An Act amending the act of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of 1971, in personal income tax, further providing for special tax provisions for poverty.

PRINTER'S NO. 1463
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No. 1287
Session of
2025
INTRODUCED BY CEPEDA-FREYTIZ, D. MILLER, VENKAT, GIRAL,
SCHLOSSBERG, SANCHEZ, KHAN, HILL-EVANS, MERSKI, CIRESI,
FREEMAN, OTTEN, HOHENSTEIN, STEELE, CERRATO, WAXMAN,
KENYATTA, FIEDLER, PROBST, PARKER AND GREEN, APRIL 22, 2025
REFERRED TO COMMITTEE ON FINANCE, APRIL 22, 2025
AN ACT
Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An
act relating to tax reform and State taxation by codifying
and enumerating certain subjects of taxation and imposing
taxes thereon; providing procedures for the payment,
collection, administration and enforcement thereof; providing
for tax credits in certain cases; conferring powers and
imposing duties upon the Department of Revenue, certain
employers, fiduciaries, individuals, persons, corporations
and other entities; prescribing crimes, offenses and
penalties," in personal income tax, further providing for
special tax provisions for poverty.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Section 304(d)(1) of the act of March 4, 1971
(P.L.6, No.2), known as the Tax Reform Code of 1971, is amended
and the subsection is amended by adding a clause to read:
Section 304. Special Tax Provisions for Poverty.--* * *
(d) Any claim for special tax provisions hereunder shall be
determined in accordance with the following:
(1) If the poverty income of the claimant during an entire
taxable year is [six thousand five hundred dollars ($6,500)] ten
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thousand dollars ($10,000) or less, or, in the case of a married
claimant, if the joint poverty income of the claimant and the
claimant's spouse during an entire taxable year is [thirteen
thousand dollars ($13,000)] twenty thousand dollars ($20,000) or
less, the claimant shall be entitled to a refund or forgiveness
of any moneys which have been paid over to (or would except for
the provisions of this act be payable to) the Commonwealth under
the provisions of this article, with an additional income
allowance of nine thousand five hundred dollars ($9,500) for
each dependent of the claimant. For purposes of this subsection,
a claimant shall not be considered to be married if:
(i) The claimant and the claimant's spouse file separate
returns; and
(ii) The claimant and the claimant's spouse live apart at
all times during the last six months of the taxable year or are
separated pursuant to a written separation agreement.
* * *
(4) For the tax year immediately following the effective
date of this clause and for every tax year thereafter, the
poverty income amounts under clause (1) for a claimant and for a
claimant and the claimant's spouse shall be increased by an
annual cost-of-living adjustment calculated by applying the
percentage change in the Consumer Price Index for All Urban
Consumers (CPI-U) for the Pennsylvania, New Jersey, Delaware and
Maryland area, for the most recent twelve-month period for which
figures have been officially reported by the United States
Department of Labor, Bureau of Labor Statistics immediately
prior to the date the adjustment is due to take effect, to the
then current poverty income amounts for a claimant and for a
claimant and the claimant's spouse . The department shall
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determine the percentage increase and the new poverty income
amounts for a claimant and for a claimant and the claimant's
spouse prior to the annual effective date of the adjustment and
shall transmit notice to the Legislative Reference Bureau for
publication in the next available issue of the Pennsylvania
Bulletin within ten days of the date the determination is made.
The poverty income amounts for a claimant and for a claimant and
the claimant's spouse may not be decreased as a result of a
negative percentage change in the CPI-U for the Pennsylvania,
New Jersey, Delaware and Maryland area.
Section 2. This act shall take effect in 60 days.
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