Recovering Delinquent Earned Income Tax

Keystone’s compliance team continues to issue delinquent earned income tax notices to taxpayers across Pennsylvania. State law requires Pennsylvania residents with earned income or net profits to report and pay the local earned income tax quarterly and file an annual return by April 15. If taxpayers do not file a local return, there is no time limit on the number of past years for which they may legally be liable for delinquent earned income taxes.

In certain instances, taxpayers may not be required to remit additional payment, but they must submit documentation to show evidence that the tax is not due. For example, the tax may not be owed if the taxpayer:

  • Paid the tax to the wrong Pennsylvania community and only needs to move it to the correct jurisdiction
  • Worked outside of Pennsylvania and was subject to another state’s income tax during the tax year(s) indicated
  • Reported income on the state tax return (PA-40) that is not subject to local tax
  • Did not live in the community indicated on the delinquent tax notice for the tax years identified on the notice

Taxpayers who meet any of the above criteria can submit the required supporting documents to dispute a claim online using Keystone’s e-Pay. Access our uploading documentation FAQ for step-by-step instructions. View our Delinquent Earned Income Tax FAQs to find additional information about the delinquent earned income tax recovery process.