An Act amending the act of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of 1971, in personal income tax, further providing for classes of income.

HB 1177 amends Pennsylvania's Tax Reform Code of 1971 to clarify that specific government service income is excluded from the definition of "compensation" for personal income tax purposes. The bill explicitly removes from taxable compensation income earned from active duty with the U.S. armed forces outside Pennsylvania, the U.S. Public Health Service, NOAA, or Pennsylvania emergency duty (including under state emergency management laws). This change directly affects Pennsylvania residents who receive these government service payments, ensuring they are not classified as taxable compensation under current law. The bill does not alter tax rates or brackets but refines the tax code's definition of taxable income to align with federal and state service structures.