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Pennsylvania taxes at a glance (2026)

Pennsylvania has a flat 3.07% income tax with a standard deduction of $0 (single) / $0 (married). PA levies a flat 3.07% personal income tax on 8 classes of income (wages, interest, dividends, etc.); rate unchanged for 2026 and stable since 2004. NO standard deduction and NO personal exemption - PA does not allow them. Instead, low-income filers may qualify for Tax Forgiveness (Schedule SP credit) which can reduce or eliminate liability (e.g., a single filer with eligibility income up to ~$8,750 owes nothing; thresholds rise with dependents and a joint return adds ~$8,750 for a spouse, plus ~$9,500 per dependent). Retirement income is favorably treated: Social Security is NOT taxed, and distributions from qualified employer pensions, 401(k)s, and IRAs received after retirement age are exempt. LOCAL income taxes are significant and common in PA: most municipalities and school districts levy an Earned Income Tax (EIT, typically ~1%, collected via Act 32) plus a Local Services Tax (often $52/yr). Philadelphia imposes a separate city wage tax (~3.75% for residents in 2026, lower for non-residents) that is NOT part of the state 3.07% and is administered by the city; combined state+local for Philly residents is roughly 6.82%. PA does not allow itemized deductions and does not conform to federal AGI; it taxes compensation on a class-of-income basis.