Wednesday, November 23, 2022

What Is The Sales Tax In Philadelphia

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The Judicial Mortgage Foreclosure Sheriff Sale is the process by which mortgage companies and other financial institutions seek to collect debts owed to them, particularly in instances where a homeowner defaults on his/her mortgage payments. As with Tax Sales, Foreclosure Sales allow individuals the opportunity to bid on properties and become homeowners.

Fast Facts In Philadelphia

Area Codes — Philadelphia and its suburbs’ telephone area codes are 215, 267, 484, 610, and 835. Lancaster County and the Pennsylvania Dutch region use area code 717.

Business Hours — Philly banks are generally open Monday through Friday from 9am to 5pm, with some open Saturday from 9am to noon. TD Banks offer extended hours and are open Sunday. Most bars and restaurants serve food until 10 or 10:30pm. Those near Rittenhouse Square and in Old City tend to stay open later, and some Chinatown places stay open until 3am. Bars must close at 2am. Offices are open Monday through Friday from 9am to 5pm. Stores are open daily from about 10am to 7pm most Center City shops keep doors open later on Wednesday evenings. Old City, Rittenhouse Square, South Street, and Northern Liberties are the most active late-night districts.

Doctors — Most hotel concierges will be able to point you toward medical care.

Drinking Laws — The legal age for purchase and consumption of alcoholic beverages is 21 proof of age is required and often requested at bars, nightclubs, and restaurants, so it’s always a good idea to bring ID when you go out. Do not carry open containers of alcohol in your car or any public area that isn’t zoned for alcohol consumption. The police can fine you on the spot. Don’t even think about driving while intoxicated.

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Philadelphia Sales Tax Rate

Find the current Philadelphia Sales Tax Rate. The Sales Tax Rate include state, county taxes & city taxes, and also special taxes.

What is the Sales Tax in Philadelphia, PA?

The current Philadelphia Sales Tax Rate is 8.00%, and the tax has been in place since 1953.The minimum combined sales tax rate for Philadelphia is 8.00%, and includes the Pennsylvania 6.00% Sales Tax, Philadelphia County 2.00% tax rate, and the local tax rate of 0.00%.Pennsylvania has a origin-based sales tax, and the sales tax rates are determined by the location of the vendor, not by the location of the buyer.

The Philadelphia sales tax rate of 8.00% applies this zip codes: 19099, 19101, 19102, 19103, 19104, 19105, 19106, 19107, 19108, 19109, 19110, 19111, 19112, 19114, 19115, 19116, 19118, 19119, 19120, 19121, 19122, 19123, 19124, 19125, 19126, 19127, 19128, 19129, 19130, 19131, 19132, 19133, 19134, 19135, 19136, 19137, 19138, 19139, 19140, 19141, 19142, 19143, 19144, 19145, 19146, 19147, 19148, 19149, 19150, 19151, 19152, 19153, 19154, 19160, 19176, 19179, 19181, 19183, 19192, 19194 and 19244.

We strive to offer the most accurate tax rates available, but tax rates are subject to change, and you should also check your local government tax offices for the current city, county, and state tax rates. No warranty is made as to the accuracy of information provided.

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Distinguishing Goods From Nontaxable Items

Since services and intangibles are typically not taxed, the distinction between a taxable sale of tangible property and a nontaxable service or intangible transfer is a major source of controversy. Many state tax administrators and courts look to the “true object” or “dominant purpose” of the transaction to determine if it is a taxable sale. Some courts have looked at the significance of the property in relation to the services provided. Where property is sold with an agreement to provide service , the service agreement is generally treated as a separate sale if it can be purchased separately. Michigan and Colorado courts have adopted a more holistic approach, looking at various factors for a particular transaction.

Employer And Employee Taxes For Your Pennsylvania Llc

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If you pay employees, there are some slightly different tax implications. Speak to your accountant to get clear guidance for your own unique situation.

All employers must collect and withhold payroll tax from their employees when they receive their salaries. You would normally withhold 7.65 percent of the taxable salary that you pay to your employees.

You may also choose to withhold federal and Pennsylvania state income tax on the wages you pay to employees. Speak to your accountant for more information.

Regardless of whether you withhold federal and Pennsylvania state income tax, your employees may need to file their own tax returns.

You may also need to pay insurance for any employees, like employee compensation insurance or unemployment tax. There will also be other requirements you have for employees.

Also Check: Form 1040 State Tax Refund

What Should You Do Before You Bid

  • Take a close look. It is strongly recommended that persons planning to bid at the sales make a site visit to the property prior to the sale. Many persons have bid on vacant lots thinking that they were bidding on a property containing residential structures. The City is not authorized to permit or arrange for entry into properties listed for Sheriff Sales. Generally, properties are sold free and clear of liens and encumbrances. However, some properties are sold subject to other liens. You take subject to those liens to the extent they remain unpaid.
  • In order to buy a property from any tax sale, you must be tax-compliant. Proof of compliance must be provided at the time of final settlement.
  • Consider the rehab costs. While there are some bargains to be had at Sheriff Sales, potential bidders, especially those seeking residential properties, are cautioned that the condition of properties may vary widely.

