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merchandise purchased for resale and the cost of the salaries or commissions paid to his employees for making the actual sales of the goods, commodities or merchandise.

  • J.

    "Dividends." Any distribution made by a corporation to its shareholders in respect of its stock, whether ordinary, extraordinary or in liquidation.

  • K.

    "Employee." Any officer of a corporation and any individual who, under the usual common-law rules applicable in determining the employer-employee relationship has the status of an employee. Generally, a person will be considered to be an employee if he is included by the taxpayer as an employee for the purposes of the payroll taxes imposed by the Federal Insurance Contributions Act; except that, since certain individuals are included within the term "employees" in the Federal Insurance Contributions Act who would not be employees under the usual common-law rules, it may be established that a person who is included as an employee for purposes of the Federal Insurance Contributions Act is not an employee for purposes of this definition.

  • L.

    "Factors and Commission Merchants." A factor, or commission merchant, is an agent employed to sell goods or merchandise consigned or delivered to him, by or for his principal, for a consideration commonly called factorage or commission. Factors, or commission merchants, as distinguished from selling agents, or merchandise brokers, are deemed to be engaged in a financial business, and shall include in the tax base the gross income derived from operations carried on in such capacity. A factor, or commission merchant, differs from a selling agent, or merchandise broker, in the following respects:

    • 1.

      A factor, or commission merchant, may sell for his principal in his own name as well as in the name of his principal. On the contrary, a selling agent, or merchandise broker, acting as such, may sell only in the name of his principal.

    • 2.

      A factor, or commission merchant, is entrusted with possession, management and control of the goods, and has a special property in, and lien on, the goods. The selling agent, or merchandise broker, on the contrary, usually has no such possession, management or control of the goods, nor any such special property or lien.

  • M.

    “Financial Business." The services and transactions of private banks and bankers; building and loan associations; savings and loan associations; credit unions; savings banks; banks; bank and trust companies; trust companies; investment companies registered as such with the Federal Securities and Exchange Commission; holding companies; persons registered under the act of December 5, 1972 (P.L. 1280, No. 284) known as the Pennsylvania Securities Act of 1972, including traders, dealers and brokers in money, credits, commercial paper, bonds, notes, securities and stocks, and monetary metals; factors and commission merchants; consumer discount companies; sales finance companies; purchase money lenders.

  • N.

    "Foreign Commerce." In general, foreign commerce includes trade between the United States and foreign countries. Trade with territories and possessions of the United States is also considered to be foreign commerce.


(Rev. 08/01)

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