Pennsylvania charges a flat 3.07% state income tax, one of the lowest flat rates in the country, but it comes with a twist most states don't have.
Pennsylvania taxes your 401(k) contributions and gives essentially no deductions, and many towns add a local earned-income tax on top. Here is how the flat rate really works on your paycheck. See your exact take-home with the free Pennsylvania paycheck calculator.
How Pennsylvania's income tax works
Pennsylvania applies a single 3.07% rate to nearly all compensation. There is no standard deduction and no personal exemption, so the rate hits almost your entire wage. The simplicity is the upside: your state tax is easy to predict at any income.
The unusual part is that Pennsylvania does not let you defer 401(k) contributions for state purposes. Money you put into a traditional 401(k) lowers your federal taxable income but is still taxed by Pennsylvania in the year you earn it, so your state wages are typically close to your full gross.
Your take-home on a $65,000 salary in Pennsylvania
Here is how a $65,000 salary breaks down for a single filer, using 2025 federal and FICA figures alongside Pennsylvania's a flat 3.07% income tax.
| Item | Annual |
|---|---|
| Federal income tax | $5,246 |
| FICA (Social Security + Medicare) | $4,973 |
| Pennsylvania income tax | $1,996 |
| Take-home pay | $52,787 |
| Percent of gross kept | 81.2% |
On a $65,000 salary a single filer owes about $1,996 in Pennsylvania income tax and keeps roughly $52,787 (81.2% of gross), before any local earned-income tax. Compare with Ohio.
Local earned-income tax and the 401(k) quirk
Most Pennsylvania municipalities and school districts levy a local earned-income tax, commonly 1%, and Philadelphia's wage tax is much higher (around 3.75% for residents). That local layer can rival or exceed the state tax, so factor in where you live and work.
On the bright side, because Pennsylvania already taxed your 401(k) going in, qualified retirement distributions are generally Pennsylvania-tax-free later, and the state does not tax Social Security.
How to keep more of your Pennsylvania paycheck
An HSA still reduces both your federal tax and FICA, but remember a traditional 401(k) only shelters your federal tax in Pennsylvania, not your state tax. That changes the math slightly versus most other states.