Residents of Pennsylvania, Land of Taxes, pay a bewildering array of taxes.
Updated 01/08/2010 - now with Occ. Tax, LST tax Exemption Forms
In my opinion, Pennsylvania has possibly the stupidest array of local, school, county, and state taxes, with multiple local tax collectors in each municipality (Local Elected, Appointed EIT, Appointed LST), random due dates (State and Local Income in April, County Real Estate in May, School and Local Real Estate, per Capita, and Occupation in October, Local Services Tax every pay period) inconsistent exemption rules, and more. Here I try to explain some of them, with an emphasis on county, school and local taxes.
Pennsylvania State Taxes
2006 State Tax Changes
The state enacted a NEW law providing a reduction in property tax in exchange for legalizing slot machines at casinos. Residents will have to submit an Act 1 Homestead Tax Exclusion form. This pretty much replaces the 2005 Act 72 Plan which was not widely accepted by local school districts.
2005 State Tax Changes
The state enacted a law providing a reduction in property tax in exchange for legalizing slot machines at casinos. Residents will have to submit an Act 72 Homestead Tax Exclusion form. Local school districts have to approve a 0.1% wage tax increase and certain restraints on future tax increases to enact it. And the state has to receive over $900,000,000 in casino tax revenue first. So don't expect to see any property tax reduction until 2006 at the earliest. Click for more info on Act 72.
UPDATE: On May 16, 2005 the Lower Dauphin School Board voted to REJECT participation in Act 72. Absent new legislation by the state, there will be no property tax reduction for Conewago residents under this program.
2004 State Tax Changes
State income tax (and some other state taxes) were increased. Personal income tax increased from 2.8 to 3.07 percent, effective January 1, 2004.
Cigarette tax increased from $1.00 per pack ($.05 per cigarette) to $1.35 per pack ($.0675 per cigarette), effective January 7, 2004.
A 5% tax on instate telephone calls has been extended to interstate calls and cell phones.
I believe the increase in the beer tax did NOT pass.
Senior Citizen Property Tax/ Rent Rebate Program
The Property Tax/Rent Rebate program benefits eligible Pennsylvanians age 65 and older; widows and widowers age 50 and older; and people with disabilities age 18 and older. The program expansion increased the income limit from $15,000 to $35,000 (which excludes half of Social Security income) for homeowners and raises the maximum rebate for both homeowners and renters from $500 to $650. The income limit for renters is $15,000 For more info.
Dauphin County Taxes
Real property taxes are based on the assessed value of real estate. For additional information on asessments, appeals, deferrals, exclusions, and millage rates, see Link to Dauphin County Tax page.
For information on the Homestead/Farmstead Exemption, Act 50 Real Property Tax Deferral, or Clean and Green property tax abatement, click here.
Lower Dauphin School District Taxes
Link to Lower Dauphin Tax page.
Click here to see LDSD Budget.
Local Municipality - Conewago Township Taxes
Click here to see Township Budget.
#1 Elected Local Tax Collector
The Elected Township Tax Collector collects Real Estate Taxes, Per Capita Taxes, and Occupation Taxes for the County, School District, and Township.
A new Tax Collector was elected in November 2009 and began serving in January 2010.
#2 Earned Income Tax Collector
A separate appointed Tax Collection Bureau collects Local Earned Income Taxes which is split between the school district and municipality. Earned income generally includes wages, salary and bonus, but not interest, capital gains, and dividends. Just to keep you confused, the Lancaster Tax Collection Bureau may operate under the name of the old Middletown Area Tax Collection Bureau in our area. In 2012, a different Earned Income Tax Collector, probably Berkheimer Associates, will become the Earned Income Tax COllector for all of Dauphin County.
#3 LST Tax Collector
WHERE YOU WORK, an appointed Tax Collection Bureau collects the Local Services Tax .
Local Services Tax - This very confusing tax may be imposed by the school district and/or municipality where you work, not where you live. It replaces the Emergency and Muncipal Services Tax and before that the Occupational Privilege Tax. The school district portion of this tax is limited to $10, or $5 if the municipality also imposes it. The municipality portion of the tax can be as much as $52, $47 if the school district also imposes it. So the total school and municipal Local Services Tax is limited to $52. If the school district or municipality charge $10 or less per year, it may offer a low-income exemption at a level it chooses. If the municipality charges more than $10 per year it MUST offer a $12,000 low income exemption. It is not collected through the local elected tax collector or the local income tax collector. Instead, it should be withheld from your pay in equal installments throughout the year. ($1/week if you are paid weekly and your tax is $52.) Remember, this tax is assessed where you work, not where you live. So if you work in Derry Township, they will withhold your tax and you have to apply to them for an exemption or refund. If you work in more than one municipality during the year, it gets even more complicated.
For even more info on PA and local taxes
PA TAX FORM SIMPLIFIED|
1 Name __________________
2 Address ________________
3 Earnings this year ________
4 Send it all to us _______________
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© 2003-2010 by Joel Buckley. Revised: 12/03/2010 01:00 pm.