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HOUSE AMENDED
A08927
THE GENERAL ASSEMBLY OF PENNSYLVANIA
SENATE BILL
No.
653
Session of
2017
INTRODUCED BY BROWNE, BOSCOLA, FOLMER, McGARRIGLE, BARTOLOTTA,
SCAVELLO, REGAN, EICHELBERGER, WILLIAMS, LAUGHLIN, MARTIN,
WAGNER AND SCHWANK, MAY 24, 2017
AS REPORTED FROM COMMITTEE ON LOCAL GOVERNMENT, HOUSE OF
REPRESENTATIVES, AS AMENDED, JUNE 21, 2018
AN ACT
Amending the act of December 31, 1965 (P.L.1257, No.511),
entitled "An act empowering cities of the second class,
cities of the second class A, cities of the third class,
boroughs, towns, townships of the first class, townships of
the second class, school districts of the second class,
school districts of the third class and school districts of
the fourth class including independent school districts, to
levy, assess, collect or to provide for the levying,
assessment and collection of certain taxes subject to maximum
limitations for general revenue purposes; authorizing the
establishment of bureaus and the appointment and compensation
of officers, agencies and employes to assess and collect such
taxes; providing for joint collection of certain taxes,
prescribing certain definitions and other provisions for
taxes levied and assessed upon earned income, providing for
annual audits and for collection of delinquent taxes, and
permitting and requiring penalties to be imposed and
enforced, including penalties for disclosure of confidential
information, providing an appeal from the ordinance or
resolution levying such taxes to the court of quarter
sessions and to the Supreme Court and Superior Court," in
local taxes, further providing for collection; in
consolidated collection of local income taxes, further
providing for tax collection committees, for declaration and
payment of income taxes and for powers and duties of tax
officer; in collection of delinquent taxes, further providing
for costs of collection; and making a related editorial
change.
The General Assembly of the Commonwealth of Pennsylvania
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hereby enacts as follows:
Section 1. Section 313(a), Chapter 5 heading and section
505(a), (a.1), (b), (c), (j) and (l) of the act of December 31,
1965 (P.L.1257, No.511), known as The Local Tax Enabling Act,
are amended to read:
Section 1. Section 313(a) and Chapter 5 of the act of
December 31, 1965 (P.L.1257, No.511), known as The Local Tax
Enabling Act, are amended to read:
Section 313. Collection of Taxes.--(a) Administrative
Personnel; Joint Agreements.--
(1) Except as provided in section 506 and subject to the
provisions of section 509, any political subdivision is hereby
authorized to provide by ordinance or resolution for the
creation or designation of tax bureaus or the appointment and
compensation of a political subdivision, public employe, tax
bureau or public or private agency for the assessment and
collection of taxes imposed under authority of this chapter.
Each ordinance or resolution under this section authorizing a
political subdivision, public employe, tax bureau or public or
private agency to act in the capacity and with the authority of
a tax collector shall continue in force without annual
reauthorization unless otherwise repealed or revoked by the
political subdivision or unless otherwise provided by this act.
(2) Except as provided in section 506 and subject to the
provisions of section 509, political subdivisions imposing taxes
under authority of this chapter are authorized to make joint
agreements for the collection of such taxes or any of them. The
same political subdivision, tax bureau or public or private
agency may be employed by two or more political subdivisions to
collect any taxes imposed by them under authority of this
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chapter.
* * *
CHAPTER 5
CONSOLIDATED COLLECTION OF LOCAL [INCOME] TAXES
Section 1.1. Sections 502(c)(2) and (3) and (e) and 505(a),
(a.1), (b), (c), (j) and (l) of the act, amended May 4, 2018
(P.L.102, No.18), are amended to read:
Section 502. Declaration and payment of income taxes.
* * *
(c) Declaration and payment.--Except as provided in
subsections (a)(2) and (d), taxpayers shall declare and pay
income taxes as follows:
* * *
(2) (i) Every taxpayer making net profits resulting in
a tax liability of $200 or more shall, by April 15 of the
current year, make and file with the resident tax officer
a declaration of the taxpayer's estimated net profits
during the period beginning January 1 and ending December
31 of the current year, and shall pay to the resident tax
officer in four equal quarterly installments the tax due
on the estimated net profits. The first installment shall
be paid at the time of filing the declaration, and the
other installments shall be paid on or before July 15 of
the current year, October 15 of the current year and
January 15 of the succeeding year, respectively. For a
declaration of an estimated tax on net profits resulting
in a tax liability that is less than $200, a taxpayer may
remit one lump sum payment to the resident tax officer
without penalty and shall not be required to file
quarterly estimates.
