PA Local Tax Calculator

Act 32 local earned income tax

How your employer picks the local rate

Only 75 of the 2,627 municipality and school district pairs in the state register have no resident earned income tax, and under Act 32 employers withhold the tax for their workers. DCED explains the rule in one line: your employer compares the Total Resident EIT Rate of the municipality where you live with the Work Location Non-Resident EIT Rate of the municipality where you work, and "the applicable EIT rate owed and to be withheld is always the higher of the two rates." The resident rate is the municipal rate plus the school district rate. The nonresident rate belongs to the work municipality only, and 641 of the 2,627 rows in the register have none.

Your employer learns where you live from the Residency Certification Form, which you complete when you are hired and again when you move. The form asks for PSD codes: six-digit numbers that identify each municipality, paired with its school district, so the tax reaches the right place. The calculator shows both codes. If a municipality is split between two school districts, each part has its own row and often its own PSD code, so pick the pair that matches your address. DCED's address search on its Municipal Statistics site confirms which one you are in.

The default example lives in Bethlehem (Bethlehem Area SD, 1% total resident rate) and works in Allentown, whose 1.28% nonresident rate is higher. Allentown's rate is withheld: $768.00 a year on $60,000, $29.54 a paycheck. Of that, $600.00 matches Bethlehem's 1% rate and the other $168.00 comes from Allentown's higher nonresident rate. DCED's return instructions warn that when you work where the nonresident rate is higher than your resident rate, you may not be able to claim the whole amount withheld against your home tax.

Rates in the largest cities

Most Pennsylvanians pay 1%: 1,820 of the 2,627 register rows have a 1% total resident rate. Cities are the exception, and their nonresident rate is often lower than what their own residents pay.

From the DCED EIT / PIT / LST tax register (official rates as of June 15, 2026). Philadelphia: wage tax rates effective July 1, 2026, from the DCED real-time register and the City of Philadelphia. Pittsburgh's 3% resident rate is the 1% city rate plus the 2% Pittsburgh School District rate.

The Local Services Tax

The Local Services Tax is a flat yearly amount charged by the municipality and school district where you work, not where you live. In the register, 1,329 rows charge a combined $52, 684 charge nothing, and the two highest are Harrisburg and Scranton at $156. DCED's rule for payroll: if the combined rate is more than $10, the employer must spread it over the pay periods of the year and may not take it as a lump sum; if it is $10 or less, it may come out of the first paycheck. A $52 tax on a biweekly payroll is $2.00 a paycheck.

Each political subdivision that levies more than $10 must exempt people whose earned income and net profits from all sources within it are less than $12,000 for the year. A few set a higher limit (Harrisburg's is $24,500 and Scranton's $15,600), and a school district's exemption can differ from the municipality's. To use it, file an exemption application with your employer; if your pay later passes the limit, the employer withholds a catch-up amount. If you work in several places, the LST goes to your primary place of employment.

Philadelphia is different

Philadelphia collects its own wage tax outside Act 32. DCED's rules: employers withhold the Philadelphia resident rate for people who live in Philadelphia, wherever in Pennsylvania they work, and the Philadelphia nonresident rate for people who work in the city but live elsewhere. From July 1, 2026 those rates are 3.735% and 3.425%. If you live elsewhere in Pennsylvania and pay the Philadelphia wage tax, the DCED return instructions let you use it as a credit against your home EIT, with no refund of any excess. That usually wipes out the home tax; a resident of Reading, whose total rate is 3.6%, would still owe $105.00 on $60,000. The Philadelphia wage tax guide and the Philadelphia salary calculator cover the city side.

Working from home, out of state or on the road

A home office counts as a worksite: DCED lists the residences of home-based employees among business sites, so tick "I work from home" and your home rates apply to both sides. If you live in another state and work in Pennsylvania, your resident PSD code is 880000 and your resident rate is 0%, so the work location nonresident rate and the LST apply. If you live in Pennsylvania and work for an employer outside the state, that employer does not have to withhold, but you still owe your total resident rate through quarterly estimates or your annual return. For employees who move between job sites, the employer uses the location of the permanent home office for assignments under 90 consecutive days and the job location from 90 days on.

What pay is taxed, and the annual return

The local tax follows Pennsylvania's definition of compensation, not your federal wages. DCED's return instructions list salaries, wages, commissions, bonuses, tips and employee contributions to retirement accounts as taxable, so a 401(k) deferral does not lower your local tax base. Social Security, unemployment compensation, pensions, interest, dividends and cafeteria plans are not taxed. Enter your gross pay with those points in mind.

Everyone subject to the tax files an annual local earned income tax return by April 15, even when nothing is due, with the tax collector for each tax collection district where they lived during the year. The calculator names the EIT collector the register lists for your home municipality. Compare your take-home pay with the Pennsylvania salary calculator or Pennsylvania salary after taxes, read the Pennsylvania local earned income tax guide and the Pittsburgh Local Services Tax guide, or see how other states handle it in local income tax by state. Cross-border commuters can start with work in New Jersey, live in Pennsylvania, work in New York, live in Pennsylvania or the state reciprocity agreements list.