Bill Text: PA HB1178 | 2009-2010 | Regular Session | Introduced

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Bill Title: Further providing, in personal income tax, for classes of income.

Spectrum: Slight Partisan Bill (Republican 22-8)

Status: (Introduced - Dead) 2009-04-03 - Referred to FINANCE [HB1178 Detail]

Download: Pennsylvania-2009-HB1178-Introduced.html

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PRINTER'S NO. 1407
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No. 1178 Session of2009
INTRODUCED BY HENNESSEY, BRENNAN, CREIGHTON, GEIST, GILLESPIE, GINGRICH, GOODMAN, GROVE, HESS, KILLION, PALLONE, PICKETT, QUINN, RAPP, READSHAW, REICHLEY, ROHRER, ROSS, SCAVELLO, SIPTROTH, SONNEY, STERN, SWANGER, TURZAI, VULAKOVICH, WANSACZ, YOUNGBLOOD, YUDICHAK AND GALLOWAY, APRIL 3, 2009
REFERRED TO COMMITTEE ON FINANCE, APRIL 3, 2009
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," further providing, in personal income tax, for
classes of income.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Section 303(a.7) of the act of March 4, 1971
(P.L.6, No.2), known as the Tax Reform Code of 1971, added July
6, 2006 (P.L.319, No.67), is amended to read:
Section 303. Classes of Income.--(a) The classes of income
referred to above are as follows:
* * *
(a.7) The following apply:
(1) An amount paid as a contribution into a qualified
tuition program shall be deductible from taxable income on the
annual personal income tax return. The amount paid as a
contribution to a qualified tuition program allowable as a
deduction under this subsection shall be subject to an annual
limitation not to exceed the threshold for exclusion from gifts
as provided in section 2503(b) of the Internal Revenue Code of
1986, as amended, per designated beneficiary. The deduction
shall not result in taxable income being less than zero. If the
aggregate amount of contributions during the calendar year by a
donor exceeds the limitation for that year under section 2503(b)
of the Internal Revenue Code of 1986, as amended, the aggregate
amount shall, at the election of the donor, be taken into
account for purposes of that section ratably over the five-year
period beginning with that calendar year.
(2) (i) The following shall not be subject to tax under
this article:
(A) Any amount distributed from a qualified tuition program
that is excludable from tax under section 529(c)(3)(B) of the
Internal Revenue Code of 1986, as amended.
(B) Any rollover that is excludable from tax under section
529(c)(3)(C) of the Internal Revenue Code of 1986, as amended.
(C) Undistributed earnings on a qualified tuition program.
(ii) A change in designated beneficiaries under section
529(c)(3)(C) of the Internal Revenue Code of 1986, as amended,
shall not constitute a taxable event under this article.
(3) Any amount distributed from a qualified tuition program
that is not described under paragraph (2) shall be taxable under
this article.
(4) For purposes of this subsection:
(i) The term "designated beneficiary" shall have the same
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meaning as provided in section 529(e)(1) of the Internal Revenue
Code of 1986, as amended.
(ii) The term "qualified tuition program" shall have the
same meaning as provided in section 529(b)(1) of the Internal
Revenue Code of 1986, as amended.
* * *
Section 2. This act shall take effect immediately.
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