Pennsylvania law requires every employer located or transacting business in Pennsylvania to withhold Pennsylvania. SSDI benefits are taxable, while SSI benefits are not.Pennsylvania has a flat individual income tax rate of 3.07 percent, meaning that every resident pays the same rate regardless of their income level. The Wage Tax must be filed quarterly and paid on a schedule that corresponds with how much money is withheld from employees' paychecks. PA ABLE is a savings program offering people with qualifying disabilities a way to save that does not affect their means-tested benefits. Your employer should not include periodic payments for sickness or disability in Box 16 of your W2 Form. Federal and state law authorized the creation of PA ABLE accounts. I claim exception from withholding because: a. If you are claiming out-of-state tax credits, calculate PA taxable wages using the above formula. Do not use the figure in W-2 Box 1.
