The Philadelphia School Income Tax is back

Although the School income tax has been in force for at least the last 30 years, it often is ignored by taxpayers and at times the City

Based upon a few recent calls, the Philadelphia School District is apparently embarking on a revitalized enforcement program for the School Income Tax (Form S-1).  The enforcement  of this unpopular tax on City Residents tends to reappear after a prolonged period of hibernation. Usually the resurgence coincides with a time  when the School District has budget issues. If you are a City resident you should be filing Form S-1 annually. We suggest filing even when the liability is zero so the statute of limitations begins to run. There is no statute running on an unfiled tax form. The S-1 taxes certain investment income such as some classes of interest; dividends; short term capital gains(Less than 6 months ); rents and pass thru income from partnerships and S Corporations.

(.039240 is the tax rate or $392.40 per $10,000 of taxable income)

If you recently relocated into Philadelphia, you should be aware of this additional income tax.

January 30, 2014