS LOCATED IN
THIS COMMONWEALTH.
(3) THAT THE BROKER BE AT LEAST 18 YEARS OF AGE.
(4) THE MINIMUM EDUCATIONAL REQUIREMENTS, QUALIFICATIONS
AND EXPERIENCE NECESSARY FOR THE ISSUANCE OF A REGISTRATION
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UNDER THIS SECTION.
(5) A CRIMINAL BACKGROUND CHECK PREPARED BY THE
PENNSYLVANIA STATE POLICE THAT DEMONSTRATES THE BROKER HAS
NOT BEEN CONVICTED OF A FELONY OFFENSE OR AN OFFENSE THAT
INVOLVED FRAUD OR MISREPRESENTATION IN THIS COMMONWEALTH OR
ANY OTHER JURISDICTION.
(6) A LIST OF EACH PROFESSIONAL LICENSE THAT HAS BEEN
ISSUED TO THE BROKER AND WHETHER THE BROKER IS IN GOOD
STANDING WITH THE LICENSING AUTHORITY.
(7) VERIFICATION THAT THE APPLICATION IS SUBMITTED IN
ACCORDANCE WITH 18 PA.C.S. §§ 4903 (RELATING TO FALSE
SWEARING) AND 4904 (RELATING TO UNSWORN FALSIFICATION TO
AUTHORITIES).
(8) PAYMENT OF ANY REQUIRED APPLICATION, LICENSING AND
REGISTRATION FEES.
(9) TAX CLEARANCE SHOWING SATISFACTION OF ALL STATE AND
LOCAL TAXES.
(C) APPLICATIONS.--A BROKER SHALL OBTAIN AN INITIAL OR
RENEWED REGISTRATION BY FILING AN APPLICATION WITH THE
DEPARTMENT, PROVIDING INFORMATION AND DOCUMENTATION AND PAYING
ALL FEES AS REQUIRED BY THE DEPARTMENT.
(D) DURATION OF REGISTRATION.--A REGISTRATION UNDER THIS
SECTION SHALL BE VALID FOR A PERIOD OF TWO YEARS FROM THE DATE
OF ISSUANCE.
(E) REGISTRATION NUMBER.--A REGISTRATION UNDER THIS SECTION
SHALL INCLUDE A UNIQUE REGISTRATION NUMBER FOR THE REGISTRANT. A
REGISTRATION UNDER THIS SECTION MAY BE SUSPENDED OR REVOKED BY
THE DEPARTMENT FOR GOOD CAUSE.
(F) APPEALS.--A BROKER WHO IS DENIED A REGISTRATION UNDER
THIS SECTION, OR WHOSE REGISTRATION IS SUSPENDED OR REVOKED, MAY
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APPEAL THE DEPARTMENT'S DETERMINATION IN THE SAME MANNER AS
PROVIDED BY ARTICLE XXVII.
(G) ATTACHMENT OF CERTIFICATION.--A BROKER EXECUTING THE
SALE OF A TAX CREDIT OR ASSISTING AN APPLICANT OR A TAXPAYER TO
APPLY FOR OR PURCHASE A TAX CREDIT SHALL ATTACH A CERTIFICATION
TO THE APPLICATION THAT THE STATEMENTS AND REPRESENTATIONS MADE
IN THE APPLICATION ARE TRUE AND CORRECT AND SUBJECT TO THE
PENALTIES AS SET FORTH IN 18 PA.C.S. § 4903 OR 4904. THE BROKER
SHALL INCLUDE THE BROKER'S UNIQUE REGISTRATION NUMBER ISSUED BY
THE DEPARTMENT IN THE CERTIFICATION UNDER THIS SECTION.
(H) FEES.--THE DEPARTMENT MAY REQUIRE THE PAYMENT OF AN
APPLICATION FEE TO REVIEW AND PROCESS A REGISTRATION UNDER THIS
SECTION.
(I) PENALTIES.--A PERSON WHO VIOLATES THE REQUIREMENTS
SPECIFIED UNDER THIS SECTION SHALL PAY A CIVIL FINE OF $25,000
FOR THE FIRST OFFENSE AND $50,000 FOR EACH ADDITIONAL OFFENSE TO
THE DEPARTMENT.
