Pennsylvania has enacted legislation that is effective July 8, 2022 containing provisions that begin after December 31, 2022 including:
- to increase Sec. 179 expense deduction from $25,000 to conform to the deduction allowed under federal tax law at the time the property is placed in service.
- to conform to the federal IRC Sec. 1031 regarding the exchange of property held for productive use or investment which allows the gain from real property to be postponed, or deferred, if the proceeds are re-invested in similar property as part of a qualifying like-kind exchange.
- to reduce the corporate income tax incrementally over a series of years, from the current rate of 9.99% down to 4.99% in 2031.
- to require market based sourcing for the sales of intangibles for taxing purposes.
- to codify into Pennsylvania tax law that Corporations, with no physical presence, and sales of $500,000 or more per year sourced to Pennsylvania are deemed to have nexus in Pennsylvania.
Additional details to come from the Pennsylvania Department of Revenue in the coming months.
