Pennsylvania

Tax Rate Range: Flat rate of 3.07%
Personal Tax Exemptions: None
Standard Deduction: None
Medical/Dental Deduction: None
Federal Income Tax Deduction: None
Retirement Income Taxes: Retirement income is not taxed after age 59 1/2 if the person has reached retirement, based on years of service or age. Retired means meeting the requirements of a Pennsylvania eligible plan and separated from service by retiring. Eligible employer-sponsored retirement plans can, but do not necessarily, include employer-sponsored deferred compensation plans; 401(k) plans, thrift plans, thrift savings plans, and eligible welfare plans. Income not taxed includes Social Security benefits and Railroad Retirement benefits; commonly recognized pension, old age retirement benefits paid after becoming eligible to retire, and then retiring. It also includes United Mine Workers' pensions, military pensions, and civil service annuities.
Retired Military Pay: Not taxed after age 59 1/2.
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.
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.

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: 32.2 cents/gallon
Diesel Fuel Tax: 39.2 cents/gallon
Cigarette Tax: $1.35/pack of 20

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 $35,000. The Property Tax/Rent Rebate program allows residents to exclude 50% of Social Security payments and 50% of Railroad Retirement benefit payments from eligibility income. The maximum rebate is $650. Counties may levy an intangible personal property tax, which taxes stocks, bonds and other personal property taxpayers may own. Not all counties levy this tax.

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.
For further information, visit the Pennsylvania Department of Revenue site or call 717-787-8201.