Bill Text: PA HB2674 | 2009-2010 | Regular Session | Introduced

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Bill Title: Providing for a Commonwealth Small Business Job Creation Tax Credit.

Spectrum: Moderate Partisan Bill (Democrat 24-4)

Status: (Introduced - Dead) 2010-08-26 - Referred to FINANCE [HB2674 Detail]

Download: Pennsylvania-2009-HB2674-Introduced.html

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PRINTER'S NO. 4160
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No. 2674 Session of2010
INTRODUCED BY PALLONE, BELFANTI, BRADFORD, BRIGGS, CARROLL, DePASQUALE, FAIRCHILD, FREEMAN, GALLOWAY, GEORGE, GOODMAN, HARHAI, HORNAMAN, JOSEPHS, KOTIK, KULA, MANN, McILVAINE SMITH, MURT, PASHINSKI, PAYTON, PRESTON, READSHAW, REESE, SIPTROTH, M. SMITH, SOLOBAY AND SWANGER, AUGUST 26, 2010
REFERRED TO COMMITTEE ON FINANCE, AUGUST 26, 2010
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," providing for a Commonwealth Small Business Job
Creation Tax Credit.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. The act of March 4, 1971 (P.L.6, No.2), known as
the Tax Reform Code of 1971, is amended by adding an article to
read:
ARTICLE XVIII-E
COMMONWEALTH SMALL BUSINESS
JOB CREATION TAX CREDITS
Section 1801-E. 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:
"Department." The Department of Community and Economic
Development of the Commonwealth.
"Employee." An individual who is a citizen or lawful
resident of the United States who receives wages, remuneration,
compensation or tips from a qualified employer for work
performed within this Commonwealth.
"Qualified employer." Any employer other than the United
States, any state or any instrumentality thereof or any state or
local authority that employs full-time employees within this
Commonwealth.
"Qualified payroll." The amount of all wages, as defined in
section 4(x) of the act of December 5, 1936 (1937 2nd Sp.Sess.,
P.L.2897, No.1), known as the Unemployment Compensation Law,
paid or incurred by a qualified employer to the employees of
such employer.
"Qualified payroll increase." The amount, if any, by which a
qualified employer's qualified payroll for a quarter exceeds the
qualified payroll for the quarter of the calendar year preceding
the year in which the qualified quarter falls.
"Qualified quarter." The calendar quarter which includes the
effective date of this section and each of the three calendar
quarters immediately following such quarter.
"Qualified tax liability." The liability for taxes imposed
under Article III, IV, VI, VII, VIII, IX, XI or XV. The term
includes the liability for taxes imposed under Article III on
the owner or owners of a pass-through entity. The term does not
include amounts withheld or required to be withheld from
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employees under Article III.
"Tax credit." A Commonwealth Small Business Job Creation Tax
Credit granted by the Department of Revenue under this article.
"Transition quarter." A qualified quarter with respect to
which the qualified payroll increase cannot be determined under
section 1802-E(g) solely because the employer was not in
existence during the quarter of the calendar year preceding the
year in which the qualified quarter falls.
Section 1802-E. Commonwealth Small Business Job Creation Tax
Credit.
(a) Establishment of credit.--The Department of Revenue
shall grant a tax credit against a qualified employer's
qualified tax liability for each qualified quarter in an amount
equal to the credit amount.
(b) Calculation of credit amount.--For purposes of this
section, the credit amount with respect to any qualified quarter
is equal to the applicable percentage of the qualified payroll
increase of the employer for the qualified quarter.
(c) Applicable percentage.--For purposes of subsection (b),
the applicable percentage with respect to any qualified quarter
is:
(1) in the case of an employer that employs 100 or fewer
employees during such quarter, 20%; and
(2) in the case of an employer that employs more than
100 employees during such quarter, 15%.
(d) Dollar limitation.--The total credit amount with respect
to the tax credit any employer shall receive for each new
employee hired during a qualified quarter shall not exceed
$1,250 per new employee.
(e) Carryover and carryback.--Any tax credit not used in the
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period the tax credit was earned may be carried over for the
next three succeeding years until the full credit has been
allowed. An employer shall not be entitled to carry back or
obtain a refund of an unused tax credit.
(f) Maintenance of base employment requirement.--This
section shall not apply to any qualified employer for any
qualified quarter if the total number of employees of the
employer during the quarter is less than the total number of
employees during the quarter preceding such quarter, determined
by not taking into account any employee who is a seasonal
employee during the preceding quarter.
(g) New employers.--
(1) In the case of a qualified employer which comes into
existence after the effective date of this section and before
January 1, 2012:
(i) the term qualified quarter refers to:
(A) the first calendar quarter for which the
qualified employer is in existence; and
(B) each of the three quarters following that
quarter.
(ii) the qualified payroll increase of the employer
for the quarter described in subparagraph (i)(A) shall be
equal to the amount of the employer's qualified payroll
for that quarter; and
(iii) the qualified payroll increase of the employer
for any quarter described in subparagraph (i)(B) shall be
the amount, if any, by which the employer's qualified
payroll for the quarter exceeds the qualified payroll of
the quarter preceding that quarter.
(2) In the case of a qualified employer which comes into
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existence after the last day of the calendar quarter which is
five calendar quarters before the effective date of this
section but before the effective date of this section, the
qualified payroll increase of the employer for any transition
quarter shall be the amount, if any, by which the employer's
qualified payroll for the quarter exceeds the qualified
payroll of the quarter preceding that quarter.
Section 1803-E. Duties of department.
(a) Regulations.--The department shall promulgate
regulations with regard to application for and enforcement of
this article, including, but not limited to, acceptable forms
and proof of jobs created.
(b) Investigation and report on enforcement actions.--Not
later than six months after the effective date of this section,
and quarterly thereafter, the department shall submit a report
to the Finance Committee of the Senate and the Finance Committee
of the House of Representatives on the enforcement measures
taken to prevent and penalize fraud related to this article,
including the following:
(1) General statistics related to the application of
this article.
(2) Cases of fraud.
(3) The status of investigatory and enforcement or
prosecutorial actions related to cases of fraud.
Section 1804-E. Publication of recipient employers.
The department shall publish and update as necessary a list
of qualified employers that receive a tax credit on the publicly
accessible Internet website of the department.
Section 2. This act shall take effect in 60 days.
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