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(ii) Any taxpayer who first anticipates any net
profit resulting in a tax liability of $200 or more after
April 15 of the current year shall make and file the
declaration required on or before July 15 of the current
year, October 15 of the current year or January 15 of the
succeeding year, whichever date next follows the date on
which the taxpayer first anticipates such net profit, and
shall pay to the resident tax officer in equal
installments the tax due on or before the quarterly
payment dates that remain after the filing of the
declaration.
(iii) Every taxpayer shall, on or before April 15 of
the succeeding year, make and file with the resident tax
officer a final return showing the amount of net profits
resulting in a tax liability of $200 or more that was
earned or received based on the method of accounting used
by the taxpayer during the period beginning January 1 of
the current year, and ending December 31 of the current
year, the total amount of tax due on the net profits and
the total amount of tax paid. At the time of filing the
final return, the taxpayer shall pay to the resident tax
officer the balance of tax due or shall make demand for
refund or credit in the case of overpayment. Any taxpayer
may, in lieu of paying the fourth quarterly installment
of the estimated tax, elect to make and file with the
resident tax officer on or before January 31 of the
succeeding year, the final return.
(iv) The department, in consultation with the
Department of Revenue, shall provide by regulation for
the filing of adjusted declarations of estimated net
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profits and for the payments of the estimated tax in
cases where a taxpayer who has filed the declaration
required under this subsection anticipates additional net
profits not previously declared or has overestimated
anticipated net profits.
(v) Every taxpayer who discontinues business prior
to December 31 of the current year, shall, within 30 days
after the discontinuance of business, file a final return
as required under this paragraph and pay the tax due.
(3) Every taxpayer who receives any other taxable income
not subject to withholding under section 512(3) resulting in
a tax liability of $200 or more shall make and file with the
resident tax officer a quarterly return on or before April 15
of the current year, July 15 of the current year, October 15
of the current year, and January 15 of the succeeding year,
setting forth the aggregate amount of taxable income not
subject to withholding by the taxpayer during the three-month
periods ending March 31 of the current year, June 30 of the
current year, September 30 of the current year, and December
31 of the current year, respectively, and subject to income
tax, together with such other information as the department
may require. Every taxpayer [filing] that is required to file
a return shall, at the time of filing the return, pay to the
resident tax officer the amount of income tax due. The
department shall establish criteria under which the tax
officer may waive the quarterly return and payment of the
income tax and permit a taxpayer to file the receipt of
taxable income on the taxpayer's annual return and pay the
income tax due on or before April 15 of the succeeding year.
* * *
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(e) Restrictions.--In administering the provisions of this
section, no political subdivision, tax collection committee or
tax officer may:
(1) Prohibit a taxpayer from filing any return or
declaration required under this section in person or by first
class mail.
(2) Prohibit a taxpayer from filing any local income tax
return form, estimated tax return form or other form related
to any filing required under this section that has been
posted by the department on its publicly accessible Internet
website.
(3) Impose a penalty for failing to timely file a
quarterly estimated tax return for which no payment of
estimated tax was due, as shown in the taxpayer's annual
income tax return.
(4) Impose a penalty on a taxpayer unless it has issued
a letter that notifies the taxpayer that the taxpayer is
required to take corrective action within 30 days and failure
to take corrective action will result in a penalty being
imposed on the taxpayer.
(5) Require a taxpayer to file a local tax return
indicating that the taxpayer earned zero income or does not
owe any local tax to the local taxing jurisdiction if the
taxpayer met the local income tax exemption requirements and
was not required to file a local income tax return in the
preceding year.
Section 505. Tax collection committees.
(a) General rule.--Subject to the provisions of subsection
(m) and section 509(k), each tax collection district shall be
governed by a tax collection committee constituted and operated
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as set forth in this section. Meetings of the tax collection
committee shall be conducted under 65 Pa.C.S. Ch. 7 (relating to
open meetings) and the act of June 21, 1957 (P.L.390, No.212),
referred to as the Right-to-Know Law.
(a.1) Duties.--A tax collection committee has the following
duties:
(1) To keep records of all votes and other actions taken
by the tax collection committee.
(2) To appoint and oversee a tax officer for the tax
collection district as provided in section 507(a).
(3) To set the compensation of the tax officer under
section 507(c).
(4) To require, hold, set and review the tax officer's
bond required by section 509(d).
(5) To establish the manner and extent of financing of
the tax collection committee.
(6) To adopt, amend and repeal bylaws for the management
of its affairs consistent with subsection (f) and regulations
under section 508.
