Local Services Tax General Info

·         Effective in East Petersburg Borough beginning January 1, 2010

·         Employers must withhold the tax based on the number of annual payroll periods (ex: biweekly payroll     must be withheld at $2 per payroll/ 26 times annually)

·         Employers are required to submit the tax quarterly. Due dates are:

1st Quarter due April 30             

2nd Quarter due July 31               

3rd Quarter due October 31

 4th Quarter due January 31

·         If an employee resigns or is terminated during the year, the employer is not responsible for collecting the remainder of the tax. It is the responsibility of any new employer to withhold the remainder of the tax due from future paychecks

·         If an employee has multiple employers, the primary employer should deduct the tax (the employee is responsible for completing an exemption form which should be filed with the non-primary employer to avoid having the tax deducted by both employers. If the employee fails to do so, it is the responsibility of the employee to file for a refund at the end of the year).

·         If an employee begins employment during the year and has not had the tax deducted by another employer, the first withholding must be a lump sum to “catch up” on the amount the employee owes to date. The remaining withholdings would then be the same amount per paycheck as other employees.

·         Exemptions/refunds are available for the following reasons (all exemption/refunds must provide supporting documentation):

*Earns less than $12,000

*Multiple employers

*Active Duty Military

*Military Disability (100% disability only)

·         Self-Employed Individuals must comply by April 30 or as soon as the $12,000 minimum is met (pay quarterly as employers do, when minimum is met)