State Tax Guide

Pennsylvania State Taxes: A Simple Guide

Pennsylvania has a state income tax, local earned income taxes in many areas, and the usual mix of sales and property taxes. This guide covers the basics for individuals in plain language.

ℹ️Important: This is a general overview. Exact tax rates, rules, and local details change over time. Always rely on official Pennsylvania and local sources or a tax professional for current information.

💰Pennsylvania state income tax

Pennsylvania imposes a state income tax on most types of personal income. Some key ideas:

📋Residents with income over certain thresholds generally must file a Pennsylvania state income tax return

📍Nonresidents may need to file if they earn income from Pennsylvania sources

📝Pennsylvania's rules for what counts as taxable income can differ from federal definitions

📄 Typical filing: You'll typically file a federal Form 1040 and a separate Pennsylvania state return for the same year if you meet the filing requirements.

🏘️Local earned income taxes

Many municipalities and school districts in Pennsylvania impose local earned income taxes on wage and salary income, separate from the state income tax.

→If you live or work in a jurisdiction with local income tax, your employer may withhold it from your paycheck

→You may need to file local returns, depending on where you live and work

📍 Local variation: Local income tax rules are highly specific to the municipality or school district, so check your local tax office or official notices from your employer for details.

🛒Sales and use tax

Pennsylvania has a state sales and use tax that applies to many retail sales of goods and some services, with additional local taxes in certain areas.

→Some items, such as certain groceries and clothing, may be exempt or taxed differently under Pennsylvania law

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If you buy taxable items from out of state or online without being charged sales tax, you may owe use tax to Pennsylvania

💼 Business owners: Businesses that sell taxable goods or services in Pennsylvania generally must collect and remit sales tax to the state and, where applicable, local authorities.

🏠Property taxes

Property taxes in Pennsylvania are administered primarily at the local level by counties, municipalities, and school districts. They are based on the assessed value of real property.

📊Homeowners receive property tax bills from their local taxing authorities

📍Property tax rates and assessment practices can vary significantly across the state

🏡Some homeowners may qualify for tax relief or reductions under state or local programs

📍 Local details: For details, check with your county, municipality, or school district tax office.

🔗Putting Pennsylvania taxes together

A typical Pennsylvania resident may encounter several layers of taxes each year:

1️⃣Federal income tax (Form 1040)

2️⃣Pennsylvania state income tax

3️⃣Local earned income tax (in many areas)

4️⃣Sales and use tax

5️⃣Local property taxes if they own a home

📚 Build your foundation: Understanding core federal concepts-like taxable income and what a tax return is -helps you see where Pennsylvania's rules add extra layers.

Estimate your tax refund

Calculate your federal and Pennsylvania state tax liability.

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