 Pennsylvania State Tax Summary
Sales Taxes
State Sales Tax: 6% (food; clothing, text books, heating fuels, prescription and non-prescription drugs exempt) Other taxing entities may add up to 1%.
Gasoline Tax: 25.9 cents/gallon
Diesel Fuel Tax: 30.8 cents/gallon
Gasohol Tax: 25.9 cents/gallon
Personal Income Taxes
Tax Rate Range: Flat rate of 2.8%
Personal Tax Exemptions: None
Standard Deduction: None
Medical/Dental Deduction: None
Federal Income Tax Deduction: None
Retirement Income Taxes: At 59½, Social Security, civil service, state/local government, and private pensions are exempt. IRAs are exempt as are out-of-state government pensions.
Retired Military Pay: Not taxed.
Military Disability Retired Pay:
Disability Portion - Length of Service Pay; Member on September 24, 1975 - No tax; Not Member on September 24, 1975 - Taxed, unless combat incurred. Retired Pay - Based solely on disability: Member on September 24, 1975 - No tax; Not Member on September 24, 1975 - Taxed, unless all pay based on disability and disability resulted from armed conflict, extra-hazardous service, simulated war, or an instrumentality of war.
VA Disability Dependency and Indemnity Compensation: Not subject to federal or state taxes
Military SBP/SSBP/RCSBP/RSFPP: Generally subject to state taxes for those states with income tax. Check with state department of revenue office.
Property Taxes
Property taxes are levied by local governments (counties, municipalities and school districts). The tax cannot exceed 30 mills on the assessed valuation of the property without special permission from the courts. Households with claimants or spouses 65 years of age or older, widows or widowers 50 years of age or older and the permanently disabled 18 years of age or older meeting income eligibility requirements may qualify for this program. Rebates of paid property tax or rent, up to a maximum of $500 per year, are available. To qualify, annual household eligibility income must not exceed $15,000. Act 30-1999 expanded the Property Tax/Rent Rebate program by excluding 50% of Social Security payments and 50% of Railroad Retirement benefit payments from eligibility income. Call 717-787-8201 for details.
Inheritance and Estate Taxes
The Pennsylvania inheritance tax is calculated at a percentage of the value of the assets transferred which is determined by the relationship of the heir to the decedent and the decedent's date of death. The tax rate is 4.5% for transfers to direct descendants (lineal heirs), 12% for transfers to siblings, and 15% for transfers to other heirs (except charitable organizations, exempt institutions, and government entities). Property owned jointly between husband and wife is exempt from the tax, while property inherited from a spouse, or from a child 21 or younger by a parent is exempt. The estate tax is related to federal estate tax collection.
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