PENNSYLVANIA, October 6 - ascribed to them in this section, except where the context

clearly indicates a different meaning:

* * *

(3) "Taxable income." 1. (a) In case the entire business

of the corporation is transacted within this Commonwealth, for

any taxable year which begins on or after January 1, 1971,

taxable income for the calendar year or fiscal year as returned

to and ascertained by the Federal Government before special

deductions provided for in sections 241, 242, 243, 244, 245,

246, 247, 248, 249 and 250 of the Internal Revenue Code of 1986

(26 U.S.C. §§ 241, 242, 243, 244, 245, 246, 247, 248, 249 and

250), or in the case of a corporation participating in the

filing of consolidated returns to the Federal Government or that

is not required to file a return with the Federal Government,

the taxable income which would have been returned to and

ascertained by the Federal Government before special deductions

provided for in sections 241, 242, 243, 244, 245, 246, 247, 248,

249 and 250 of the Internal Revenue Code of 1986 (26 U.S.C. §§

241, 242, 243, 244, 245, 246, 247, 248, 249 and 250) if separate

returns had been made to the Federal Government for the current

and prior taxable years, subject, however, to any correction

thereof, for fraud, evasion, or error as finally ascertained by

the Federal Government.

(b) Additional deductions shall be allowed from taxable

income on account of any dividends received from any other

corporation but only to the extent that such dividends are

included in taxable income as returned to and ascertained by the

Federal Government. For tax years beginning on or after January

1, 1991, additional deductions shall only be allowed for amounts

included, under section 78 of the Internal Revenue Code of 1986

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