Payroll Policies

PR15 Local Earned Income Tax

Policy Status: 

Active

Policy Steward: 

Corporate Controller / Payroll

Contents:

PURPOSE:

To provide information to employees of the University concerning the local earned income tax laws.

LOCAL EARNED INCOME TAX DEDUCTION:

A deduction is withheld from each salary check for local earned income tax. The tax is remitted monthly to the Centre Tax Agency.

EMPLOYEE'S WITHHOLDING ALLOWANCE CERTIFICATE (W-4):

The W-4 is completed by each new employee to provide information to the University so that his or her local earned income tax withholding can be determined. The University is thus authorized to make the appropriate payroll deductions for the local earned income tax. Whenever an employee moves from one taxing district to another, it is necessary that a new W-4 form be completed by the employee and sent to the Payroll Department.

RESPONSIBILITY FOR SUBMITTING LOCAL EARNED INCOME TAX RETURNS:

Annually, the University furnishes each of its employees with a W-2 statement showing the detail of all earnings and deductions for the year. The total amount deducted for local earned income tax is shown on this statement. It is each individual employee's responsibility to file his/her local earned income tax return. If the employee has lived in more than one local taxing district, it is his/her responsibility to file a return in all of them. The University shall not be responsible for local earned income tax adjustments between local taxing districts which may arise when its employees move from one taxing authority to another.

REFUNDS AND CREDITS:

The tax payer (employee) may obtain an adjustment by application to the treasurer of the borough or township in which he or she resides. Such adjustments will be in the form of either a refund or a credit against future tax liability. In no case should an employee of the University seek an adjustment from the University.

MEALS:

The equivalent value of meals furnished University employees at the convenience of the University are excluded from the local earned income tax base.

FURTHER INFORMATION:

For questions, additional detail, or to request changes to this policy, please contact the Payroll Office.

Effective Date: January 1, 1987 
Date Approved: January 1, 1987 
Date Published: January 1, 1987 (Editorial changes- October 24, 2013)

Most Recent Changes:

  • October 24, 2013 - Editorial changes. Addition of policy steward information, in the event that there are questions or requests for changes to the policy.

Recent History (and effective dates):

  • May 29, 2013- Editorial change; updated verbiage in "LOCAL EARNED INCOME TAX DEDUCTION" section to reflect that local taxes, once collected, are remitted to the Centre Tax Agency for disbursement to the local tax authorities.
  • June 14, 2006 - Revision History added.
  • February 22, 1987 - removed "Postdoctoral Fellowships" section. Renamed "Employee's Withholding Exemption Certificate (W-4)" section to "Employee's Withholding Allowance Certificate (W-4)" section.
  • April 17, 1978 - Major revisions to the policy, including renaming of policy from "Local Wage Tax" to "Earned Income Tax."