Instructions For Form Pa-20s/pa-65 - Schedule Oc - Other Credits

● Capital stock/foreign franchise tax

or 100 percent of the entity own-

apply the tax credit against the follow-

ers’ liabilities.

ing Pennsylvania state taxes:

● Corporate net income tax

● Pennsylvania does not allow the de-

● Capital stock/foreign franchise tax

● Bank shares tax

duction of certain expenses used to

● Corporate net income tax

qualify for the Educational Improve-

● Mutual thrift institutions tax

ment Tax Credit. If the expenses

● Bank shares tax

● Title insurance and trust company

were deducted in calculating fed-

shares tax

● Mutual thrift institutions tax

eral-taxable income, the amount

should be reported as a reduction in

● Insurance gross premiums tax

● Title insurance and trust company

expenses on PA-20S/PA-65 Sched-

unauthorized, domestic/foreign

shares tax

ule M, Part B, Section E, Line f. Do

marine)

● Personal income tax

not reduce Pennsylvania-taxable in-

● Surplus lines tax

come by amounts paid to qualify for

Guidelines for the Keystone Special

the tax credit.

● Personal income tax

Development Zone Tax Credit

● The tax credit cannot be applied

● The tax credit can be earned for

Guidelines for the Educational

against any tax withheld by an em-

ten years of a 15-year period be-

Improvement Tax Credit

ployer from an employee under Ar-

ginning July 1, 2012 through June

● The entity decides if the tax credit

ticle III of the Tax Reform Code.

30, 2026.

will be applied towards corporation

tax and/or passed through to its

● There is no expiration date for the

● The entity decides if the tax credit

partners, shareholders or members.

awarding of the Educational Im-

will be applied towards corporation

provement tax credit.

tax and/or passed through to its

● The tax credit cannot be sold or

partners, members or shareholders

assigned.

For more information and to apply for

(owners).

an Educational Improvement tax credit,

● Although any unused tax credits

visit the Department of Community and

● The tax credit may be carried

may not be carried forward, the

Economic Development’s website at

forward, sold, assigned and is not

entity may elect in writing prior to

or call the DCED

refundable.

the due date of the entity’s tax re-

Customer

Service

Center

turn to pass through all or a portion

● Purchased or assigned tax credits

1-800-379-7448.

of the tax credit to its owners in the

may be applied to no more than 75

taxable year of the contribution or

KEYSTONE SPECIAL

percent of the tax liability of the

the taxable year immediately fol-

DEVELOPMENT ZONE TAX CREDIT

purchaser or assignee.

lowing the year of contributions.

The Pennsylvania Department of Com-

● The purchaser or assignee shall

munity and Economic Development

● To make an irrevocable election to

claim the tax credit in the year in

(DCED) administers the award of this

pass through an Educational Im-

which the purchase or assignment

tax credit. Applications must be submit-

provement tax credit to partners,

is made.

ted to the DCED by Feb.1 of the year

shareholders or members, a busi-

for the previous calendar year. Eligibil-

● The entity can pass through in

ness should visit the Department

ity is based on businesses that build

whole or part unused tax credits to

Revenue’s

website

structures on and then employ addi-

its owners. The amount of the tax

and

tional workers in/on land designated as

credit passed through to owners is

complete REV-1123, Educational

a special industrial area in the Land Re-

based on the percentage of income

Improvement Tax Credit Election

cycling and Environment Remediation

distribution from the entity receiv-

Form. The entity must complete a

Standards Act of 1995. Land must have

ing the tax credit. The owner must

separate REV-1123 each year the

no permanent vertical structures at-

use the tax credit in the year it is

tax credit is awarded and not used

tached prior to July 1, 2011. Credit is

passed through.

in whole or in part.

$2,100 for each full-time or full-time

● The applicant/awardee cannot be

● REV-1123 must be sent to the

equivalent (35 hours or more) new em-

an employer constructing the im-

Revenue’s Bureau of Corporation

ployee working 90 percent within a

provements in the Keystone Spe-

Taxes by the tax return filing due

keystone special development zone

cial Development Zone.

date (including extensions) of the

over and above each full-time or full-

entity. However, REV-1123 must

time equivalent employee working prior

● An employer may not claim both

be sent separately from the en-

to Jan. 1, 2012.

Keystone Opportunity Zone and

tity’s tax return.

Keystone Special Development

For more information, to apply for a

Zone tax credit.

● The amount of the tax credit

Keystone Special Development Zone

passed through to partners, share-

Tax Credit, visit the Department of

● If the company fails to maintain

holders or members is based on

Community and Economic Develop-

operations for five years from sub-

the percentage of income distribu-

ment’s website at

mission of certificate to the De-

tion from the entity receiving the

call the DCED Customer Service Center

partment

Revenue,

the

tax credit.

at 1-800-379-7448.

company shall be required to re-

● The tax credit may be applied to

Qualified businesses, including pass

fund the total amount of tax cred-

100 percent of the entity’s liability

through entities and individuals, can

its granted, with interest and a

Instructions For Form Pa-20s/pa-65 - Schedule Oc - Other Credits - 2013 Page 7

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