THE GENERAL ASSEMBLY OF PENNSYLVANIA

SENATE BILL

INTRODUCED BY McILHINNEY, RAFFERTY, GREENLEAF, COSTA, WASHINGTON, TOMLINSON, ERICKSON, ALLOWAY AND M. WHITE, MARCH 14, 2011

REFERRED TO FINANCE, MARCH 14, 2011  

AN ACT

Providing for a State tax credit for personal contributions to

certain charitable organizations that provide assistance to

the working poor.

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 Pennsylvania

Charity Tax Credit 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:

"Department."  The Department of Revenue of the Commonwealth.

"Low-income residents."  Persons whose household income is

less than 150% of the Federal poverty level.

"Qualifying charitable organization."  A charitable

organization that is exempt from Federal income taxation under

section 501(c)(3) of the Internal Revenue Code of 1986 (Public

Law 99-514, 26 U.S.C § 501(c)(3)), or is a designated community

action agency that receives community services block grant

program moneys pursuant to 42 U.S.C. § 9901 (relating to

purposes and goals). The organization must spend at least 50% of

its budget on services to residents of this Commonwealth who

receive temporary assistance for needy families' benefits or on

low-income residents of this Commonwealth and their households.

Taxpayers choosing to make donations through an umbrella

charitable organization that collects donations on behalf of

member charities shall designate that the donation be directed

to a member charitable organization that would qualify under

this section on a stand-alone basis.

"Services."  Cash assistance, medical care, child care, food,

clothing, shelter, job placement and job training services or

any other assistance that is reasonably necessary to meet

immediate basic needs and that is provided and used in this

Commonwealth.

Section 3.  Authorization of credit.

(a)  Credit.--For taxable years beginning after December 31,

2011, a credit is allowed against the taxes imposed by the

Commonwealth for voluntary cash contributions made by the

taxpayer during the taxable year to a qualifying charitable

organization as determined pursuant to, but not exceeding, the

following:

(1)  Two hundred dollars in any taxable year for a single

individual or a head of household.

(2)  Four hundred dollars for a married couple filing a

joint return.

(3)  A husband and wife who file separate returns for a

taxable year in which they could have filed a joint return

may each claim only one-half of the tax credit that would

have been allowed for a joint return.

(b)  Carry forward.--If the allowable tax credit exceeds the

taxes otherwise due the Commonwealth on the claimant's income,

or if there are no taxes due the Commonwealth, the taxpayer may

carry forward the amount of the claim not used to offset the

taxes for not more than five consecutive taxable years' income

tax liability.

(c)  Limitations.--The credit allowed under this section is

in lieu of a deduction pursuant to section 170 of the Internal

Revenue Code of 1986 (Public Law 99-514, 26 U.S.C. § 170) and

taken for State tax purposes.

(d)  Requirements.--Taxpayers taking a credit authorized

under this section shall provide the name of the qualifying

charitable organization and the amount of the contribution to

the department on forms provided by the department.

(e)  Additional limitations.--The credit under this section

applies only to contributions to qualifying charitable

organizations that exceed the total amount deducted pursuant to

section 170 of the Internal Revenue Code of 1986 in the

taxpayer's baseline year. The taxpayer's baseline year is:

(1)  The 2010 taxable year if the taxpayer deducted

charitable contributions pursuant to section 170 of the

Internal Revenue Code of 1986 in the 2010 taxable year.

(2)  If the taxpayer did not deduct charitable

contributions pursuant to section 170 of the Internal Revenue

Code of 1986 in the 2010 taxable year, the taxpayer's

baseline year is the first taxable year after 2010 that the

taxpayer deducted charitable contributions pursuant to

section 170 of the Internal Revenue Code of 1986.

(f)  Certification.--A qualifying charitable organization

shall provide the department with a written certification that

it meets all criteria to be considered a qualifying charitable

organization. The organization shall also notify the department

of any changes that may affect the organization's qualifications

under this section. The department shall compile and make

available to the public a list of the qualifying organizations.

Section 4.  Effective date.

This act shall take effect in 60 days.