Consistency of local income tax reporting and payment with state income tax:
Farmers and their professional tax preparers have been significantly frustrated by the inconsistency of rules for filing, reporting and periodic payment of local income tax with the rules established for state income tax. Local income tax laws do not provide for many of the same rules provided under federal and state income tax laws that simplify reporting and payment of taxes by taxpayers and specially simplify reporting and payment of taxes by farmers:
- Providing farmers the option to make a single filing and payment of estimated tax, instead of quarterly filings and payments.
- "Safe harbor" allowance for payment of estimated tax based on taxpayer's income from the previous year.
- Option for "paper filing" of income and estimated tax returns.
- Conforming deadlines for filing and payment of estimated tax to state and federal deadlines.
- Allowance for use of standardized tax return forms, instead of requirements for use of a form specially developed by an individual local taxing district.
Senate Bill 356, introduced by Senator Mike Folmer, is the same legislation as the Senate-passed version of Senate Bill 491 supported by Pennsylvania Farm Bureau last term, which would make rules for reporting and payment of local income taxes virtually the same as those for state income taxes.
PFB is urging Senators and Representatives, especially those in the Senate and House Finance Committees, to support and promptly pass the legislation contained in Senate Bill 356, to amend local income tax laws to make the governing rules for reporting and payment of tax consistent with state reporting and payment rules.