(J) BOND REQUIRED.--A BROKER REGISTERED UNDER THIS SECTION
SHALL POST A BOND OF $50,000 WITH THE DEPARTMENT.
SECTION 1707-A.1. TAX CREDIT AND TAX BENEFIT REPORTS.
(A) REPORTS.--NOTWITHSTANDING ANY LAW PROVIDING FOR THE
CONFIDENTIALITY OF TAX CREDITS, BEGINNING WITH THE FIRST PROGRAM
YEAR WHICH BEGINS AFTER THE EFFECTIVE DATE OF THIS SECTION AND
EACH PROGRAM YEAR THEREAFTER, THE ADMINISTERING AGENCY SHALL
PUBLISH A REPORT FOR EACH TAX CREDIT OR TAX BENEFIT, WHICH SHALL
INCLUDE THE FOLLOWING INFORMATION:
(1) THE NAME OF EACH APPLICANT WHICH RECEIVED A TAX
CREDIT OR TAX BENEFIT IN THE PRIOR PROGRAM YEAR. FOR A TAX
CREDIT, THE AMOUNT OF TAX CREDIT AWARDED TO EACH APPLICANT.
(2) FOR A TAX CREDIT, WHETHER AN APPLICANT UNDER
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PARAGRAPH (1) SOLD, ASSIGNED OR TRANSFERRED A TAX CREDIT IN
THE PRIOR PROGRAM YEAR.
(3) IF APPLICABLE, A SUMMARY OF THE DATA SUBMITTED UNDER
SECTION 1703-A.1(C)(2).
(4) IF AVAILABLE, ALL OF THE FOLLOWING:
(I) THE NAME OF THE RECIPIENT TO WHICH THE TAX
CREDIT UNDER PARAGRAPH (2) WAS SOLD, ASSIGNED OR
TRANSFERRED IN THE PRIOR PROGRAM YEAR. THE NAME OF AN
INDIVIDUAL RECEIVING A TAX CREDIT WITHOUT CONSIDERATION
FROM A PASS-THROUGH ENTITY IN WHICH THE INDIVIDUAL IS A
SHAREHOLDER, MEMBER OR PARTNER SHALL NOT BE PUBLISHED.
(II) THE AMOUNT OF TAX CREDIT UNDER PARAGRAPH (2)
THAT WAS SOLD, ASSIGNED OR TRANSFERRED IN THE PRIOR
PROGRAM YEAR.
(III) THE PRICE FOR WHICH A TAX CREDIT UNDER
PARAGRAPH (2) WAS SOLD, ASSIGNED OR TRANSFERRED.
(B) PUBLICATION.--
(1) EXCEPT AS PROVIDED UNDER PARAGRAPH (2), AN
ADMINISTERING AGENCY SHALL PUBLISH A REPORT UNDER SUBSECTION
(A) ON THE ADMINISTERING AGENCY'S PUBLICLY AVAILABLE INTERNET
WEBSITE NO LATER THAN 45 DAYS AFTER THE END OF A PROGRAM
YEAR.
(2) IF AN ADMINISTERING AGENCY IS REQUIRED BY A LAW OF
THIS COMMONWEALTH TO PREPARE AN ANNUAL REPORT ON THE TAX
CREDIT OR TAX BENEFIT, THE INFORMATION UNDER SUBSECTION (A)
SHALL BE INCLUDED IN THE ANNUAL REPORT REQUIRED BY THE LAW OF
THIS COMMONWEALTH.
SECTION 1708-A.1. ALLOCATION OF TAX CREDITS OR TAX BENEFITS
AWARDED UPON APPEAL.
(A) APPEAL.--IF AN ADMINISTERING AGENCY DENIES AN
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APPLICANT'S APPLICATION FOR A TAX CREDIT OR TAX BENEFIT PROGRAM,
THE APPLICANT MAY APPEAL THE ADMINISTERING AGENCY'S
DETERMINATION IN THE SAME MANNER AS PROVIDED BY ARTICLE XXVII.
