Q&A with the Pennsylvania Department of Revenue

Would the capital value of ABC Corp. be included for the period in which the entity was a savings bank?

Sep 04, 2015
Scenario:

ABC Corp. is a savings bank that began doing business in PA approximately 2005. The entity has been filing MTIT reports. DEF Corp. is a national bank that has been doing business in PA since 2000. The entity has been filing Shares Tax reports. During the second quarter of 2010, ABC Corp. converted to a national bank and DEF Corp. merged into ABC Corp after the conversion. In computing ABC Corp.’s Shares Tax report on January 1, 2011, please explain whether the capital value of ABC Corp. would be included for the period in which the entity was a savings bank, i.e, prior to its conversion to a bank. (The issue is whether ABC Corp. would be viewed as a “new institution” upon the conversion to a national bank.)

A.

The calculation of the shares value of ABC Corp includes the capital value of both ABC Corporation and DEF Corporation for 2005 to 2010. ABC Corporation is not considered a new entity at the time of the conversion to a national bank.

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These documents provide a summary of the answers provided by the Department of Revenue to the PICPA Committee on State Taxation at its annual question and answer session. These documents are classified as revenue information issued for informational purposes only for the convenience of PICPA members. Pursuant to 61 Pa. Code Section 3.4, these documents should not be relied upon for any purpose or used in tax appeals. Taxpayers requiring a binding opinion on their specific fact situation may request a written letter ruling under 61 Pa. Code Section 3.3.