Frequently Asked Questions

 

What is the Local Services Tax?

The Local Services Tax is a tax levied on individuals who are employed in municipalities or school districts that have enacted the tax.

Who must pay the Local Services Tax?

The Local Services Tax shall be collected through payroll deductions from the employer for all employees. For self-employed individuals, see below.

Are LST Deductions based on where I live or where I am employed?

The Local Services Tax shall be deducted for the municipality or school district in which you are employed.

How and when is the tax deducted from my pay?

If the enacted LST rate exceeds $10, the tax must be withheld on a prorated basis determined by the number of pay periods established by an employer for a calendar year. If the LST rate is $10 or less, the tax may be collected in a lump sum.

What If I am a self-employed individual?

Self-employed individuals must pay their own tax on a quarterly basis, if the rate of tax exceeds $10. If the rate of tax is $10 or less, the self-employed individual will be required to pay their own tax in a lump sum payment.

Am I required to file quarterly?

Per Act 7, anyone with a tax rate greater than $10.00 must file quarterly. However, if you choose to pay the full amount with your first quarter filing, that also will be accepted with all four quarterly filings.

What If I have more than one job?

If a person has more than one job or is employed in more than one jurisdiction, the LST tax would be due to the taxing district in which the person is primarily employed.

Will I have to pay up to $52.00 per each employer?

The total LST paid by an individual in a calendar year is generally limited to $52.00, regardless of the number of taxing districts in which an individual works during the year. There are some distressed areas that have a higher tax rate, click here to find out the rate for area of employment. If you are employed in a distressed area your maximum annual tax paid would equal that areas rate.

How can I request a refund?

A refund can be requested if employed in more than one taxing district and/or more than the maximum tax due was deducted. Send a copy of the LST refund request form and supporting documentation to your local tax office. Click here to download an LST Refund Request form.

Is there a low-income exemption?

If you are employed in an area that has an LST rate that exceeds $10, there is a mandatory income exemption for those whose total earned income and/or net profits are less than $12,000.00 or $15,600 in areas whose rate is greater than $52.00. Please be advised that the same income exemption may not apply for the school district portion of the tax and may result in a reduced refund.

If you believe you will meet the exemption requirement, you must complete and return to us the Exemption Certificate. Click here to download the form.