What Goods And Services Are Considered Taxable In Pennsylvania

The following items are all taxable in the state of Pennsylvania:

  • Sales of tangible goods at retail.
  • Repairs or alterations of tangible personal property.
  • Property rentals, leases, or licenses
  • Selling service warranty contracts.

Lets now review some of our clients frequently asked questions:

  • Is Pennsylvania an Origin or Destination sales tax State?
  • What creates a sales tax nexus in Pennsylvania?
  • What is the economic threshold in Pennsylvania?
  • Does Amazon have fulfillment centers in Pennsylvania?
  • Does Pennsylvania have a ?

To best understand your tax obligations, new businesses need to consider how they are doing business and the type of relationships they have with buyers and any third parties to their transactions.

Lets discuss some questions that will help you understand the nature of your small business and the subsequent tax implications.

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Filing And Paying Sales Tax In Pennsylvania

It is time to talk about filing and paying your sales taxes in Pennsylvania. In this section, We are going to cover the following frequently asked questions from our clients:

  • When is Pennsylvania Sales Tax due?
  • What are the Pennsylvania Sales Tax thresholds?
  • What if a Pennsylvania Sales Tax filing date falls on a weekend or holiday?
  • How do I file a Pennsylvania Sales Tax Return?
  • How do I correct a Pennsylvania Sales Tax return?
  • What happens if I dont collect sales tax?
  • What happens if I file or pay my sales tax return late?
  • Do I need to file a return if I dont collect any sales tax in Pennsylvania?
  • If I close my business, do I need to file a final sales tax return?
  • Does the Pennsylvania Department of Revenue offer a discount for filing on time?

Collection Payment And Tax Returns

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Sales taxes are collected by vendors in most states. Use taxes are self assessed by purchasers. Many states require individuals and businesses who regularly make sales to register with the state. All states imposing sales tax require that taxes collected be paid to the state at least quarterly. Most states have thresholds at which more frequent payment is required. Some states provide a discount to vendors upon payment of collected tax.

Sales taxes collected in some states are considered to be money owned by the state, and consider a vendor failing to remit the tax as in breach of its fiduciary duties. Sellers of taxable property must file tax returns with each jurisdiction in which they are required to collect sales tax. Most jurisdictions require that returns be filed monthly, though sellers with small amounts of tax due may be allowed to file less frequently.

Sales tax returns typically report all sales, taxable sales, sales by category of exemption, and the amount of tax due. Where multiple tax rates are imposed , these amounts are typically reported for each rate. Some states combine returns for state and local sales taxes, but many local jurisdictions require separate reporting. Some jurisdictions permit or require electronic filing of returns.

Purchasers of goods who have not paid sales tax in their own jurisdiction must file use tax returns to report taxable purchases. Many states permit such filing for individuals as part of individual income tax returns.

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Is Honey Tax Free

Products Exempt from Sales Tax Collection Farmers do not need to collect sales tax on farm and food products intended for human consumption this includes: all fresh and processed foods: fruits, vegetables, baked goods, jellies, jams, preserves, meats, eggs, dairy products, syrup, honey , cider, etc.

What Are The Pennsylvania Sales Tax Filing Interval Thresholds

The thresholds for filing intervals are based on the expected or actual tax liability owed:

*anticipated if new business, actual if existing company

Not sure how to determine your tax filing frequency?

You can review your eCommerce or Point-of-Sale Software to see the volume of sales you have generated.

Don’t worry though! The state will let you know when your due dates change. 🙂

Keep an eye out for notices in your mail from the State of Pennsylvania so that you don’t miss any shift in deadlines.

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Sales And Use Tax In Pennsylvania

There are two key tax types businesses selling goods and services in Pennsylvania should be well-versed in: sales tax and use tax. Businesses should be well versed in both to be sure to stay compliant with Pennsylvania state and local tax laws. This guide aims to assist by summarizing key tax topics in an easy to read format.

What Happens If I Dont Collect Sales Tax

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If you were required to collect sales taxes and failed to do so for whatever reason, thats a big no-no! Ultimately the business will be held liable for the due tax. Always be sure to collect sales tax at the point of sale. Attempting to collect after the fact will be time consuming and most likely unsuccessful.

Protip: You are still responsible for remitting sales taxes even if you failed to collect them.

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How Do I Learn Which Properties Are To Be Sold

All properties that are court-ordered to be sold at Sheriff Sales are advertised in the Legal Intelligencer and on a rotating basis in a paper of general circulation. You can also view a list of properties to be sold at Sheriff Sale online .

The Philadelphia Land Bank will be bidding on certain properties that have been identified on the Sheriff Sale list. The Land Bank’s bids are known as “priority bids,” which are authorized by the Commonwealth’s Land Bank Act.