(7) To adopt, amend and repeal policies and procedures
consistent with the regulations under section 508 for the
administration of [income] taxes under section 509 within the
tax collection district. The procedures shall supersede any
contrary resolutions or ordinances adopted by a political
subdivision. This authority shall not be construed to permit
a tax collection committee to change the rate or subject of
any tax.
* * *
(b) Delegates.--
(1) The governing body of each political subdivision
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within a tax collection district that imposed an income tax
prior to July 1, 2009, shall appoint one voting delegate and
one or more alternates to represent the political subdivision
on the tax collection committee by September 15, 2009. The
governing body of each political subdivision that after June
30, 2009, imposes [an income] a tax [for the first time]
under section 509 shall appoint one voting delegate and one
or more alternates to represent the political subdivision on
the tax collection committee. A voting delegate or alternate
shall serve at the pleasure of the governing body of the
political subdivision.
(2) The governing body of each political subdivision
within a tax collection district that prior to July 1, 2009,
does not impose an income tax may appoint one nonvoting
delegate and one or more alternates to represent the
political subdivision on the tax collection committee. If,
after June 30, 2009, the political subdivision imposes [an
income] a tax under section 509, the nonvoting delegate shall
become a voting delegate to represent the political
subdivision on the tax collection committee.
* * *
(c) Voting rights.--
(1) Only a delegate appointed by the governing body of a
political subdivision may represent a political subdivision
at a tax collection committee meeting. If a delegate cannot
be present for a tax collection committee meeting, the
alternate appointed under this section may represent the
political subdivision. Each delegate or alternate shall be
entitled to vote upon any action authorized or required of
the tax collection committee under this chapter.
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(2) For the first meeting of the tax collection
committee, actions of the tax collection committee shall be
determined by a majority vote of those delegates present.
Votes shall be weighted among the governing bodies of the
member political subdivisions according to the following
formula: 50% shall be allocated according to the proportional
population of each political subdivision in proportion to the
population of each tax collection district as determined by
the most recent Federal decennial census data and 50% shall
be weighted in direct proportion to [income] tax revenues
collected in each political subdivision, based on each
political subdivision's most recent annual financial report
submitted to the department or the Department of Education.
For subsequent meetings, votes shall be taken in accordance
with this paragraph unless the bylaws provide otherwise.
(3) No later than September 1, 2009, the department
shall calculate the weighted vote for each political
subdivision within each tax collection district based on the
formula specified in paragraph (2). By July 1 of the year
following the first meeting, and of each year thereafter,
each tax collection committee shall recalculate the weighted
vote unless the bylaws provide for a more frequent
recalculation.
(4) If a political subdivision within the tax collection
district imposes [an income] a tax under section 509 for the
first time, the tax collection committee shall recalculate
the weighted vote or other method of voting under the bylaws.
* * *
(j) Appeals board.--
(1) By June 1, 2010, each tax collection committee shall
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establish an appeals board comprised of a minimum of three
delegates or, in the case of a tax collection committee
established pursuant to subsection (m), a minimum of three
residents of the county.
(2) A determination of the tax officer relating to the
assessment, collection, refund, withholding, remittance or
distribution of [income] taxes enacted under this act may be
appealed to the appeals board by a taxpayer, employer,
political subdivision or another tax collection district. An
appeals board established under this section shall be the
appropriate venue for any appeal of the following:
(i) Any tax provided for under this act, except a
tax upon the transfer of real property or an interest in
real property.
(ii) A tax levied on payroll amounts generated as a
result of business activity as authorized by this act or
any other act.
(3) All appeals, other than those brought under
subsection (k), shall be conducted in a manner consistent
with 53 Pa.C.S. §§ 8431 (relating to petitions), 8432
(relating to practice and procedure), 8433 (relating to
decisions), 8434 (relating to appeals) and 8435 (relating to
equitable and legal principles to apply).
(3.1) When an appeal is filed in the manner prescribed
by a tax collection committee, a copy of the appeal shall be
concurrently filed with the taxing jurisdiction named in the
appeal.
(4) A tax collection committee may enter into an
agreement with another tax collection committee to establish
a joint appeals board.
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(5) No member of an appeals board or joint appeals board
may be a tax officer or an employee, agent or attorney for a
tax officer.
(6) An appeals board appointed pursuant to this section
shall constitute a joint local tax appeals board as provided
for in 53 Pa.C.S. § 8430 (relating to administrative appeals)
for purposes of taxes collected under the supervision of the
appointing tax collection committee.
