PICPA, Department of Revenue Team Up on Taxpayer Guidance
With about a month remaining before the April 15 deadline to file state and federal tax returns, the PICPA and Department of Revenue, along with the IRS, teamed up to offer useful filing tips and guidance to help Pennsylvanians avoid falling victim to common tax scams.
“Last year we saw approximately 2.7 million taxpayers file their Pennsylvania tax returns in the final month before the filing deadline,” said Revenue Secretary Dan Hassell, whose department annually processes more than 6 million personal income tax returns. “This is a good time for us to remind the public that filing now through our free online system can help prevent cybercriminals from stealing your personal information and filing a fraudulent tax return in your name.”
Jason Skrinak, CPA, state and local tax practice leader with RKL LLP and a member of the PICPA Committee on State Taxation, encouraged taxpayers to set aside plenty of time to file state and federal returns. This allows taxpayers to verify their returns are correct before they are submitted. He also encouraged Pennsylvanians to use tax season as an opportunity to take a closer look at the security safeguards they have in place to protect their data and sensitive personal information.
“This is a great time to change your passwords and take a closer look at the security precautions you’re using to protect yourself online,” Skrinak said. “If you’re working with a tax preparer, you should also make sure the preparer has the right securities in place to protect your personal information.”
IRS Senior Stakeholder Liaison Richard Furlong Jr. discussed the IRS’s “Dirty Dozen” tax scams, an annual list of common scams that peak during the filing season as people prepare their tax returns. These involve phishing schemes, phone scams, identity theft ploys, and refund fraud committed by dishonest tax preparers.
For more information on ways to protect yourself, visit the Department of Revenue's Identity Theft Victim Assistance webpage.
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House Finance Committee Report
Rep. Mike Peifer, CPA (Inactive) (R-Pike), chair of the House Finance Committee, reported that his committee approved several legislative measures.
- House Bill 262, sponsored by Rep. Carl Metzgar (R-Somerset/Bedford), would eliminate the inheritance tax rate for transfers of property to or for the use of a child aged 21 years or younger from a natural parent, adoptive parent, or step-parent.
- House Bill 296, sponsored by Rep. Tarah Toohil (R-Luzerne), would provide a tax credit for families who provide permanency to children in the care of Pennsylvania’s Department of Human Services.
- House Bill 330, sponsored by Rep. Joe Emrick (R-Northampton), makes technical corrections to the Property Tax Relief Act.
- House Bill 538, sponsored by Rep. Marty Flynn (D-Lackawanna), would establish a state income tax exemption for Olympic prize winnings and medals received from the United States Olympic Committee on account of competition in the Olympic Games or Paralympic Games.
- House Bill 628, sponsored by Rep. Aaron Kaufer (R-Luzerne), would extend the authority of the state treasurer to invest monies in the state treasury according to the prudent investor standard through 2021.
The committee also approved a measure sponsored by Rep. Kate Klunk (R-York). House Resolution 110 urges Congress to pass legislation that would allow students in apprenticeship programs to use 529 accounts to purchase program-related tools and equipment.
All the measures are now before the full House for a final vote.
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Continuing Education Carryover Bill Gains Committee Approval
State Rep. Harry Readshaw’s (D-Allegheny) legislation that would allow professionals to carry over accrued continuing education (CE) credits for biennial terms cleared the House Professional Licensure Committee.
House Bill 64 amends Act 48 of 1993. It would add a provision allowing professionals who are required to maintain CE to accrue credits in excess of what is required for biennial renewal (CE carryover). Any carryover shall be valid for one biennial renewal term only.
The bill now goes to the full House for consideration. A similar bill nearly made it to the governor’s desk last session, but the legislative clock had run out.
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House Committee Approves Statewide Commerce Court
To ensure that Pennsylvania businesses are dealt with in an effective and efficient manner during the legal process, the Pennsylvania House Judiciary Committee approved legislation to allow for statewide Commerce Courts.
House Bill 332, sponsored by Seth Grove (R-York), would allow the state Supreme Court to create Commerce Courts in counties across the state to provide uniformity in business legal matters brought before the courts. The specialized courts would handle complex business cases, including acquisitions, mergers, dissolutions and liquidations, among other areas.
The legislation will now be considered by the full House.
