PENNSYLVANIA, February 4 - applying the three-factor apportionment formula as provided

in Department of Revenue personal income tax regulations

applicable to income apportionment in connection with a

business, trade or profession carried on both within and

outside this Commonwealth.

(2) Net gains or income, less net losses, derived by a

resident or nonresident of an affordable energy development

zone from the sale, exchange or other disposition of real or

tangible personal property used by a qualified business and

located in an affordable energy development zone and as

determined in accordance with accepted accounting principles

and practices. The exemption provided in this paragraph shall

not apply to the sale, exchange or other disposition of any

stock of goods, merchandise or inventory or any operational

assets unless the transfer is in connection with the sale,

exchange or other disposition of all of the assets in

complete liquidation of a qualified business located in N

affordable energy development zone. This paragraph shall

apply to intangible personal property employed in a trade,

profession or business in an affordable energy development

zone by a qualified business but only when transferred in

connection with a sale, exchange or other disposition of all

of the assets in complete liquidation of the qualified

business in the affordable energy development zone.

(3) In the case of gains, less net losses, in paragraph

(2), the exemption shall be prorated based on the percentage

of time, based on calendar days, the property located in an

affordable energy development zone was held by a resident or

nonresident of the affordable energy development zone during

the time period the affordable energy development zone was in

20210SB0161PN0142 - 9 -

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