PRINTER'S NO. 1905
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
1686
Session of
2021
INTRODUCED BY THOMAS AND FARRY, JUNE 23, 2021
REFERRED TO COMMITTEE ON FINANCE, JUNE 23, 2021
AN ACT
Providing for process for petition for refund of tax
overpayment, for form of petition for refund of tax
overpayment, for submission of petition for refund of tax
overpayment, for refund of tax overpayment, for time period
for refund of tax overpayment and for jurisdiction; and
imposing penalties.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Short title.
This act shall be known and may be cited as the Refund of Tax
Overpayment in Cities of the First Class Act.
Section 2. Definitions.
The following words and phrases when used in this act shall
have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Date of receipt." The date a petition is postmarked or
received by a city of the first class, whichever comes first.
"Overpayment." A payment of qualified tax which is
determined not to be legally due in accordance with this act,
which shall be equal to the rate of qualified tax multiplied by
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the total sum of salaries, wages, commissions and other
compensation paid to a qualified taxpayer from an employer
located in a city of the first class for work or services
rendered during the applicable taxable year, multiplied by the
quotient of the number of days the qualified taxpayer was
subject to a remote work arrangement, divided by the total
number of days worked by the qualified taxpayer during the
applicable taxable year.
"Petition." The petition for a refund of a qualifying tax
under section 3.
"Qualified taxpayer." A nonresident of a city of the first
class subject to a qualifying tax.
"Qualifying tax." A tax imposed on the wages of a
nonresident of a city of the first class under the act of August
5, 1932 (Sp.Sess., P.L.45, No.45), referred to as the Sterling
Act.
"Remote work arrangement." An arrangement, whether written
or verbal, between an employer and a qualified taxpayer whereby
the employer permits or requires the qualified taxpayer to work
outside of a city of the first class.
Section 3. Process for petition for refund of tax overpayment.
Notwithstanding the act of August 5, 1932 (Sp.Sess., P.L.45,
No.45), referred to as the Sterling Act, a city of the first
class shall establish immediately upon the effective date of
this section, by ordinance or resolution, a process by which a
qualified taxpayer may file a petition for a refund of an
overpayment of qualifying tax.
Section 4. Form of petition for refund of tax overpayment.
A city of the first class shall develop and make available a
form by which a qualified taxpayer may petition for a refund
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under section 3. The form shall include a space for attestation
by the qualified taxpayer, which shall reference the potential
penalty for unsworn falsification to authorities which may be
imposed under 18 Pa.C.S. ยง 4904 (relating to unsworn
falsification to authorities).
Section 5. Submission of petition for refund of tax
overpayment.
To receive a refund of an overpayment of qualifying tax, a
qualified taxpayer shall submit a petition for a refund to the
city of the first class, which shall include an attestation that
the qualified taxpayer was subject to a remote work arrangement
during the time period for which a refund is sought.
Section 6. Refund of tax overpayment.
Upon receipt of a completed petition for refund and
attestation by the qualified taxpayer, a city of the first class
shall issue a refund of an overpayment of qualifying tax.
Section 7. Time period for refund of tax overpayment.
A refund shall be issued within 30 days of the date of
receipt of a completed petition.
Section 8. Penalties.
If a refund is not issued by a city of the first class within
30 days of the date of receipt of a completed petition, for each
day thereafter, the following shall be added to the amount of
overpayment of qualified tax due to the qualified taxpayer:
(1) Interest at a rate in accordance with the rate
established under section 806 of the act of April 9, 1929
(P.L.343, No.176), known as The Fiscal Code.
(2) A penalty at a rate of 5% of the overpayment of
qualified tax.
Section 9. Jurisdiction.
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An appeal by a qualified taxpayer of a denial of a petition
for refund under this act shall be heard by the Philadelphia
Municipal Court as established under 42 Pa.C.S. Ch. 11 Subch. B
(relating to Philadelphia Municipal Court).
Section 10. Construction.
The following shall apply:
(1) A petition filed by a qualified taxpayer and
awaiting a decision by the city of the first class as of the
effective date of this section shall be governed by sections
3 and 4.
(2) A petition filed by a qualified taxpayer that has
been denied for a refund of an overpayment of qualified tax
by the city of the first class prior to the effective date of
this section shall be eligible to resubmit a petition in
accordance with this act.
Section 11. Applicability.
This act shall apply to taxable years beginning after
December 31, 2019.
Section 12. Effective date.
This act shall take effect in 60 days.
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