§ 151.22. Transfer, assignment and refund of credits.
(a) Use of unsettled credits. Unsettled credits are available for transfer to corporation tax debits within the account of the taxpayer upon receipt by the Department of the Annual Report on account of which the payment is submitted. If obligations due the Commonwealth have been paid, unsettled credits may be used by the taxpayer to pay a tax or other claim due by it to the Commonwealth, may be refunded or may be assigned to another person upon receipt by the Department of the Annual Report on account of which the payment is submitted. See section 3003(f) of the TRC (72 P. S. § 10003) and section 1108(b) of the FC (72 P. S. § 1108(b)). A transfer of an unsettled credit is not prohibited by the possibility of a subsequent resettlement under section 407(b) of the TRC (72 P. S. § 7407(b)), or an account adjustment made to correct a clerical or mathematical error on the part of the taxpayer or of the Department.
(b) Use of settled credits. Settled credits shall be used in accordance with the following:
(1) Taxes to which settled credits may be transferred. Except as otherwise provided by law or by regulation, a settled Corporation Tax credits may be transferred in payment of any other tax or taxes paid or payable into the General Fund. Credits of other tax paid into the General Fund may be so transferred in payment of corporation taxes. Taxes paid or payable into the General Fund include Personal Income Taxes, Cigarette and Beverage Taxes, sales and use taxes, Inheritance Taxes and Corporation Taxes (except that portion of the Gross Receipts Tax on Motor Vehicle carriers credited to the Motor License Fund and Insurance Premiums Tax on foreign fire and foreign casualty insurance companies). Refer to section 902(b) of the TRC (72 P. S. § 7902(a)). Settled corporation tax credits may also be interchanged with tax credits from certain special funds such as the Unemployment Compensation Funds or the Motor Vehicle Fund.
(2) Availability for assignment. A settled credit may be the subject of assignment to another corporation. A settled credit is not deemed to be available for assignment, however, unless outstanding tax debits reflected in the account of the assignor are offset by sufficient credits to satisfy the debits, and unless other obligations due the Commonwealth by the taxpayer have been fully paid.
(3) Availability for refund. A settled credit may be refunded if outstanding tax debits reflected in the account are offset by sufficient credits to satisfy the debits and if other obligations due the Commonwealth by the taxpayer have been paid.
(4) Petition for cash refund. A settled credit which is the subject of a Petition for Cash Refund may not be transferred to taxes other than corporation taxes and may not be assigned to another corporation during the pendency of the proceedings.
(c) Procedures for transfer, assignment and refund. Procedures for transfer, assignment and refund shall conform with the following:
(1) Transfer by corporation. A corporation may direct the Department to transfer unsettled or settled credits of the corporation to present or anticipated tax debits of the corporation by submitting a letter, signed by an authorized representative of the corporation, setting forth the type, year and amount of the credit to be so transferred and the tax debit or debits to which it is to be applied.
(2) Transfer by Department. The Department may transfer unsettled or settled credits of the taxpayer within the account of the taxpayer. The Department may first make the transfer, and will send the taxpayer a statement of the specific manner in which the credits have been applied. The taxpayer may object to the proposed transfer within 30 days of receipt of the statement, and, if the Department determines that the objection is proper, the transfer will be reversed.
(3) Assignment. To assign an unsettled or settled tax credit to another taxpayer, whether or not a subsidiary corporation, the assignor shall complete and submit to the Department an Assignment of Tax Credit form signed by an authorized representative of the assignor corporation. The application will be deemed to authorize the Department to review the assignor’s account, transfer credits that may be necessary to offset or pay outstanding tax debits, and make other determinations that may be necessary to compute the assignor’s current available unsettled or settled credit balance. The Department will then apply the unsettled or settled credit assigned (not exceeding the current available balance) in accordance with the assignee’s instructions or, in the absence of instructions, in the manner provided by § 151.24 (relating to order of application of tax credits). The Department will then confirm the assignment in writing to both parties.
(4) Refund. To obtain a refund of an unsettled or settled tax credit, the taxpayer shall submit to the Department a letter signed by an authorized representative of the taxpayer. The letter shall specify which credits the taxpayer is requesting be refunded, shall include a statement that the taxpayer has no obligations due the Commonwealth and shall be deemed to authorize the Department to review the taxpayer’s account, transfer credits that may be necessary to offset or pay outstanding tax debits and make other determinations that may be necessary to compute the taxpayer’s current available unsettled and settled credit balance. The Department will then refund the unsettled or settled credit in accordance with the taxpayer’s instructions.
Source The provisions of this § 151.22 adopted March 23, 1979, effective March 24, 1979, 9 Pa.B. 1071; amended January 16, 1987, effective January 17, 1987, 17 Pa.B. 273. Immediately preceding text appears at serial pages (40493) to (40494) and (94409).
Cross References This section cited in 61 Pa. Code § 151.21 (relating to definitions).
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