Pennsylvania Take-Home Pay Calculator 2025: Federal + PA Flat State Tax + Local EIT

Pennsylvania flat rate: simplest state tax in the country

The Pennsylvania Personal Income Tax (PIT) is 3.07 percent of taxable compensation. Taxable compensation is wages, salaries, tips, commissions, and similar earned income; Pennsylvania does not allow a standard deduction, personal exemption, or itemized deductions from gross wages. The PA-40 form is short by US-state standards, and most Pennsylvania filers can complete it in 20 to 30 minutes once they have their W-2.

The 3.07 percent rate has been unchanged since 2004 (it was 2.8 percent before that, raised to address state budget pressures). A 2018 Pennsylvania Constitution amendment requires that any income tax must be at a uniform rate (no graduated brackets) and applied to all classes of taxpayer equally, which is why Pennsylvania cannot adopt graduated brackets without a constitutional amendment. This structural feature makes Pennsylvania's flat-rate system unusually durable.

Act 32 and local Earned Income Tax

Pennsylvania's Act 32 (effective 2012) standardised municipal Earned Income Tax collection across the state. Almost every Pennsylvania municipality and school district levies an EIT on wages earned by residents (and a nonresident EIT on wages earned within the jurisdiction by nonresident workers, although nonresidents typically pay the lower rate).

For Philadelphia residents, the city wage tax is 3.75 percent on resident wages and 3.44 percent on nonresident wages earned in the city. Pittsburgh residents pay 1.0 percent to the city plus 2.0 percent to the local school district, totalling 3.0 percent. Suburban municipalities and school districts typically charge a combined 1.0 to 1.5 percent. The maximum local EIT (combined city + school district) is generally capped at around 3.9 percent under Act 511, with Philadelphia's wage tax operating under a separate statutory framework that allows the higher 3.75 percent rate.

Local EIT is withheld from your paycheck by your employer through the Pennsylvania Tax Collector for the political subdivision where you live. Employers in multiple municipalities must use the higher of the resident or work-location rate (the so-called "reciprocity" rule under Act 32).

How PA differs from federal pre-tax treatment

401(k) contributions are not deductible from Pennsylvania taxable income in the year contributed. Pennsylvania taxes 401(k) contributions when earned and exempts distributions in retirement (the opposite of federal). For a $10,000 annual 401(k) contribution by a Pennsylvania resident, the federal saving is $2,400 to $3,700 (depending on bracket) and the Pennsylvania saving is zero (contributions are still taxed at 3.07 percent in the contribution year). At retirement, Pennsylvania does not tax 401(k) distributions, but federal taxes apply.

HSA contributions reduce federal taxable income but not Pennsylvania taxable income. Pennsylvania is one of three states (with California and New Jersey) that do not conform to federal HSA treatment. The mismatch costs roughly 3 percent of HSA contributions in additional state tax.

Roth IRA contributions reduce neither federal nor Pennsylvania taxable income, the same as anywhere else.

Traditional IRA contributions are not Pennsylvania-deductible (similar to 401(k)).

FSA, dependent care, commuter benefits generally reduce both federal and Pennsylvania taxable income via Section 125 cafeteria plans.

This calculator's "401(k) contribution" and "HSA contribution" inputs assume federal treatment (both are subtracted from taxable income for federal computation). For Pennsylvania state and local tax, the calculator applies the state rate to the gross wage minus only those items Pennsylvania allows; in practice, this means PA state tax is slightly higher than a strict-federal-conforming approximation would suggest.

Property tax in Pennsylvania

Property tax in Pennsylvania averages about 1.36 percent of home value annually statewide, ranking 10th highest in the US. Specific counties vary widely: the Philadelphia suburbs (Montgomery, Bucks, Chester) average 1.5 to 1.8 percent, Pittsburgh (Allegheny County) averages 2.1 percent, and rural counties run 0.7 to 1.0 percent. For a $300,000 home, expect $3,000 to $5,500 of annual property tax depending on location.

Pennsylvania property tax is federally deductible up to the $10,000 SALT cap. Most Pennsylvania homeowners have combined SALT (state + local + property tax) below or near the cap, so property tax is more often federally deductible in Pennsylvania than in high-tax-state homeowners like New York or Illinois.

Philadelphia wage tax: the largest single Pennsylvania deviation

The Philadelphia City Wage Tax is the largest municipal wage tax in the US that does not also include broader state income tax stacking. The 2025 rate is 3.75 percent for Philadelphia residents and 3.44 percent for nonresidents who work in the city. The wage tax has been declining slowly: it was 4.5625 percent in 1995 and has been reduced incrementally for two decades as part of a tax-cut policy aimed at retaining city residents and businesses.

For a $100,000 Philadelphia resident, the city wage tax alone is $3,750 per year, on top of $3,070 of state tax for a combined $6,820 or 6.82 percent effective state-plus-local rate. A move from Philadelphia to suburban Montgomery County (1.0 percent EIT) saves roughly $2,700 annually for a $100,000 earner.

What this calculator does not include

Municipal Earned Income Tax (add 1.0 to 3.9 percent to state rate depending on municipality; Philadelphia 3.75 percent, Pittsburgh 3.0 percent). PA 401(k) non-conformity (PA taxes contributions, exempts distributions; opposite of federal). PA HSA non-conformity (federal-deductible only). Local Services Tax (small flat per-payroll-period tax, typically $52/year for municipalities that levy it). School District Income Tax (variable, mostly handled through EIT). PA property tax. Federal SALT cap impact. PA-specific tax credits (Tax Forgiveness Credit for low-income filers, Educational Improvement Tax Credit donations). For precise PA returns, use the PA-40 form or full-featured tax software; this calculator covers the wage-income paycheck case at the flat state rate plus any local rate you choose to add.