All Philadelphia residents owe the City Wage Tax, regardless of where they work. Non-residents who work in Philadelphia must also pay the Wage Tax.

Why is Philly Wage Tax so high?

What is the wage tax? The wage tax is a percentage taken from workers’ taxable income to pay for city services. For Philadelphia, those who live within city limits pay a slightly higher rate — 3.8712% — than non-residents who work in the city, as residents presumably consume more city services.

Do you pay more taxes if you live in NJ and work in NYC?

Will I Pay Taxes in Both NY and NJ? Not really. While you do have to file taxes with New York and New Jersey, you don’t have to pay double taxes. New Jersey residents will receive a tax credit on their New Jersey return for any tax paid to New York, or another state, on income earned in and taxed to both states.

Who is required to pay the wage tax in Philadelphia?

Who pays the tax. The City Wage Tax is a tax on salaries, wages, commissions, and other compensation. The tax applies to payments that a person receives from an employer in return for work or services. All Philadelphia residents owe the City Wage Tax, regardless of where they work. Non-residents who work in Philadelphia must also pay the Wage Tax.

Where do I pay taxes if I live in PA but work in NY?

Any taxes paid to State of NY will be credited to your State of PA tax return. The “where” part is the state’s dept of taxation or dept of revenue. Generally, you’ll file electronically. PS You will owe slightly more taxes this way versus if your employment was solely in PA.

Do you have to file a Pennsylvania tax return if you work in Philadelphia?

Non-Pennsylvania residents who work in Philadelphia but do not file a Pennsylvania income tax return must include a signed copy of their state income tax return to be eligible for the income-based rates. If you pay more Wage Tax than is due, you can file a claim to have the excess amount refunded to you.

Do you pay PA state tax if you work in NJ?

PA state tax should not have been withheld if Hubby worked in Phila all year. You must file a nonresident PA state tax return to get that back, and then a NJ resident return. NJ will give you at least partial credit for the Phila wage tax. depending upon the respective tax rates.