PA Question

[S T]

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

[marlenew]

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

[KBTS]

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.

[S T]

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

[BP.]

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.

[KBTS]

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.

[lovesledz]

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.

[S T]

Thank you!

Sandy