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IFO Updates on Homestead Exemption and Special Funds Reports
The Independent Fiscal Office (IFO) provided state lawmakers with updates on funding the homestead exemption and special funds.
IFO notes in a March 8 letter that a 62 percent increase in the state’s personal income tax would be needed to fully fund the school property tax homestead exclusion. The state’s PIT rate, currently 3.07 percent, would need to increase 1.90 percentage points to generate the $8.5 billion needed to fully fund a 100 percent homestead exclusion for school district property taxes. Each 0.1 percentage point in the PIT rate generates $446 million in net revenue, according to IFO.
In a second letter, also dated March 8, to Sen. Pat Browne, chair of the Senate Appropriations Committee, IFO provided senators with an update to its Feb. 12, 2018, report on the receipts and disbursements of certain special funds and information on how Pennsylvania compares with other states with regard to the use of special funds.
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Career and Technical Education Package Clears Committee
This week, the state House Education Committee, led by Chair Curt Sonney (R-Erie), approved a bipartisan package of bills aimed at improving career and technical education (CTE) in Pennsylvania.
Bills in the package include:
- House Bill 265, sponsored by Rep. Craig Staats (R-Bucks), would expand the online database that allows students and potential students to check where courses, programs, certificates, and diplomas are able to be transferred among public schools and institutions of higher education.
- House Bill 297, sponsored by Rep. Zach Mako (R-Lehigh/Northampton), would help improve career information and recruitment.
- House Bill 334, sponsored by Rep. Seth Grove (R-York), would deal with the Commission for Agriculture Education Excellence, the use of course credits, and the classification of program codes.
- House Bill 393, sponsored by Rep. Patrick Harkins (D-Erie), would create an online career resource center.
- House Bill 394, sponsored by Rep. Gerald Mullery (D-Luzerne), would require the Pennsylvania Department of Education to create an inventory of workforce development programs offered at secondary and post-secondary institutions.
- House Bill 395, sponsored by Rep. James Roebuck (D-Philadelphia), would require CTE programs to establish occupational advisory committees.
- House Bill 396, also sponsored by Roebuck, would add at least one administrator from a career and technical center to each Workforce Development Board.
- House Bill 522, sponsored by Rep. Mike Tobash (R-Schuylkill/Dauphin), would create a CTE investment incentive program, including tax credits for businesses that contribute to CTE programs and enrollment expansion programs.
The bills move to the full House for consideration.
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Bill Introduced Recognizing Carbon-Free Value Nuclear Energy
In an effort to prevent the premature and permanent closure of Pennsylvania’s nuclear power plants, Rep. Tom Mehaffie (R-Dauphin) introduced legislation to update the Pennsylvania Alternative Energy Portfolio Standards (AEPS) Act to recognize nuclear energy for its significant contribution to the state’s zero-carbon energy production.
Known as the Keep Powering Pennsylvania Act, House Bill 11 would amend the AEPS Act to include nuclear energy as a qualifying energy resource under a new Tier III.
The third tier would recognize the value that all zero-emission electric generation resources provide, including carbon-free nuclear energy. As is the case with the existing AEPS law, Tier III will include a structure that requires the purchasing of credits.
Exelon Corp. announced plans to shut down the Three Mile Island nuclear power plant by September 2019, and FirstEnergy Corp. said it plans to shut down the Beaver Valley Power Station in western Pennsylvania in 2021 if current market flaws are not addressed.
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Democrats Retain Two Seats in Special House Elections
Democrats Bridget Malloy Kosierowski and Movita Johnson-Harrell both claimed easy victories in special elections for the state House 114th and 190th Legislative Districts, respectively.
Kosierowski claimed victory in the Scranton-area district vacated by Rep. Sid Michaels Kavulich. Kavulich died in office in October, but his name appeared unopposed on the ballot in November and was easily reelected.
Johnson-Harrell won the West Philadelphia seat vacated by Rep. Vanessa Lowery Brown in January. Lowery Brown resigned after being sentenced to probation in November for a bribery conviction.
Republicans hold a 110 to 93 majority.
In related news, Lt. Gov. John Fetterman announced a May 21 special election to fill two state Senate seats vacated by the early retirements of Sen. Richard Alloway (R-Franklin) and Sen. Don While (R-Indiana). The nominees for both elections will be selected by the parties.
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