PRINTER'S NO. 1835
No. 1462 Session of 2003
INTRODUCED BY PETRONE, LEVDANSKY, FAIRCHILD, PAYNE, THOMAS,
LEACH, BELFANTI, GOODMAN, BROWNE, STABACK, DALEY, LEDERER,
MANN, LaGROTTA, McGEEHAN, LESCOVITZ, BELARDI, COY, DeWEESE,
McILHATTAN, McCALL, WALKO, SOLOBAY, READSHAW, BARRAR, MELIO,
HARHAI, PISTELLA, DeLUCA, KOTIK, LAUGHLIN, CAWLEY,
WASHINGTON, HORSEY, JAMES, SAINATO, KIRKLAND, CORRIGAN,
CREIGHTON, CAPPELLI, HENNESSEY, GEIST, BUNT AND GRUCELA,
MAY 14, 2003
REFERRED TO COMMITTEE ON FINANCE, MAY 14, 2003
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," providing for a charitable volunteer tax credit.
11 The General Assembly of the Commonwealth of Pennsylvania
12 hereby enacts as follows:
13 Section 1. The act of March 4, 1971 (P.L.6, No.2), known as
14 the Tax Reform Code of 1971, is amended by adding an article to
15 read:
16 ARTICLE XIX-B
17 CHARITABLE VOLUNTEER TAX CREDIT
18 Section 1901-B. Short title.
19 This article shall be known and may be cited as the
1 Charitable Volunteer Tax Credit Law.
2 Section 1902-B. Legislative intent.
3 It is the intent of the General Assembly to encourage
4 business firms to provide employee volunteers for charitable
5 purposes in the community during work hours.
6 Section 1903-B. Definitions.
7 The following words and phrases when used in this article
8 shall have the meanings given to them in this section unless the
9 context clearly indicates otherwise:
10 "Business firm." A business entity authorized to do business
11 in this Commonwealth and subject to taxes imposed by Article IV,
12 VI, VII, VII-A, VIII, VIII-A, IX, X or XV.
13 "Charitable purpose." Any one or combination of the
14 following purposes:
15 (1) Relief of poverty.
16 (2) Advancement and provision of education, including
17 postsecondary education.
18 (3) Advancement of religion.
19 (4) Prevention and treatment of disease or injury,
20 including mental retardation and mental disorders.
21 (5) Government or municipal purpose.
22 (6) Accomplishment of a purpose which is recognized as
23 important and beneficial to the public and which advances
24 social, moral or physical objectives.
25 "Department." The Department of Community and Economic
26 Development of the Commonwealth.
27 "Qualified tax liability." The liability for taxes imposed
28 under Article IV, VI, VII, VII-A, VIII, VIII-A, IX, X or XV. The
29 term shall not include any taxes withheld from the compensation
30 of an employee pursuant to section 316.
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1 "Secretary." The Secretary of Community and Economic
2 Development of the Commonwealth.
3 Section 1904-B. Allowance of charitable volunteer tax credit.
4 A business firm that allows its employees to leave their
5 regular performance of duties for the purpose of volunteering
6 services for a charitable purpose may apply for a tax credit
7 under section 1906-B.
8 Section 1905-B. Determination of charitable volunteer tax
9 credit.
10 (a) Determination.--The secretary shall determine the
11 charitable volunteer tax credit based upon the amount of time
12 that a business firm permits its employees to leave their
13 regular performance of duties for the purpose of volunteering
14 services for a charitable purpose during the taxable year. The
15 department shall not grant a tax credit to a business firm for
16 activities that are a part of its normal course of business. The
17 following tax credits shall apply to the hours volunteered per
18 employee in the taxable year:
19 Time Volunteered Tax Credit
20 A minimum of 25 hours up
21 to 49 hours per taxable year. $250 per employee
22 A minimum of 50 hours up
23 to 74 hours per taxable year. $500 per employee
24 A minimum of 75 hours up
25 to 99 hours per taxable year. $750 per employee
26 A minimum of 100 hours up
27 to 124 hours per taxable year. $1,000 per employee
28 A minimum of 125 hours
29 per taxable year. $1,250 per employee
30 (b) Grant.--The Department of Revenue shall grant a tax
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1 credit approved by the secretary under this article against any
2 qualified tax liability of a business firm. A business firm may
3 not utilize credit in a taxable year which exceeds 50% of its
4 qualified tax liability for the taxable year.
5 (c) Total.--The total amount of credits awarded under this
6 article shall not exceed $20,000,000 in any fiscal year.
7 (d) Calculations of allocation.--If the total amount of
8 charitable volunteer tax credits applied for by qualified
9 business firms under this article exceeds $20,000,000 in a
10 fiscal year then the credit to be received by each business firm
11 shall be the product of $20,000,000 multiplied by a quotient
12 that equals the credit applied for by the business firm divided
13 by the total of all credits applied for by all business firms.
14 Section 1906-B. Application for tax credit.
15 Business firms must file applications with the department in
16 a manner provided for by the department for tax credits based on
17 the amount of time volunteered by employees during the taxable
18 year.
19 Section 1907-B. Grant of tax credit.
20 The department shall notify each business firm that has filed
21 a complete application for tax credit under this article the
22 amount of the credit, if any, awarded to the business firm. The
23 secretary may promulgate rules and regulations regarding the
24 approval or disapproval of applications by business firms. The
25 decision of the secretary to approve or disapprove an
26 application for tax credit under this article shall be in
27 writing, and, if approved, the application shall state the
28 maximum credit allowable to the business firm. The secretary
29 shall transmit a copy of the decision to the Secretary of
30 Revenue.
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1 Section 1908-B. Carryover and carryback of credit.
2 (a) Carryover.--The tax credit may be carried over to
3 succeeding taxable years as provided in this section and used as
4 a credit against qualified tax liability otherwise due and
5 payable to the taxpayer during those taxable years, except that
6 the total amount of credit used in any tax year may not exceed
7 50% of the qualified tax liability for that taxable year. A
8 business firm may carry forward to the next three succeeding
9 taxable years any tax credit not used in the period that it
10 contributed employee volunteer time.
11 (b) Prohibitions.--A taxpayer may not carryback or receive a
12 refund of any unused credit.
13 Section 1909-B. Report to General Assembly.
14 Within five months after the close of any fiscal year during
15 which tax credits granted under this article are used, the
16 department shall furnish to the members of the General Assembly
17 an annual report that lists business firms that used credits
18 during the preceding fiscal year under this article, their
19 corresponding address, standard industrial classification code
20 and the amount of tax credits granted. The provisions of section
21 408(b) and any other provision of law preventing the disclosure
22 of information required shall not apply when the information is
23 divulged for the purposes of this section.
24 Section 1910-B. Expiration.
25 (a) Termination.--This article shall terminate five years
26 from the effective date of this article.
27 (b) Report.--The Legislative Budget and Finance Committee
28 shall present to the General Assembly a report evaluating this
29 article not less than 120 days before the termination date. The
30 report shall recommend whether this article should continue and
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1 if so, any changes suggested by the committee to improve the
2 operation of this article.
3 Section 1911-B. Applicability.
4 Any tax credit granted under this article shall apply against
5 qualified tax liabilities for taxable years beginning after
6 December 31, 2003.
7 Section 2. This act shall take effect in 60 days.
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