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Tax Credits and Programs

Community-Based Service Credit

This program will provide tax credits for contributions made by business firms to non-profit providers of community-based services to individuals with intellectual disabilities or mental illness.

For more information, review the Program Guidelines or call the Department of Community and Economic Development’s Customer Service Center at 1-800-379-7448. Tax questions may be directed to the Department of Revenue at 717-772-3896 or ra-btftrevkoz@pa.gov.

Educational Tax Credits

The Educational Tax Credits program contains two sections of which credits may be awarded for applicants within the program.

The Educational Improvement Tax Credit (EITC) is available to eligible businesses that contribute to scholarship organizations (including pre-kindergarten) and educational improvement organizations, in order to promote expanded educational opportunities for students in Pennsylvania. The Program Guidelines provide more information.

The Opportunity Scholarship Tax Credit (OSTC) is available to eligible businesses that contribute to IRC 501C opportunity scholarship organizations approved by the Department of Community and Economic Development. Opportunity Scholarship Organizations can provide scholarships to eligible students living within the boundary of the lowest-achieving 15 percent of elementary and lowest-achieving 15 percent of secondary schools as published by the Department of Education. For more information on OSTC review the Program Guidelines.

To speak with a representative of the program, please contact the Department of Community and Economic Development at 1-800-379-7448. Tax questions may be directed to the Department of Revenue at 717-772-3896 or ra-btftrevkoz@pa.gov.

To make an irrevocable election to pass-through an EITC to partners, members or shareholders, a business must complete form: REV-1123. A separate election must be completed for each year the credit is awarded and not used in whole or in part.

Informational Notice - Miscellaneous Tax 2015-01 -- Education Tax Credits

Keystone Innovation Zone (KIZ) Tax Credit

The KIZ Program creates geographic zones to foster innovation and entrepreneurial opportunities by aligning the combined resources of educational institutions and the private sector.

For more information, review  the Program Guidelines or call the Department of Community and Economic Development’s Customer Service Center at 1-800-379-7448. Tax questions may be directed to the Department of Revenue at 717-772-3896 or ra-btftrevkoz@pa.gov.

Keystone Special Development Zone (KSDZ)

The Keystone Special Development Zone (KSDZ) is an incentive-based tax credit program to foster the redevelopment of abandoned, deteriorated commercial and industrial sites. Eligible businesses that are established within and/or relocate to a KSDZ have the opportunity to earn restricted tax credits in exchange for job creation within the zone.

For more information, review the Program Guidelines, or call the Department of Community and Economic Development’s Customer Service Center at 1-800-379-7448. Tax questions may be directed to the Department of Revenue at 717-772-3896 or ra-btftrevkoz@pa.gov.

Historic Preservation Tax Credit

This program will provide tax credits for qualified taxpayers to rehabilitate a qualified historic structure that is approved by the PA Historical & Museum Commission.

For more information, review the Program Guidelines, or call the Department of Community and Economic Development’s Customer Service Center at 1-800-379-7448. Tax questions may be directed to the Department of Revenue at 717-772-3896 or ra-btftrevkoz@pa.gov.

Tax Credit for New Jobs

Formerly referred to as the Job Creation Tax Credit program, this tax credit is available to businesses approved within the program that agree to create new jobs within Pennsylvania. Job credits may be awarded from $1,000 to $2,500 per job.

For more information, review the Program Guidelines, or call the Department of Community and Economic Development’s Customer Service Center at 1-800-379-7448. Tax questions may be directed to the Department of Revenue at 717-772-3896 or ra-btftrevkoz@pa.gov.

Mobile Telecommunications Broadband Investment Tax Credit

For tax years beginning after December 31, 2013, and ending before January 1, 2024, a taxpayer that is a provider of mobile telecommunication services shall be allowed a tax credit against the corporate net income tax imposed under Article IV of the Tax Reform Code for investment in certain qualified broadband equipment placed into service in this Commonwealth.

To apply for a Mobile Telecommunications Broadband Investment Tax Credit, complete  Mobile Telecommunications Broadband Investment Tax Credit Application. Tax questions may be directed to the Department of Revenue at 717-772-3896 or ra-btftrevkoz@pa.gov.

Neighborhood Assistance Program

This program encourages taxpayers to contribute to neighborhood organizations and charitable food programs and engage in activities that promote community economic development in impoverished areas.

For more information, review the Program Guidelines, or call the Department of Community and Economic Development’s Customer Service Center at 1-800-379-7448. Tax questions may be directed to the Department of Revenue at 717-772-3896 or ra-btftrevkoz@pa.gov.

Research & Development (R&D) Tax Credit

This tax credit is available to businesses and individuals performing qualified research in Pennsylvania, to encourage businesses in the commonwealth to conduct research.

