§ 19-3205. Conditions for Real Estate Tax Exemption. 663

   (1)   A resident of real property located in the Zone, other than in the Economic Development District and Strategic Development Area, shall not be entitled to an abatement of real estate taxes on such property unless such resident invests in improvements to the real property an amount equal to no less than twenty-five percent (25%) of all real property taxes which would have been due if the real property was not located in the Zone. 664

   (2)   A nonresident owner of real property located in the Zone, other than in the Economic Development District and Strategic Development Area, who leases such property directly or indirectly to a person for residential use shall not be entitled to an abatement of real estate taxes on such property unless such nonresident owner invests in improvements to the real property no less than fifty percent (50%) of all real property taxes which would have been due if the real property was not located in the Zone. 665

   (3)   Application deadlines.

      (a)   Any taxpayer requesting a real estate tax abatement pursuant to this Chapter shall notify the Board of Revision of Taxes in writing on a form provided by the Board of Revision of Taxes within 30 days of the designation of the Zone by DCED or within 30 days of the transfer of ownership of the real property subject to abatement. A copy of the abatement request shall be forwarded by the Board of Revision of Taxes to the Department.

      (b)   A taxpayer applying outside the prescribed deadline set forth in subsection (a) above shall nonetheless be granted a real estate tax abatement according to the provisions of this Chapter, beginning in the calendar year next following the year of application, but only if one of the following conditions is met:

         (.1)   An active trade or business is being conducted on the subject real property, but only such portion of the property that is devoted to the active trade or business shall be eligible for the real estate tax abatement.

         (.2)   Substantial improvements to the subject real property are being made, or have been made since the time of the late application, but only such portion of the property upon which the improvements are being or have been erected or performed shall be eligible for the real estate tax abatement.

      (c)   The provisions of this subsection relating to application deadlines shall not apply to real property located in the Philadelphia Keystone Opportunity Expansion Zone, the Philadelphia Keystone Opportunity Improvement Zone or the Economic Development District. 666

   (4)   Interest and penalties. If the department finds that a taxpayer claimed an abatement of real property tax to which the taxpayer was not entitled under this Chapter, the taxpayer shall be liable for the abated taxes and subject to interest, additions and penalties under Section 19-1303 of this Code.

 

Notes

663	Amended, Bill No. 050504-A (approved July 8, 2005). See note 594 for effective date provisions.
664	Amended, Bill No. 071081 (approved December 21, 2007). See note 613 for effective date provisions.
665	Amended, Bill No. 071081 (approved December 21, 2007). See note 613 for effective date provisions.
666	Added, Bill No. 010092 (approved February 28, 2001); amended, Bill No. 030242 (approved May 29, 2003). See note 607 for effective date provisions.

§ 19-3206. Conditions for Use and Occupancy Tax Exemption.

   (1)   A taxpayer claiming an exemption from realty use and occupancy tax under this Chapter shall cause to be filed the required returns pursuant to Section 19-1806 and shall calculate on such return the tax liability that would be owing if the subject property were not located in the Zone.

§ 19-3207. Conditions for Business Income and Receipts Tax Credit. 667

   (1)   The Department shall establish rules and regulations and methods of apportionment and allocation so that only that part of such net income and receipts attributable to business activity conducted directly by a qualified business within the Zone shall be entitled to a credit against the business income and receipts tax.

   (2)   A qualified business, when filing its business income and receipts tax return, shall first compute its receipts and net income in conformity with Chapter 19-2600 with no adjustments or subtractions for receipts or net income attributable to business activity in the Zone, prior to calculating any credit under this Chapter.

   (3)   The credit against business income and receipts tax allowed to a taxpayer in any tax year under this Chapter shall not exceed the business income and receipts tax liability of the taxpayer for such tax year, and shall not carry forward to any other tax year.

 

Notes

667	Caption and Section amended, Bill No. 110758 (approved December 21, 2011), effective May 1, 2012.

§ 19-3208. Conditions for Net Profits Tax Exemption.

   (1)   The Department shall establish rules and regulations and methods of apportionment and allocation so that only such part of net profits attributable to business activity conducted within the Zone directly by the taxpayer shall be entitled to a credit against net profits tax.

   (2)   A taxpayer, when filing its net profits tax return, shall first compute its net profits in conformity with Chapter 19-1500 or 19-2800 with no adjustments or subtractions for net profits attributable to business activity in the Zone, prior to calculating any credit under this Chapter.

   (3)   The credit against net profits tax allowed to a taxpayer in any tax year under this Chapter shall not exceed the net profits tax liability of the taxpayer for such tax year, and shall not carry forward to any other tax year.

§ 19-3209. Conditions for Sales and Use Tax Exemption.

   (1)   Construction contracts. For any construction contract performed within the Zone, the exemption from sales and use tax under this Chapter shall only apply to the sale at retail or use of building machinery and equipment to a qualified business, or to a construction contractor pursuant to a construction contract with a qualified business, for the exclusive use, consumption and utilization by the qualified business at its facility in the Zone. For the purposes of this exemption, building machinery and equipment shall include distribution equipment purchased for the exclusive use, consumption and utilization in a facility located within the Zone. 668

   (2)   Sales at retail of tangible personal properly and services shall be defined in accordance with Article II of the Tax Reform Code of 1971, as amended.

 

Notes

668	Amended, Bill No. 010092 (approved February 28, 2001).

§ 19-3210. Conditions for Wage Tax Exemption. 669

   (1)   Residency. In order to qualify each year for an exemption from wage tax under this Chapter, a person shall be domiciled and shall reside in the Zone for a period of 184 consecutive days during each taxable year, which may begin on the date of designation of the Zone by DCED or on the date the person first resides within the Zone.

   (2)   Except as provided in subsection (3) below, and notwithstanding any exemption provided by this Chapter, the employer of any person claiming such exemption shall remain subject to Sections 19-1504 and 19-2806 relating to tax withholding. Any taxpayer claiming an exemption from wage tax pursuant to this Chapter may file a claim for refund with the Department of Revenue pursuant to Section 19-1703. 670

   (3)   Notwithstanding the provisions of subsection (2) above, an employer shall not be subject to the provisions of Sections 19-1504 and 19-2806, relating to tax withholding, with respect to any employee who is resident of the Philadelphia Strategic Development Area, so long as the employee has furnished to his or her employer information, as prescribed by the Department, necessary for the employer to withhold the correct amount of tax, including any changes to such information within 20 days after the change, unless the employer reasonably and in good faith believes such information to be inaccurate. Within 20 days after an employer receives any information from an employee requesting exemption from withholding, the employer shall forward a copy of such information to the Department. The information shall not be given retroactive effect for withholding purposes. 671

 

Notes

669	Amended, Bill No. 010092 (approved February 28, 2001).
670	Amended, Bill No. 071081 (approved December 21, 2007). See note 613 for effective date provisions.
671	Added, Bill No. 071081 (approved December 21, 2007). See note 613 for effective date provisions.

§ 19-3211. Regulations.

   (1)   The Department and, where applicable, the Board of Revision of Taxes, may promulgate regulations to implement any of the abatements, credits or exemptions provided for under this Chapter. Such regulations shall be consistent with the purposes of the Act and this Chapter and may include, but need not be limited to, provisions relating to applications, required documentation and recordkeeping, enforcement and compliance.