Unless otherwise expressly stated, the following terms shall have,
for the purposes of this Part, the meanings herein indicated, except
where the context indicates or requires a different meaning:
ASSOCIATION
A partnership, limited partnership or any other form of unincorporated
group owned by two or more persons.
BUSINESS
Any enterprise, activity, profession, trust or unincorporated
undertaking of any nature conducted for profit, whether by an individual,
agent, broker, copartnership, association or other entity.
COLLECTOR OF TAXES
The elected Tax Collector of Jefferson Township or a person
or entity of any kind duly appointed to collect taxes by the Board
of Supervisors of Jefferson Township pursuant to and under the authority
of the Local Tax Enabling Act (Act 511), 53 P.S. § 6901
et seq., as amended.
CORPORATION
A corporation or joint-stock association organized under
the laws of the United States, the Commonwealth of Pennsylvania or
any other state, territory or foreign country or dependency.
DOMICILE
The place where one lives and has his permanent home and
to which he has the intention of returning whenever he is absent.
Actual residence is not necessarily domicile, for domicile is the
fixed place of abode which, in the intention of the taxpayer, is permanent
rather than transitory. Domicile is the voluntary fixed place of habitation
of a person, not for a mere special or limited purpose, but with the
present intention of making a permanent home, until some event occurs
to induce him to adopt some other permanent home.
EARNED INCOME
All compensation as determined and defined under Sections
301 and 303 of the Act of March 4, 1971 (P.L. 6, No. 2), known as
the "Tax Reform Code of 1971," as amended, currently codified at 72
P.S. §§ 7301 and 7303, and regulations in 61 Pa. Code,
Part I, Subpart B, Article V (relating to personal income tax). Employee
business expenses are allowable deductions as determined under Article
III of the Tax Reform Code of 1971. The amount of any housing allowance
provided to a member of the clergy shall not be taxable as earned
income.
A.
Examples of earned income, without intending to alter or change
the aforesaid definition or to limit such definition to these examples,
are:
(5)
Drawing accounts. (If amounts received as a drawing account
exceed the salary or commissions earned, the tax is payable on the
amounts received. If the employee subsequently repays to the employer
any amounts not in fact earned, the tax shall be adjusted accordingly.)
(9)
Benefits accruing from employment, including but not limited
to annual leave, vacation, holiday, sickness and separation benefits,
but excluding benefits mentioned in the succeeding Subsection B hereof.
(10)
Taxes assumed by the employer for the employee.
(11)
Regular wages received during a period of sickness or disability.
(12)
Payments to deferred annuity plans, such as Keogh, IRAs or pension
plans, etc.
(13)
National Guard or reserve pay, except active duty.
(14)
Stipends paid to graduate assistants.
(15)
All other forms of compensation for an employee's services.
Neither the kind nor rate of payment, nor the manner of employment,
exempts an employee from the tax.
(16)
All non-cash fringe benefits accruing by virtue of employment
and recognized as taxable by the Internal Revenue Service.
B.
Without intending to alter or change the aforesaid definition,
the following are not considered to be earned income and are not subject
to the earned income tax:
(1)
Sickness, disability or retirement benefits received from annuities,
Keogh, IRAs and pension plans, except regular wages as provided in
the preceding Subsection A(11).
(2)
Payments made under any public assistance or unemployment compensation
legislation, workers' compensation or occupational disease acts or
similar legislation by any government.
(3)
Compensation or bonuses paid by a State or the United States
for active military service in the Armed Forces.
(4)
Death-benefit payments to any employee's beneficiary or estate,
whether payable in a lump sum or otherwise.
(5)
Proceeds of life insurance policies.
(6)
Cash or property received as a gift, by will or by statutes
of descent and distribution and voluntary offerings made by individuals
for the performance of baptisms, wedding ceremonies, etc., which are
received by clergymen, evangelists or religious workers.
(8)
Rents derived from mere passive or investment ownership or subleasing
of real estate without the furnishing by the lessor of services to
the leased premises or to the lessee other than gas, electricity,
water, sewage and heat. Such rents are considered to be the return
solely from invested capital and not profits from operation of a business
activity or enterprise. Furnishing of services to common portions,
and general preservations, of rented real estate shall not make rents
described in this subsection taxable.
(9)
Value of meals and lodging furnished to domestics or other employees
by the employer for the latter's convenience.
(11)
Social security benefits.
(12)
Subchapter S corporation earnings.
(13)
Payments received from annuities and deferred income plans.
(14)
Damages for personal injuries.
(15)
Scholarships and fellowships.
(16)
Payments made by employers or labor unions, including payments
made pursuant to cafeteria plans qualifying under Section 126 of the
Internal Revenue Code of 1986 (Public Law 99-514), 26 U.S.C. § 125,
for employee benefit programs covering hospitalization, sickness,
disability or death, supplemental unemployment benefits or strike
benefits, provided the plan complies with all applicable statutory
and regulatory provisions enforced by the IRS.
EMPLOYER
An individual, copartnership, association, corporation, governmental
body or unit, agency or any other entity who or which employs one
or more persons on a salary, wage, commission or other compensation
basis.
NET PROFITS
A.
The net income from the operation of a business, profession
or other activity, except corporations, determined under Section 303
of the Act of March 4, 1971 (P.L. 6, No. 2), known as the "Tax Reform
Code of 1971," as amended, and regulations in 61 Pa. Code, Part I,
Subpart B, Article V (relating to personal income tax). The term does
not include income which is not paid for services provided and which
is in the nature of earnings from an investment. For taxpayers engaged
in the business, profession or activity of farming, the term shall
not include:
(1)
Any interest earnings generated from any monetary accounts or
investment instruments of the farming business.
(2)
Any gain on the sale of farm machinery.
(3)
Any gain on the sale of livestock held 12 months or more for
draft, breeding or dairy purposes.
(4)
Any gain on the sale of other capital assets of the farm.
B.
Examples of net profits, without intending to alter or change
the aforesaid definitions, or to limit such definition to these examples,
are:
(1)
The net profits of a business or profession or other activity,
operations conducted by an individual as computed according to the
laws, regulations and procedure for computing state income tax, net
profits or net farm profits as required to be reported on State Income
Tax Form Pa. 40.
(2)
Receipts reportable for State income tax purposes as derived
from a fiduciary, partnership or joint venture (Federal Form 1065),
except any portion thereof resulting from things not covered by this
Part, such as capital gains, real estate rentals or interest as otherwise
set forth herein.
(3)
Royalties received by authors, inventors, copyrights, etc.
(4)
Net profits from the operation of hotels, motels, trailer camps,
tourist homes, boardinghouses and other similar businesses.
(5)
Net profits from the business of renting personal property or
real property.
(6)
All other net profits of an enterprise, venture or other activity,
whether such activities are conducted within or outside the taxing
district.
PERSON
Every natural person, corporation, copartnership, firm, fiduciary
or association. Whenever used in any clause prescribing and imposing
a penalty, the term "person," as applied to associations, shall mean
the partners or members thereof, and as applied to corporations, shall
mean the officers thereof.
RESIDENT
An individual, corporation, copartnership, association or
other entity domiciled in the Township of Jefferson, Butler County,
Pennsylvania.
TAXABLE YEAR
The taxable period on the basis of which a taxpayer or claimant
is required to file his income tax return or, if he is not required
to or does not file a tax return, the calendar year.
TAXPAYER
A person, whether an individual, corporation, copartnership,
association or any other entity, required hereunder to file a return
of earned income or net profits or to pay a tax based thereon.