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Recent Legislation

Recent Legislation

Act 32 of 2008

A study was initiated in 2004 by the Department of Community and Economic Development (DCED) to look at the state's system for collecting earned income tax at the local level. As a result, comprehensive reforms were enacted by the PA General Assembly in July 2008 and signed by the Governor as Act 32. The intent was to recover revenues lost due to the obsolete collection methods and provide municipalities more protections in the collection process. Act 32 reduces the 560 Earned Income Tax (EIT) collection entities across the Commonwealth to 69 Tax Collection Districts (TCD). TCDs are ordinarily designated by the county boundaries, except Allegheny County which will be served by four TCDs. School Districts that overlap county boundaries will be included in the TCD where the majority of its population lives. Each TCD will be governed by a Tax Collection Committee (TCC). Collections under Act 32 will begin January 1, 2012.



What does this mean for employers starting January 1, 2012?

Employers must withhold taxes on behalf of employees, regardless of where that employee resides, and file returns with the Tax Officer selected by the TCD. For employers located in multiple counties, the Act permits the employer to file in a single TCD or multiple TCDs. Many TCDs will collect both the Local Services Tax and Earned Income Tax from employers through a single Tax Officer.

What this means for taxpayers starting January 1, 2012?

In general, as of January 1, 2012, taxpayers who currently file quarterly local earned income tax returns will no longer be required to do so. Per Act 32, their employers must withhold local earned income tax. Taxpayers will still be required to file final returns, reporting the amount of taxes withheld during the tax year. If for any reason an employer is exempt or fails to withhold taxes on behalf of any employee, the employee must still file and pay his or her local earned income taxes quarterly. Also, self-employed individuals must file quarterly returns, make quarterly payments and file a final return.

Keystone Collections Group has been appointed to collect Earned Income Taxes for the Washington County Tax Collection District. The following is a link to a video produced by Keystone Collections Group concerning Act 32.


http://www.youtube.com/watch?v=Xm-ZRvfMgI0

***Please got to the Washington County Tax Collection District website at www.wctcd.org or Keystone Collections website at www.keystonecollects.com for more information.***
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