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    Incentives, Credits, Programs

    ​​Keystone Opportunity Zones

    The Keystone Opportunity Zone (KOZ) Program is an economic development program designed to stimulate investment, economic growth and employment in the commonwealth for development and revitalization. Applicants located or partially located in specially designated, geographi​cally defined KOZ zones are authorized to apply for state and local tax credits, exemptions and tax abatements for a period of time based on the duration of the zone.

    Application
    KOZ Guidelines [PDF]

    Overview

    To receive KOZ/KOEZ tax benefits, an app​lication must be completed and submitted to the PA Department of Community and Economic Development (DCED) by Dec. 31 of each calendar year for which benefits are sought.

    Tax questions may be directed to the Department of Revenue at 717-772-3896 or ra-rveconomic-dev@pa.gov.

    Corporation Taxes

    Forms/Publications

    • RCT-101 KOZ [PDF] - Keystone Opportunity Zone Instruction Booklet for corporate taxes including capital stock/foreign franchise tax and corporate net income tax.

      Corporate taxpayers authorized for Keystone Opportunity Zone (KOZ)/ Keystone Opportunity Expansion Zone (KOEZ) status must first complete Form RCT-101, PA Corporate Tax Report, without regard to KOZ/KOEZ influence.
    • RCT-101

    KOZ/KOEZ Reporting Requirements

    To expedite processing of your Corporate Tax Report and claim credits for KOZ/KOEZ designation, you must file the following documents:

    • RCT-101
    • RCT-101 KOZ [PDF]
    • Current copy of Department of Community and Economic Development Approval Letter for KOZ/KOEZ designation.

    If the aforementioned documents are not provided, processing will be significantly delayed.

    RCT-132/RCT-143 KOZ [PDF] – Keystone Opportunity Zone/Keystone Opportunity Expansion Zone Instruction Booklet for corporation taxes including financial institution shares tax and mutual thrift institutions tax.

    ​Assistance with tax questions pertaining to the reporting requirments may be directed to the Department of Revenue at 717-772-3896 or ra-rveconomic-dev@pa.gov.

    Personal Income Tax

    KOZ/KOEZ Reporting Requirements: Residents, Property Owners and Sole Proprietorships

    • To expedite processing of your PA personal income tax return, you must include all tax schedules and W2/W3 forms with PA-40 KOZ. Failure to provide the department with supporting documentation will result in refund suspension.
    • Single-member limited liability companies (LLCs) considered disregarded entities for federal and PA personal income tax purposes must complete and file PA Schedule KOZ and PA-40 KOZ.
    • Single-member LLCs electing to be treated as S corporations must file PA-20S/PA-65 Information Returns and PA Schedules P-S KOZ.

    PA-40 KOZ – The PA-40 KOZ will be mailed to qualified applicants beginning in mid-December and ending in March.

    If you do not receive your PA-40 KOZ by March 15th., please contact the Department of Revenue’s KOZ Coordinator at 717-772-3896 or ra-rveconomic-dev@pa.gov.

    KOZ/KOEZ Reporting Requirements: Partnerships, S Corporations and Limited Liability Companies

    Please provide the department with a Schedule P-S KOZ and KOZ RCT-101, if applicable, and RK-1/NRK-1 for all petitioners of the exemption.

    • Schedule P-S KOZ [PDF] – Calculation of PA Keystone Opportunity Zone (KOZ) Exempt Income for Partners and Shareholders.
    • P-S KOZ Instructions [PDF] – Supplemental Instructions for Schedule P-S KOZ for qualified businesses classified as partnerships, S corporations and limited liability companies.

    Note for tax preparers: Schedule P-S KOZ is only available online and will not be mailed to qualified businesses.