For more information, please review the REV-545 application for credit. Tax questions may be directed to the Department of Revenue at 717-772-3896 or ra-btftrevkoz@pa.gov.

Resource Enhancement and Protection (REAP) Tax Credit

This program provides a tax credit to farmers and businesses that invest in the implementation of best management practices in agricultural operations to enhance farm production and protect natural resources.

For more information or to apply for a Resource Enhancement and Protection Tax Credit, visit the Department of Agriculture’s Program Guidelines webpage or call 717-787-8821. Tax questions may be directed to the Department of Revenue at 717-772-3896 or ra-btftrevkoz@pa.gov.

Enterprise Zone (EZ) Program

This program broadened the scope of the Neighborhood Assistance Program, promoting job growth and helping municipalities take advantage of business expansion opportunities.

For more information, review the Program Guidelines, or call the Department of Community and Economic Development’s Customer Service Center at 1-800-379-7448. Tax questions may be directed to the Department of Revenue at 717-772-3896 or ra-btftrevkoz@pa.gov.

Entertainment Production Tax Credit

The Entertainment Production Tax Credit program contains three areas of which credits may be awarded for applicants within the program: Film Production Tax Credit, Concert Rehearsal and Tour Tax Credit and the Video Game Production Tax Credit.

The Film Production tax credit was established to create a film industry within the Commonwealth to attract the production of films, television commercials or television shows for a national audience.

The Concert Rehearsal and Tour tax credit was established to attract investment in the commonwealth by awarding tax credits to tour operators representing musicians for rehearsals and live musical performances within the state.

The video game production tax credit program is designed to attract investment in the commonwealth by awarding tax credits for production expenses incurred by video game production companies.

Film Tax Credit Employer Withholding Requirements

The Department of Community and Economic Development has more information online or call the DCED Customer Service Center at 1-800-379-7448. Tax questions may be directed to the Department of Revenue at 717-772-3896 or ra-btftrevkoz@pa.gov.

Mixed-Use Development Tax Credit Program

The Mixed-Use Development Tax Credit program, administered by the Pennsylvania Housing Finance Agency authorizes the Agency to sell $2 million of state tax credits to qualified taxpayers for the purpose of establishing a Mixed-Use Development Fund. Distributions from the fund will be awarded to eligible construction or rehabilitation projects in the Commonwealth.

For more information, visit the Pennsylvania Housing Finance Agency Program Guidelines or call the PHFA at 717-780-1867. Tax questions may be directed to the Department of Revenue at 717-772-3896 or ra-btftrevkoz@pa.gov.

Pennsylvania Resource Manufacturing Tax Credit (PRM)

Beginning in 2017, any manufacturer purchasing natural gas containing ethane as a petrochemical feedstock at a facility within the Commonwealth could be eligible for a PRM Tax Credit equal to five cents per gallon ($2.10 per barrel) of ethane purchased and used in manufacturing ethylene, so long as the company makes a capital investment of at least $1 billion and creates the equivalent of at least 2,500 full-time jobs while constructing the manufacturing facility. Effective for ethane purchased between Jan. 1, 2017 and Dec. 31, 2042.

This program provides a powerful incentive that will revitalize Pennsylvania’s manufacturing industry, create thousands of good-paying Pennsylvania jobs and secure long-term economic benefits for Pennsylvania residents and communities.

For more information and to apply for the Pennsylvania Resource Manufacturing Tax Credit, contact the Department of Revenue’s Economic Development Coordinator at 717-772-3896 or ra-btftrevkoz@pa.gov.

Sale and Assignment for Restricted Tax Credits

Special rules apply for taxpayer’s that sell/assign restricted credits. For specific information regarding these rules, review Tax Bulletin 2014-04.

Effective immediately, entities that are no longer subject to filing the RCT-101 Corporate Tax Report as per the phase out of the Capital Stock & Foreign Franchise Tax are required to file the PA- 20S/PA-65, S Corporation/Partnership Information return prior to selling a restricted credit. Every domestic or foreign PA S corporation (72 P.S. § 7330.1), partnership (72 P.S § 7335(c)), or entity formed as a limited liability company that is classified as a partnership or S corporation for federal income tax purposes, must file the PA- 20S/PA-65 Information Return.

Statement of Account for Restricted Tax Credits

Business taxpayers and tax practitioners now have the ability to electronically request and receive a more detailed version of the Statement of Account (e-SOA) in PDF format through the new Document Center section in e-TIDES. The e-SOA can be requested at any time and is made available in PDF format in the Document Center to print or download on the next business day.

Logon to e-TIDES and request an e-SOA through the e-TIDES Document Center.