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    PA Question

    For those PA preparers

    I am preparing a part year PA return, only income to PA is a Govt Pension, which as I understand is not taxable to PA, and then $ 228 in interest.

    Return for PA is showing $ 7 due based on the $ 228 interest earnings.

    Would this be correct?

    Thanks

    Sandy

    #2
    Correct -- sounds like your client would be eligible for PA SP Tax Forgiveness to apply to the $7 or a zero tax.

    Comment


      #3
      In calculating PA tax forgiveness, you have to include certain income from the other state as well. Your software may handle this for you, or you may have to manually enter the info.

      Comment


        #4
        Can't believe PA is going to tax on interest only part year

        Pension - Govt so would be exempt??

        I am only left with the interest

        Yes -- right SP won't work too much income from State of VA before retirement

        So do PA residents "all" have to file a return on interest earned and pay a tax??

        Using Drake - any assistance would be appreciated -



        Thanks

        Sandy

        Comment


          #5
          Originally posted by S T View Post
          So do PA residents "all" have to file a return on interest earned and pay a tax??
          More or less, yes. Unless, as posters noted, SP Tax Forgiveness applies. Filing threshold is $33 in income, whether tax is due or not. So, even little kids with bank accounts in their names need to file, even if the tax is just a few bucks.

          Comment


            #6
            Originally posted by S T View Post
            Can't believe PA is going to tax on interest only part year

            Pension - Govt so would be exempt??

            I am only left with the interest

            Yes -- right SP won't work too much income from State of VA before retirement

            So do PA residents "all" have to file a return on interest earned and pay a tax??

            Using Drake - any assistance would be appreciated -



            Thanks

            Sandy
            Drake should handle this fine. Enter "PY" for the state on federal screen, enter the dates of residency on PA screen 1, and use PA as the state on the INT screen. If the return does not qualify for tax forgiveness, you could verify by going to PA screen "SP" and changing the box at the bottom to force the schedule to produce. You should see the non-resident income on line 6 of schedule SP.

            Comment


              #7
              Originally posted by S T View Post
              For those PA preparers

              I am preparing a part year PA return, only income to PA is a Govt Pension, which as I understand is not taxable to PA, and then $ 228 in interest.

              Return for PA is showing $ 7 due based on the $ 228 interest earnings.

              Would this be correct?

              Thanks

              Sandy
              What is the distribution code on the 1099? If it is code 4 for death, that will be included in income for calculating the PA SP.

              Comment


                #8
                Thank you!

                Sandy

                Comment

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