(B) AWARDING OF TAX CREDIT OR TAX BENEFIT UPON APPEAL.-- THE
FOLLOWING SHALL APPLY TO AN ALLOCATION OF TAX CREDITS AWARDED
UPON THE FINAL RESOLUTION OF AN APPEAL:
(1) IF AN APPLICANT IS AWARDED A TAX CREDIT WHICH IS
SUBJECT TO A TOTAL ANNUAL LIMITATION, UPON THE FINAL
RESOLUTION OF AN APPEAL AFTER THE FULL ALLOCATION OF CREDITS
AVAILABLE FOR A FISCAL YEAR IS COMPLETELY EXPENDED, THE
ADMINISTERING AGENCY SHALL INCLUDE THE AWARDED TAX CREDIT
WITHIN THE DISTRIBUTION OF TAX CREDITS IN THE NEXT PROGRAM
YEAR AFTER THE RESOLUTION OF THE APPEAL FOR WHICH AN AMOUNT
FOR ALLOCATION IS AVAILABLE.
(2) WHEN AWARDING A TAX CREDIT TO AN APPLICANT UNDER
PARAGRAPH (1), THE ADMINISTERING AGENCY SHALL APPLY ANY
REDUCTION IN THE AWARDED TAX CREDIT AMOUNT AS WAS APPLIED IN
THE PROGRAM YEAR FOR WHICH THE CREDIT WAS DENIED IF THE
REDUCTION WAS APPLIED DUE TO THE TOTAL CREDITS APPLIED FOR
EXCEEDING THE AMOUNT OF CREDITS ALLOCATED FOR THE PROGRAM
YEAR.
(3) WHEN AWARDING A TAX CREDIT TO AN APPLICANT UNDER
PARAGRAPH (1), THE ADMINISTERING AGENCY SHALL REDUCE THE
TOTAL AMOUNT OF CREDITS AVAILABLE FOR ALLOCATION IN THE NEXT
PROGRAM YEAR BY THE AMOUNT OF CREDITS AWARDED.
(4) THE AWARDED TAX CREDITS UNDER PARAGRAPH (1) SHALL
APPLY FOR THE PROGRAM YEAR IN WHICH THE CREDIT WAS DENIED.
(C) APPEAL.--IF THE DEPARTMENT OF COMMUNITY AND ECONOMIC
DEVELOPMENT DENIES AN APPLICANT'S APPLICATION FOR A TAX CREDIT
OR TAX BENEFIT PROGRAM, THE APPLICANT MAY APPEAL IN A MANNER
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ESTABLISHED BY THE DEPARTMENT OF COMMUNITY AND ECONOMIC
DEVELOPMENT.
(D) DEFINITION.--AS USED IN THIS SECTION, THE TERM
"ADMINISTERING AGENCY" SHALL EXCLUDE THE DEPARTMENT OF COMMUNITY
AND ECONOMIC DEVELOPMENT.
SECTION 1709-A.1. GUIDELINES.
THE DEPARTMENT SHALL DEVELOP WRITTEN GUIDELINES FOR THE
IMPLEMENTATION OF THIS ARTICLE.
SECTION 5. SECTIONS 1703-B(A) AND (C), 1704-B(A) AND (B),
1711-B, 1906-F(B) AND (D) AND 1908-F OF THE ACT ARE AMENDED TO
READ:
SECTION 1703-B. CREDIT FOR RESEARCH AND DEVELOPMENT
EXPENSES.--(A) A TAXPAYER WHO INCURS PENNSYLVANIA QUALIFIED
RESEARCH AND DEVELOPMENT EXPENSE IN A TAXABLE YEAR MAY APPLY FOR
A RESEARCH AND DEVELOPMENT TAX CREDIT AS PROVIDED IN THIS
ARTICLE. BY [SEPTEMBER 15] NOVEMBER 1, A TAXPAYER MUST SUBMIT AN
APPLICATION TO THE DEPARTMENT FOR PENNSYLVANIA QUALIFIED
RESEARCH AND DEVELOPMENT EXPENSE INCURRED IN THE TAXABLE YEAR
THAT ENDED IN THE PRIOR CALENDAR YEAR.
* * *
(C) BY [DECEMBER 15 OF THE] MAY 1 OF THE SECOND CALENDAR
YEAR FOLLOWING THE CLOSE OF THE TAXABLE YEAR DURING WHICH THE
PENNSYLVANIA QUALIFIED RESEARCH AND DEVELOPMENT EXPENSE WAS
INCURRED, THE DEPARTMENT SHALL NOTIFY THE TAXPAYER OF THE AMOUNT
OF THE TAXPAYER'S RESEARCH AND DEVELOPMENT TAX CREDIT APPROVED
BY THE DEPARTMENT.
