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FOR IMMEDIATE RELEASE
March 28, 2007

Finance Committee Approves Eminent Domain Measure

Senator Browne's bill would defer tax if gains are reinvested

The Senate Finance Committee today endorsed a bill introduced by its Chairman, Senator Pat Browne, which would provide conditions for the deferment of taxes on gains resulting from eminent domain transactions.

"This bill would provide relief to those property owners who realize a gain on an eminent domain transaction," Senator Browne said. "As it stands now, those property owners lose twice. First, they involuntarily lose their property and then they are taxed if they realize a gain on the transaction. Senate Bill 342 would remedy that."

SB 342 would amend the Tax Reform Code to adopt the provisions of Internal Revenue Code §1033 with respect to involuntary conversions of property.  When property is converted involuntarily and a gain results, recognition of that gain may be deferred to the extent that the gain is reinvested in other property that is similar or related in service or use to the converted property. 

Contact:

Lesley Crozier
(717) 787-1349