PA State Non-Resident Return

[Eli]

For Pennsylvania preparers:

This is the first time I prepare a PA State return. The taxpayer only works there. His home is maintained in Texas. Is there anything out of the ordinary to look out for on the return?

Thanks!

Eli

[LisaAnn]

Nothing out of the ordinary............file a PA 40 & W-2S............just make sure you indicate "Non-Resident" on the form. PA return is very basic.

[schirallicpa]

After you breeze thru the very simple PA return, you will wish we all lived in PA. Usually they withhold exactly what they tax. If he's a simple w-2 then you will probably have a zero return. The ATX program may open up extra credit forms, but he won't be eligible. Not sure about your state, but many states give you a credit for taxes paid in another state, so look for that. I live in NY near the PA border, and have quite a few clients working in PA. NY gives a credit for the tax paid to PA. If there is local tax withheld, PA no longer requires that the local returns be filed if they are withholding exactly what the tax is - which they are.

[Eli]

Actually I live in Texas & we have no state return so I like that even better

Thank you both for your input

Eli

[jklcpa]

If the W-2 shows PA wages, use that figure. It will differ from the federal wages because PA doesn't allow deferrals for 401K and similar plans. PA doesn't tax some items like cost of group term life over $50K either, so in many cases the PA wages will be different. PA doesn't allow losses that show up on page one of the return but don't add in to the total. PA does have a flat tax so if all that the taxpayer has is wages, the return should come out to zero balance due and zero refund. ATX drop down box for a nonresident is "Not a resident on 12/31" and the code that populates is 99999.

Depending on the job, your client might have unreimbursed business expenses that would be reported on schedule UE that is linked to the line right below wages on pg 1 of the PA40. If your client has this form, be sure to fill out the employer information completely so the return isn't rejected for missing info.