The properties the Land Bank will be bidding on are being offered for sale at the City’s opening bid. However, because the Land Bank has the exclusive right to acquire these properties, no bids other than the Land Bank bids will be accepted.

What Is Pennsylvania Sales Tax On Cars

Buying or selling a vehicle may seem like a small task, but it’s easy to get bogged down in the fees and legal papers that follow a sale. The Pennsylvania sales tax on cars can significantly raise the cost of a vehicle, and making sure the vehicle is legal for you to drive takes a little legwork.

Buying or selling a vehicle may seem like a small task, but it’s easy to get bogged down in the fees and legal papers that follow a sale. The Pennsylvania sales tax on cars can significantly raise the cost of a vehicle, and making sure the vehicle is legal for you to drive takes a little legwork. Before you buy or sell a vehicle, know your way around the Pennsylvania sales taxes and the paperwork needed to make your vehicle street-legal.

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Do I Have To Pay Philadelphia City Tax If I Live In Nj

The New Jersey/Pennsylvania Reciprocal Agreement does not apply to income or wage tax imposed and collected by the City of Philadelphia or any other municipality in Pennsylvania. That means a New Jersey resident who works in Philadelphia and pays city wage taxes can claim a credit for the taxes paid to Philadelphia.

What Income Is Not Taxable In Pennsylvania

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Pennsylvania fully exempts all income from Social Security, as well as payments from retirement accounts, like 401s and IRAs. It also exempts pension income for seniors age 60 or older. While its property tax rates are higher than average, the average total sales tax rate is among the 20 lowest in the country.

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Does Pennsylvania Have Economic Nexus

Yes, Pennsylvania does now have an economic nexus law. As of July 1st, 2019, remote sellers are liable to pay sales tax beyond a certain threshold. This means that even businesses without a physical presence or traditional nexus can be required to register for, collect, and pay sales taxes.

The threshold for registering is having a cumulative gross revenue of over $100,000 in a year to Pennsylvania purchasers.

For more information see the Pennsylvania DOTs remote sellers page here.

What Are The Current Pennsylvania Sales Tax Rates

Pennsylvanias state-wide sales tax rate is 6% at the time of this articles writing, with a couple local surtaxes potentially bringing that amount up to 8%. Since sales tax rates may change, we advise you to check out the Pennsylvania Department of Revenue Tax Rate page which has the current rate. Any change will be reflected on that page.

It always helps to be accurate and up to date with this type of information! 🙂

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How Do You Pay The Philadelphia Income Tax

The Philadelphia income tax is due on April 15th, when you file your federal and state tax returns. Because calculating your local income tax is relatively simple compared to your other tax returns, many tax preparers will file your Philadelphia income tax return for free.

If you file your own taxes, the Philadelphia tax collector will likely mail you a copy of the tax forms you need by April. Unfortunately, many leading e-file providers do not support local income taxes. Philadelphia may have a proprietary e-filing system you can use alongside your state and federal e-filing provider.

Does Pennsylvania Have A Sales Tax Holiday

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Nope, no break at all from Pennsylvanias vigilant tax watchdogs 😐

*****

We have now covered who you need to collect sales taxes from, how to determine whether goods for sale are deemed taxable, what goods and services fall under tax exemptions, who is eligible for tax exemption certificates, and, finally, the process of collecting sales tax in Pennsylvania state.

Now that were this far down the rabbit hole theres only one thing we need to learn about next how to pay the piper!

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Extra Sales Tax With The Motor Vehicle Understated Value Program

The MVUVP allows the Department of Revenue to tack on more sales tax to vehicle purchases. This will be done if they deem the sale price to be much lower than the market value of the vehicle. This program was created by the Pennsylvania government to target those who attempt to sell cars well below market value in order to lower the sales tax on the purchased vehicle.

According to the Department of Revenue, the fair market price of a vehicle is decided not by the seller or buyer of the vehicle but by the Pennsylvania state government. Before listing a vehicle for sale or buying a privately sold vehicle, it’s a good idea to check the Pennsylvania Department of Revenue’s website to read about this program and find the fair market value of the vehicle you’re considering selling or buying.

Taxable And Exempt Shipping Charges

Pennsylvania sales tax may apply to charges for shipping, handling, delivery, freight, and postage.

Delivery charges are considered part of the sales price in Pennsylvania. That means the taxability of shipping charges depends on the contents of the shipment.

Generally, charges to prepare and deliver taxable tangible personal property to a location designated by the consumer are taxable in Pennsylvania. This is true even if the delivery charges for taxable goods are separately stated.

Charges associated with the delivery of exempt goods are generally exempt.If a shipment contains both taxable and exempt goods, the shipping and handling charges for the entire shipment are subject to tax.

Tax may also apply to drop shipping scenarios. If you use drop shipping to deliver items to customers in Pennsylvania, you may be responsible for collecting and reporting tax.

The DOR recommends keeping clear invoices and records for all transactions, with specific terms to describe delivery-related charges. Acceptable forms of documentation include but are not limited to:

  • Bills of lading

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