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Navigating taxes is not a small fit. And love it or leave it, taxes play a major role in a lot of our decisions. I get questions like, “Is Pennsylvania free of taxes?” And the answer is No. Pennsylvania is not tax-free. It has a flat income tax rate of 3.07% as well as a 6% sales tax. There are also local taxes in some areas. So, taxes are collected at both the state and local levels.

However, there are currently seven U.S. states with no income tax. They include Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming. These other states have other types of taxes like Tennessee and New Hampshire, which only tax interest and dividends income.

The next major question is “What is a deduction checklist for Pennsylvania?”

Well, some of the major deductions available to taxpayers in Pennsylvania include:

1. Home mortgage interest

2. Property taxes paid

3. State and local income taxes or sales taxes

4. Charitable contributions

5. Unreimbursed employee business expenses

6. Gambling losses (up to the amount of reported gambling winnings)

7. Medical and dental expenses over 10% of adjusted gross income

8. Childcare expenses for working parents

9. 529 college savings contributions

10. Moving expenses (if job-related)

11. Teacher classroom expenses

It is imperative to keep records and receipts for these qualified expenses to help any Pennsylvania taxpayers maximize eligible write-offs and deductions to reduce their state-taxable income. If you are having any challenges or you are not sure what to do, Campaign for Working Families has investment from the IRS to help taxpayers free of charge. CWF has IRS-certified tax professionals who will prepare your taxes for FREE. Contact them today at cwfphilly.org.

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