Pennsylvania state income tax
Pennsylvania has a state income tax. It is flat, with a top marginal rate of 3.07%. Pennsylvania has a flat 3.07% tax on all personal income earned in the state, with no graduated brackets. This rate applies uniformly to wages, salaries, and business income. Capital gains are taxed as ordinary income (no special lower rate).
Does Pennsylvania have a state income tax?
Yes. Pennsylvania taxes individual income on a flat schedule topping out at 3.07%. Pennsylvania has a flat 3.07% tax on all personal income earned in the state, with no graduated brackets. This rate applies uniformly to wages, salaries, and business income.
| Item | Pennsylvania |
|---|---|
| State income tax | Yes, flat |
| Top marginal rate | 3.07% |
| Capital gains | Taxed as ordinary income, up to 3.07% |
| State sales tax | 6% (plus local) |
| Avg. property tax rate | 1.26% of home value |
| Estate / inheritance tax | Inheritance tax |
How does Pennsylvania tax capital gains?
Pennsylvania has no separate, lower rate for capital gains. They are taxed as ordinary income at the same rates as your wages, up to 3.07%, on top of federal capital gains tax. See how capital gains tax works in 2026.
What about retirement income in Pennsylvania?
Retirement income is taxed differently from wages in many states. For how Pennsylvania treats Social Security, pensions, and 401(k)/IRA withdrawals, see Pennsylvania retirement taxes.
Sources
- Pennsylvania income tax rates and brackets: Pennsylvania Department of Revenue / Taxation.
- Pennsylvania capital gains treatment: Pennsylvania tax authority.
- Pennsylvania sales tax: Pennsylvania Department of Revenue.