PRINTER'S NO. 4372
No. 2837 Session of 2004
INTRODUCED BY KENNEY, SEPTEMBER 17, 2004
REFERRED TO COMMITTEE ON FINANCE, SEPTEMBER 17, 2004
AN ACT
1 Amending the act of July 5, 2004 (P.L.654, No.72), entitled "An
2 act providing for taxation by school districts, for State
3 funds and for wage and net profits tax relief in cities of
4 the first class; and making an appropriation," further
5 providing for the reduction of wage taxes in cities of the
6 first class; and providing for senior citizen real property
7 tax rebates in cities of the first class.
8 The General Assembly of the Commonwealth of Pennsylvania
9 hereby enacts as follows:
10 Section 1. Section 505(d) of the act of July 5, 2004
11 (P.L.654, No.72), known as the Homeowner Tax Relief Act, is
12 amended and the section is amended by adding a subsection to
13 read:
14 Section 505. State property tax reduction allocation.
15 * * *
16 (d) Reduction of wage taxes in a city of the first class.--A
17 city council of a city of the first class shall reduce any tax
18 imposed on the wages of residents and nonresidents under the
19 authority of the act of August 5, 1932 (Sp.Sess., P.L.45,
20 No.45), referred to as the Sterling Act, in a manner consistent
1 with Chapter 7 and in accordance with the following:
2 (1) For residents, by an amount equal to two-thirds of
3 the amount of the property tax reduction allocation received
4 from the Commonwealth pursuant to subsection (b) in an amount
5 not to exceed the limitations set forth in subsection
6 (a)(3)(iii) had such limitations applied.
7 (2) For nonresidents, by any amount equal to two-thirds
8 of the amount of the property tax reduction allocation
9 received from the Commonwealth pursuant to subsection (b) in
10 excess of the limitations set forth in subsection (a)(3)(iii)
11 had such limitations applied.
12 (3) If the certification under section 503(a)(1)(i) is
13 less than $750,000,000, the tax reductions under paragraphs
14 (1) and (2) shall be a pro rata share of the property tax
15 reduction allocation to a school district of the first class
16 calculated under subsection (a) at $750,000,000.
17 (e) Senior citizen real property tax rebate funding.--A city
18 council of a city of the first class shall rebate real property
19 taxes imposed on senior citizen homesteads in a manner
20 consistent with Chapter 7 and in accordance with the following:
21 (1) By an amount equal to one-third of the amount of the
22 property tax reduction allocation received from the
23 Commonwealth pursuant to subsection (b) in an amount not to
24 exceed the limitations set forth in subsection (a)(3)(iii)
25 had such limitations applied.
26 (2) By an amount equal to one-third of the amount of the
27 property tax reduction allocation received from the
28 Commonwealth pursuant to subsection (b) in excess of the
29 limitations set forth in subsection (a)(3)(iii) had such
30 limitations applied.
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1 (3) If the certification under section 503(a)(1)(i) is
2 less than $750,000,000, the tax reductions under paragraphs
3 (1) and (2) shall be a pro rata share of the property tax
4 reduction allocation to a school district of the first class
5 calculated under subsection (a) at $750,000,000.
6 Section 2. The act is amended by adding a section to read:
7 Section 705. Senior citizen real property tax rebate in cities
8 of the first class.
9 (a) Eligibility.--For each calendar year in which a payment
10 under section 505(b) is made, a senior citizen taxpayer shall be
11 entitled pursuant to this section to receive a rebate of real
12 property taxes paid to a city of the first class on the senior
13 citizen's homestead in the prior calendar year.
14 (b) Amount of rebate.--The rebate shall be calculated as an
15 equal dollar amount for each senior citizen homestead consistent
16 with the following:
17 (1) The total amount rebated shall be the total of the
18 amounts calculated under section 505(e).
19 (2) The senior citizen homesteads eligible for the
20 rebate shall be those homesteads for which applications have
21 been timely submitted and approved by the city of the first
22 class.
23 (c) Application.--Any person desiring to receive the rebate
24 under this section shall notify the city of the first class
25 granting the rebate in writing on a form provided by it
26 submitted at the time provided by ordinance. Only one taxpayer
27 for each homestead shall be entitled to the rebate. If two or
28 more persons residing at any homestead meet the qualification
29 for a rebate they may determine among themselves who shall
30 receive the rebate. If they are unable to agree, the city of the
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1 first class shall determine to whom the rebate is to apply.
2 (d) Proof of claim.--The first application filed shall
3 include proof that the taxpayer or the taxpayer's spouse is or
4 will be 65 years of age or older during the calendar year in
5 which the application is filed. The first application and
6 subsequent applications shall include reasonable proof of the
7 location and nature of the property claimed as a homestead and a
8 receipt for the real estate taxes paid with respect to the
9 homestead. It shall not be necessary that real estate taxes are
10 paid directly by the taxpayer.
11 (e) Partial year ownership.--If a homestead is owned by a
12 senior citizen for only a portion of a year, the city of the
13 first class shall apportion the real estate taxes in accordance
14 with the period or portion of ownership of the eligible taxpayer
15 in determining the amount of rebate for which a taxpayer is
16 eligible.
17 (f) Administration and enforcement.--A city of the first
18 class shall provide by ordinance, rule or regulation for the
19 administration and enforcement of the rebate provided by this
20 section.
21 (g) Interaction with other rebates.--The rebate provided
22 under this section shall be reduced by the amount of any rebate
23 to which the homeowner is entitled under section 704. The
24 Department of Revenue of the Commonwealth and a city of the
25 first class shall be authorized to exchange any information
26 necessary to implement this subsection.
27 (h) Definitions.--For the purpose of this section, the
28 following words and phrases shall have the meanings given to
29 them in this subsection unless the context clearly indicates
30 otherwise:
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1 "Homestead." A dwelling used as a home, occupied by a
2 taxpayer as a primary residence. The term includes, but is not
3 limited to, mobile homes which are assessed as realty for local
4 property tax purposes and the land upon which the mobile home is
5 situated and other similar living accommodations as well as a
6 part of a multidwelling or multipurpose building and a part of
7 the land upon which it is built to the extent that the taxpayer
8 is chargeable by a city of the first class for property taxes.
9 The term also includes, but is not limited to, premises occupied
10 by a taxpayer if he is required by law to pay a property tax by
11 reason of his ownership or rental of, including a possessory
12 interest in, the dwelling, the land or both. The term "by law"
13 shall not be deemed to include a contractual obligation between
14 the taxpayer and a person who would otherwise be responsible to
15 a city of the first class for the payment of the tax. An owner
16 includes a person in possession under contract of sale, deed of
17 trust, life estate, joint tenancy or tenancy in common.
18 "Rebate." The senior citizen property tax rebate provided
19 under this section.
20 "Senior citizen." A taxpayer who is 65 years of age or
21 older, or whose spouse, if a member of the household, is 65
22 years of age or older, during a calendar year in which real
23 property taxes are due and payable or was a widow or widower of
24 someone who was 65 years of age or older and was 50 years of age
25 or older during a calendar year or part thereof in which real
26 estate taxes were due and payable. The term "widow" or "widower"
27 shall mean the surviving wife or the surviving husband, as the
28 case may be, of a deceased individual who has not remarried.
29 Section 3. This act shall take effect immediately.
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