In corporate net income tax, further providing for imposition of tax; and abrogating a regulation.
Summary
SB1153 amends Pennsylvania’s Corporate Net Income Tax provisions to exclude certain remote work performed by Pennsylvania resident employees from the activities that are treated as taxable privileges of a corporation. Under the bill, the exclusion applies when the employee is a Pennsylvania resident, the employee’s primary work location for corporate tax purposes is in another state or the District of Columbia, and the employee works remotely in Pennsylvania less than 50% of normal working hours on an annual basis. The bill also states that it does not alter a taxpayer’s existing right to apportion income under the Tax Reform Code.
The measure further abrogates a specific Department of Revenue regulation, 61 Pa. Code § 153.23(b), to the extent it conflicts with the new statutory language. It applies retroactively to tax years beginning after December 31, 2023, and takes effect immediately. In practical terms, the bill would narrow the circumstances under which Pennsylvania can treat certain remote work by resident employees as part of a corporation’s taxable presence or activity for corporate net income tax purposes.
Impact
SB1153 would change the Tax Reform Code of 1971 by adding a new subsection to Section 402 governing corporate net income tax imposition. It would limit the tax treatment of remote work by Pennsylvania residents whose primary work location is outside the Commonwealth, and it would override inconsistent administrative regulation. The bill could affect corporations with multistate workforces, remote employees, and tax apportionment and compliance practices, especially for employers with Pennsylvania residents working primarily for out-of-state offices.
Sentiment
No committee transcripts or recorded votes were provided, so there is no direct evidence of debate or formal support/opposition in the available record. Based on the bill text alone, the measure appears to be a targeted tax clarification aimed at remote-work and corporate tax administration issues rather than a broad policy change. Its retroactive application suggests the sponsors intended to address an existing interpretation or enforcement issue.
Contention
The likely point of contention is whether Pennsylvania should exclude certain remote work from corporate net income tax calculations when the employee is a Pennsylvania resident but primarily assigned to another state. Supporters would likely view the bill as a clarification that prevents overreach and aligns tax treatment with modern remote-work arrangements, while opponents may argue it reduces tax revenue, creates retroactive tax changes, or complicates apportionment and enforcement. The abrogation of an existing regulation also indicates a possible dispute with current Department of Revenue interpretation.
In personal income tax, further providing for imposition of tax, for when withholding not required, for returns and liability and for return of Pennsylvania S corporation.
In personal income tax, further providing for imposition of tax, for when withholding not required, for returns and liability and for return of Pennsylvania S corporation.
In corporate net income tax, further providing for definitions, for imposition of tax, for reports and payment of tax and for consolidated reports; and, in general provisions, further providing for underpayment of estimated tax.
In personal income tax, further providing for classes of income; in corporate net income tax, further providing for definitions; and providing for personal health investment tax credit.