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§ 7403.2. Additional withholding requirements

Purdon's Pennsylvania Statutes and Consolidated StatutesTitle 72 P.S. Taxation and Fiscal AffairsEffective: December 23, 2003

Purdon's Pennsylvania Statutes and Consolidated Statutes
Title 72 P.S. Taxation and Fiscal Affairs
Chapter 5. Tax Reform Code of 1971 (Refs & Annos)
Article IV. Corporate Net Income Tax (Refs & Annos)
Part III. Reports and Payment of Tax
Effective: December 23, 2003
72 P.S. § 7403.2
§ 7403.2. Additional withholding requirements
Currentness
(a) Every partnership exercising, whether in its own name or through any person, association, business trust, corporation, joint venture, limited liability company, limited partnership, partnership or other entity, any of the privileges specified in section 402(a)(1) through (4)1 shall make a return for the taxable year of its net nonfiling corporate partners' shares of income and deductions.
(b) A partnership required to file a report under subsection (a) shall withhold and pay to the department a tax on behalf of its nonfiling corporate partners in an amount equal to its net nonfiling corporate partners' shares of income and deductions as reported to the Federal Government multiplied by the tax rate applicable to the taxable year being reported. Any amount withheld and paid to the department on behalf of a nonfiling corporate partner shall be considered a tax payment by that partner and credited to its account as if it was directly paid by the partner.
(c) If an amount of tax required to be withheld and paid under this section is not paid on or before the date prescribed, a penalty of five per cent of the underpayment for each month or fraction of a month from the due date to the date paid shall be added to the tax and paid to the department. The underpayment shall, for purposes of computing the addition for any month, be reduced by the amount of the part of the tax which is paid by the beginning of that month. The total of the additions shall not exceed fifty per cent of the amount of the tax.
(d) The report required by subsection (a) shall be filed with the department in a form prescribed by the department, and the payment required by subsection (b) shall be paid to the department on or before the fifteenth day of the fourth month following the end of the taxable year.
(e) The following words, terms and phrases when used in this section shall have the meaning ascribed to them in this section, except where the context clearly indicates a different meaning:
“Net nonfiling corporate partners' shares of income and deductions as reported to the Federal Government.” That portion of the income, less the deductions:
(1) reported on Schedule K of the Federal Form 1065, Return of Partnership Income, filed with the Federal Government for the taxable year; and
(2) allocated on Federal Schedule K-1 to nonfiling corporate partners.
If the entire business of the partnership is not transacted in this Commonwealth, the amount computed under this definition shall be apportioned to this Commonwealth as provided in section 401(3)22 as if the partnership were a corporation subject to tax under this article.
“Nonfiling corporate partner.” A partner which:
(1) is a corporation as defined in section 401; and
(2) has not filed a tax report and paid the tax required by sections 402 and 4033 for the previous taxable year.
“Partner.” An owner of an interest in the partnership, in whatever manner that owner and ownership interest are designated.
“Partnership.” An entity classified as a partnership for Federal income tax purposes.
(1) The term includes:
(i) a partnership, limited partnership, limited liability partnership or limited liability company; and
(ii) any syndicate, group, pool, joint venture, business trust, association or other unincorporated organization through or by which a business, financial operation or venture is carried on.
(2) The term does not include an entity that is:
(i) listed on a United States national stock exchange; or
(ii) described in section 401(1)1 or 2.

Credits

1971, March 4, P.L. 6, No. 2, art. IV, § 403.2, added 2003, Dec. 23, P.L. 250, No. 46, § 12.1, imd. effective.

Footnotes

1
72 P.S. § 7402.
2
72 P.S. § 7401.
3
72 P.S. §§ 7402, 7403.
72 P.S. § 7403.2, PA ST 72 P.S. § 7403.2
Current through Act 10 of the 2024 Regular Session. Some statute sections may be more current, see credits for details.
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