* * *
(l) Annual budget required.--
(1) Each tax collection committee shall adopt an annual
budget providing for compensation of the tax officer and
other expenses of operating the tax collection district.
(2) The expenses of operating the tax collection
district shall be shared among and paid by all political
subdivisions within the tax collection district that are
represented by voting delegates on the tax collection
committee and shall be weighted in direct proportion to
[income] tax revenues collected in each participating
political subdivision based on the political subdivision's
most recent annual audit report required under this section.
* * *
Section 2. Section 509(k) of the act is amended and the
section is amended by adding a subsection to read:
Section 509. Powers and duties of tax officer.
* * *
(k) Collection.--In addition to the powers and duties
enumerated in this section, a tax officer:
(1) no later than January 1, 2020, shall collect each
THE LOCAL SERVICES tax which is authorized under section
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301.1 except a tax upon the transfer of real property or an
interest in real property and a tax levied on payroll amounts
generated as a result of business activity as authorized by
this act or any other act ; and
(2) when designated by the tax collection committee, [a
tax officer] may collect other taxes levied pursuant to [this
act,] the act of June 27, 2006 (1st Sp.Sess., P.L.1873,
No.1), known as the Taxpayer Relief Act, or other statutory
law[.], except taxes excluded from collection under paragraph
(1).
(k.1) Exception.--Notwithstanding subsection (k), a
political subdivision may retain its tax collection authority
over a mercantile or business privilege tax by resolution
adopted not less than 90 days prior to the effective date of
subsection (k)(1).
(K.1) EXCEPTION.--
(1) THE TAX COLLECTION COMMITTEE SHALL NOTIFY IN WRITING
EVERY POLITICAL SUBDIVISION AND THE ELECTED TAX COLLECTOR
WITHIN THE POLITICAL SUBDIVISION'S JURISDICTION 120 DAYS
PRIOR TO JANUARY 1, 2020, THAT THE POLITICAL SUBDIVISION MAY
RETAIN THE POLITICAL SUBDIVISION'S TAX COLLECTION AUTHORITY
OVER A LOCAL SERVICES TAX, BY ADOPTING A RESOLUTION NOT LESS
THAN 90 DAYS PRIOR TO THE EFFECTIVE DATE OF THIS SUBSECTION.
(2) IF AT ANYTIME AFTER A TAX OFFICER BEGINS COLLECTING
A LOCAL SERVICES TAX AS AUTHORIZED BY SUBSECTION (K)(1) ON
BEHALF OF A POLITICAL SUBDIVISION, AND THE POLITICAL
SUBDIVISION WISHES TO REGAIN THE POLITICAL SUBDIVISION'S
AUTHORITY TO COLLECT A LOCAL SERVICES TAX, THE POLITICAL
SUBDIVISION SHALL PASS A RESOLUTION NOT LESS THAN 90 DAYS
BEFORE JANUARY 1 OF THE FOLLOWING YEAR INFORMING THE TAX
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COLLECTION COMMITTEE OF THE POLITICAL SUBDIVISION'S INTENT TO
RESUME COLLECTION OF THE LOCAL SERVICES TAX.
(3) IF AT ANY TIME A POLITICAL SUBDIVISION HAS OPTED OUT
OF HAVING THE TAX OFFICER COLLECT THE LOCAL SERVICES TAX AS
AUTHORIZED BY SUBSECTION (K)(1), AND THE POLITICAL
SUBDIVISION WISHES TO DELEGATE THE POLITICAL SUBDIVISION'S
AUTHORITY TO COLLECT THE LOCAL SERVICES TAX AS AUTHORIZED BY
SUBSECTION (K)(1), THE POLITICAL SUBDIVISION SHALL PASS A
RESOLUTION NOT LESS THAN 90 DAYS BEFORE JANUARY 1 OF THE
FOLLOWING YEAR INFORMING THE TAX COLLECTION COMMITTEE THAT
THE POLITICAL SUBDIVISION DELEGATES COLLECTION AUTHORITY OF
THE LOCAL SERVICES TAX TO THE TAX COLLECTION COMMITTEE.
Section 3. Section 707 heading of the act is amended to
read:
Section 707. Costs of Collection of Delinquent Per Capita,
Occupation, Occupational Privilege, Emergency and Municipal
Services, Local Services [and], Income and Payroll Taxes.--* * *
Section 4. Nothing in this act shall be construed to
terminate or modify the terms of a contract in effect on the
effective date of this section for the term of that contract
unless otherwise agreed to in writing by the parties to the
contract.
Section 5. This act shall take effect January 1, 2020, or
immediately, whichever is later.
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