Pennsylvania Paycheck Calculator

Pennsylvania's personal income tax is unusually simple in structure and unusually unforgiving in application. The rate is a flat 3.07% on taxable compensation — there are no brackets, so a first-year teacher and a surgeon pay the same percentage.

What makes it distinctive is what Pennsylvania does not allow. There is no standard deduction and no personal exemption, so tax applies from the first dollar of wages. Pennsylvania also refuses most federal-style adjustments: contributions to a traditional 401(k) are not deductible for Pennsylvania purposes, meaning your state taxable wages are generally higher than your federal ones. This trips up a lot of people who assume raising their 401(k) contribution cuts every tax line — federally it does, but in Pennsylvania the state tax is unchanged.

On the other side of the ledger, Pennsylvania is one of the most generous states for retirees: it does not tax Social Security benefits, and it does not tax distributions from 401(k)s, IRAs or pensions once you have reached retirement age. The tax is levied on your earning years, then largely disappears.

Pennsylvania's local tax system is one of the most fragmented in the country. Under Act 32, municipalities and school districts levy an Earned Income Tax (EIT) collected through the employer, and the rate depends on where you live rather than where you work. Most people outside Philadelphia land somewhere between 1% and 2% combined.

Philadelphia sits outside the Act 32 system with its own City Wage Tax, which is charged at a notably higher rate and applies to residents wherever they work, and to non-residents on income earned inside the city. For someone earning $75,000, the Philadelphia wage tax alone can exceed the state income tax.

There is also a small Local Services Tax, typically a flat $52 a year, deducted in instalments by employers in participating municipalities.

Because the EIT follows your home address, two colleagues doing the same job at the same office can take home different amounts. If you are comparing a job offer or a move within Pennsylvania, check the specific rate for the municipality you will live in — the Pennsylvania Department of Community and Economic Development publishes an official register.

Pennsylvania is one of a small number of states where employees, not just employers, contribute to unemployment insurance. The employee share is a small percentage of gross wages with no cap, so it appears on every payslip. It is minor in dollar terms but it is another reason a naive federal-only estimate will overstate Pennsylvania take-home pay.

Pennsylvania has no state disability insurance programme and, as of 2026, no state-run paid family leave payroll levy, so those lines do not appear.

For the federal side, the usual rules apply: your 401(k) reduces federal taxable income but not FICA wages, while Section 125 health premiums reduce both. Because Pennsylvania taxes 401(k) contributions at the state level anyway, the state tax saving from contributing more is zero — worth factoring in when you decide how aggressively to contribute.