PA
Pennsylvania House Bill HB1703

Pennsylvania 2025-2026 Regular Session

Pennsylvania House Bill HB1703

Introduced
7/8/25  

Caption

In personal income tax, further providing for definitions, providing for elective tax imposed at pass-through entity level and further providing for taxability of partners, for income of a Pennsylvania S corporation and for income taxes imposed by other states.

Impact

If enacted, HB 1703 would amend existing tax law to introduce new definitions and provides a specific structure for the taxation of pass-through entities. This change could simplify the compliance process for many businesses operating under pass-through structures, but it also introduces new complexities regarding the taxation of partners and S corporations. The intent is to streamline taxation at the entity level rather than at individual partners, potentially easing the burden on personal income tax filings for those affiliated with these businesses.

Summary

House Bill 1703 centers on personal income tax regulations, specifically focusing on definitions related to taxation of pass-through entities. The bill proposes an elective tax that would be imposed at the pass-through entity level, as well as addressing the taxability of partners and the income generated by Pennsylvania S corporations. This legislation aims to clarify tax obligations for entities operating in Pennsylvania and may significantly impact how income tax is collected from these respective entities.

Sentiment

The sentiment among lawmakers and stakeholders surrounding HB 1703 appears to be cautiously optimistic. Supporters of the bill advocate for it as a means to foster a clearer and potentially more efficient tax collection process. They argue that it could incentivize business growth by reducing ambiguities in existing tax regulations. However, there are also concerns regarding the implications of such tax changes on local businesses and their ability to adapt to new regulations, indicating a mix of support and apprehension among different interest groups.

Contention

Despite its potential benefits, HB 1703 faces contention, particularly regarding how the new taxation structures may affect various stakeholders in the business community. Some critics argue that the changes could disproportionately impact smaller businesses who might struggle to adapt to the new framework, raising concerns about equity in the tax system. Additionally, there may be debates regarding the appropriateness of implementing an elective tax at the entity level, with calls for further discussions to ensure that the bill aligns with the overall economic interests of the state.

Latest HB1703 Activity

Companion Bills

No companion bills found.

Previously Filed As

PA HB1584

In personal income tax, further providing for definitions, providing for elective tax imposed at pass-through entity level and further providing for taxability of partners, for income of a Pennsylvania S corporation and for income taxes imposed by other states.

PA SB659

In personal income tax, further providing for definitions, providing for elective tax imposed at pass-through entity level and further providing for taxability of partners and for income of a Pennsylvania S corporation.

PA SB660

In personal income tax, further providing for income taxes imposed by other states.

PA HB1636

In personal income tax, further providing for imposition of tax and for taxability of estates, trusts and their beneficiaries.

PA SB815

In personal income tax, further providing for imposition of tax and for taxability of estates, trusts and their beneficiaries; and, in corporate net income tax, further providing for manufacturing innovation and reinvestment deduction.

PA SB269

In personal income tax, further providing for imposition of

PA HB1773

In personal income tax, further providing for imposition of tax and for amount of withholding tax.

PA HB166

In personal income tax, further providing for imposition of tax.

PA HB2452

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.

PA SB1106

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.

Similar Bills

PA HB1584

In personal income tax, further providing for definitions, providing for elective tax imposed at pass-through entity level and further providing for taxability of partners, for income of a Pennsylvania S corporation and for income taxes imposed by other states.

PA SB659

In personal income tax, further providing for definitions, providing for elective tax imposed at pass-through entity level and further providing for taxability of partners and for income of a Pennsylvania S corporation.

PA SB396

In personal income tax, further providing for definitions, providing for elective tax imposed at pass-through entity level and further providing for taxability of partners and for income of a Pennsylvania S corporation.

PA HB1649

Eliminating school district property taxes; imposing county and school district taxes; establishing the School District Emergency Fund and the School District Property Tax Elimination Fund; consolidating Articles II and III of the Tax Reform Code of 1971; in preliminary provisions relating to sales and use tax, providing for definitions; in taxation generally relating to sales and use tax, providing for exclusions and for transfer to county sales and use tax accounts; in preliminary provisions relating to personal income tax, providing for definitions; and making repeals.

PA HB1773

In personal income tax, further providing for imposition of tax and for amount of withholding tax.

PA HB177

Providing for the creation of keystone opportunity dairy zones to facilitate the economic development of Pennsylvania's dairy industry; authorizing expenditures; providing for tax exemptions, tax deductions, tax abatements and tax credits; creating additional obligations of the Commonwealth and local governmental units; prescribing powers and duties of certain State and local departments, agencies and officials; and imposing penalties.

PA HB500

In Pennsylvania Economic Development for a Growing Economy (PA EDGE) Tax Credits, repealing provisions relating to local resource manufacturing, providing for Reliable Energy Investment Tax Credit, repealing provisions relating to Pennsylvania milk processing and providing for Pennsylvania milk processing; in regional clean hydrogen hubs, further providing for definitions, for eligibility, for application and approval of tax credit, for use of tax credits and for applicability; in semiconductor manufacturing and biomedical manufacturing and research, further providing for definitions and for application and approval of tax credit and providing for geothermal energy and for sustainable aviation fuel; and, in application of Prevailing Wage Act, further providing for definitions.

PA HB995

Providing for the creation of keystone opportunity dairy zones to facilitate the economic development of Pennsylvania's dairy industry; authorizing expenditures; providing tax exemptions, tax deductions, tax abatements and tax credits; creating additional obligations of the Commonwealth and local governmental units; prescribing powers and duties of certain State and local departments, agencies and officials; and imposing penalties.