SECTION 1704-B. CARRYOVER, CARRYBACK, REFUND AND ASSIGNMENT
OF CREDIT.--(A) IF THE TAXPAYER CANNOT USE THE ENTIRE AMOUNT OF
THE RESEARCH AND DEVELOPMENT TAX CREDIT FOR THE FIRST TAXABLE
YEAR IN WHICH THE TAXPAYER APPLIED FOR A RESEARCH AND
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DEVELOPMENT TAX CREDIT [IS FIRST APPROVED], THEN THE EXCESS MAY
BE CARRIED OVER TO SUCCEEDING TAXABLE YEARS AND USED AS A CREDIT
AGAINST THE QUALIFIED TAX LIABILITY OF THE TAXPAYER FOR THOSE
TAXABLE YEARS. EACH TIME THAT THE RESEARCH AND DEVELOPMENT TAX
CREDIT IS CARRIED OVER TO A SUCCEEDING TAXABLE YEAR, IT IS TO BE
REDUCED BY THE AMOUNT THAT WAS USED AS A CREDIT DURING THE
IMMEDIATELY PRECEDING TAXABLE YEAR. THE RESEARCH AND DEVELOPMENT
TAX CREDIT PROVIDED BY THIS ARTICLE MAY BE CARRIED OVER AND
APPLIED TO SUCCEEDING TAXABLE YEARS FOR NO MORE THAN FIFTEEN
TAXABLE YEARS FOLLOWING THE FIRST TAXABLE YEAR FOR WHICH THE
TAXPAYER WAS ENTITLED TO CLAIM THE CREDIT.
(B) A RESEARCH AND DEVELOPMENT TAX CREDIT APPROVED BY THE
DEPARTMENT FOR PENNSYLVANIA QUALIFIED RESEARCH AND DEVELOPMENT
EXPENSE IN A TAXABLE YEAR FIRST SHALL BE APPLIED AGAINST THE
TAXPAYER'S QUALIFIED TAX LIABILITY FOR THE CURRENT TAXABLE YEAR
AS OF THE DATE ON WHICH THE [CREDIT WAS APPROVED] TAXPAYER
APPLIED FOR THE CREDIT BEFORE THE RESEARCH AND DEVELOPMENT TAX
CREDIT IS APPLIED AGAINST ANY TAX LIABILITY UNDER SUBSECTION
(A).
* * *
SECTION 1711-B. REPORT TO GENERAL ASSEMBLY.--THE SECRETARY
SHALL SUBMIT AN ANNUAL REPORT TO THE GENERAL ASSEMBLY INDICATING
THE EFFECTIVENESS OF THE CREDIT PROVIDED BY THIS ARTICLE NO
LATER THAN [MARCH 15 FOLLOWING THE] OCTOBER 1 FOLLOWING THE
CALENDAR YEAR IN WHICH THE CREDITS WERE APPROVED. THE REPORT
SHALL INCLUDE THE NAMES OF ALL TAXPAYERS UTILIZING THE CREDIT AS
OF THE DATE OF THE REPORT AND THE AMOUNT OF CREDITS APPROVED AND
UTILIZED BY EACH TAXPAYER. NOTWITHSTANDING ANY LAW PROVIDING FOR
THE CONFIDENTIALITY OF TAX RECORDS, THE INFORMATION CONTAINED IN
THE REPORT SHALL BE PUBLIC INFORMATION. THE REPORT MAY ALSO
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INCLUDE ANY RECOMMENDATIONS FOR CHANGES IN THE CALCULATION OR
ADMINISTRATION OF THE CREDIT.
SECTION 1906-F. KEYSTONE INNOVATION ZONE TAX CREDITS.
* * *
(B) APPLICATION FOR TAX CREDIT.--A KIZ COMPANY MAY FILE AN
APPLICATION FOR A TAX CREDIT WITH THE DEPARTMENT. AN APPLICATION
UNDER THIS SUBSECTION MUST BE FILED BY [SEPTEMBER