Most states levy an income tax on their residents that is in addition to the federal income tax. Laws vary from state to state but in most states the state income tax is a tax on the annual earnings of individuals, corporations, trusts, limited liability companies, and other legal entities.
There are nine states that do not have a state income tax—including Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming. But New Hampshire levies a tax on capital gains and Washington state recently enacted a tax on extraordinary profits from the sale of financial assets over $250,000.
In Pennsylvania (PA), residents are subject to a state income tax in addition to the federal income tax. The state income tax applies to the annual earnings of individuals, corporations, trusts, limited liability companies, and other legal entities. Pennsylvania has a flat tax system, meaning that it imposes a consistent tax rate across all income levels for individuals. As of the knowledge cutoff date, the rate is 3.07% for individual income tax. Corporate net income tax rates may differ, and there are also provisions for tax credits and deductions that can affect the overall tax liability. It's important for residents and entities in Pennsylvania to understand their tax obligations and file their state income tax returns annually, typically by April 15th, unless an extension is granted.