The local services tax on my PA paycheck is a flat annual charge, capped at $52 a year, levied by the municipality where you work rather than where you live. It is not a percentage, it does not rise with your salary, and it is a different thing entirely from the local earned income tax that sits near it on the same pay stub.
A flat dollar amount, not a rate
This is the part that confuses people, because every other line on the pay stub is a percentage. The LST is a fixed annual sum set by the municipality, and the state caps the total at $52 per person per calendar year no matter how many jurisdictions you work in.
When the combined municipal and school rate is more than $10, employers must spread it across your pay periods rather than taking it in one lump. Pennsylvania sets that out explicitly: divide the annual amount by the number of pay periods and round down to the nearest cent.
LST per paycheck
per period = annual LST ÷ number of pay periods
A $52 tax is $1.00 weekly, $2.00 biweekly or $4.33 monthly
So the largest it can ever be on a biweekly check is two dollars. If your LST line is bigger than that, either your employer is collecting it as a lump sum because the combined rate is $10 or under, or something is wrong.
It follows your desk, not your home
The LST is a work-site tax. Employers with a work site inside the taxing jurisdiction deduct it from employees at that site, which means the municipality that receives it is the one you commute into. Ohio splits the same way, except in reverse: its school district tax follows where you live.
That is the opposite of how people expect a local tax to behave, and it is also the opposite of the residency-based rules in states like New York. Live in one Pennsylvania township and work in another, and the LST goes to the one with your office in it.
Two jobs do not mean two full charges. The $52 cap is per taxpayer per year across every jurisdiction, not per employer. If a second employer starts deducting it and you have already paid the maximum elsewhere, you can claim it back, and nothing in the system will notice on your behalf.
The low-income exemption almost nobody claims
Any political subdivision levying an LST above $10 must exempt taxpayers whose total earned income and net profits from all sources within that subdivision is under $12,000.
The exemption is not automatic. It works on a certificate you file with your employer, so a part-time or seasonal worker below the threshold who never files one simply pays it. On a small income $52 is not nothing, and it is among the easiest refunds in Pennsylvania to leave unclaimed.
The LST is not the EIT
Two local deductions, similar names, completely different mechanics. Getting them mixed up is the usual reason a Pennsylvania pay stub looks wrong.
- Local Services Tax: a flat dollar amount, capped at $52 a year, based on where you work.
- Earned Income Tax: a percentage of your wages, set locally, with resident and nonresident rates and its own rules about which jurisdiction gets it.
The EIT is the larger of the two by a wide margin, and it is the one worth checking carefully after a move or a job change.
Pennsylvania paycheck deductions on $60,000
On $60,000 paid biweekly, before any local lines:
| Line | Per paycheck | Rate | Per year |
|---|---|---|---|
| Gross pay | $2,307.69 | — | $60,000.00 |
| Federal income tax | −$193.08 | varies with your W-4 | −$5,020.00 |
| Social Security | −$143.08 | 6.2% | −$3,720.00 |
| Medicare | −$33.46 | 1.45% | −$870.00 |
| Pennsylvania income tax | −$70.85 | 3.07% flat | −$1,842.10 |
| PA unemployment | −$1.62 | employee share | −$42.00 |
| Take-home | $1,865.62 | 80.84% of gross | $48,506.12 |
The state rate really is flat. On $30,000 the state takes $921, on $60,000 it takes $1,842 and on $130,000 it takes $3,991, which is 3.07 percent every time. The unemployment line is small and unusual: most states charge unemployment to the employer only, and Pennsylvania takes a little from the employee too.
Worth knowing before you use any paycheck calculator for Pennsylvania. Ours shows the state and unemployment lines but not the LST or the EIT, because both are set by your individual municipality rather than by the state. Expect your real check to be a little lower than any general calculator suggests, by up to $2 a period for the LST and by whatever your local EIT rate comes to.
Getting it back when you have paid twice
The $52 ceiling is annual and per person, so the two situations where you can overpay are both worth watching for.
The first is changing jobs partway through the year. Your new employer starts deducting from zero, because it has no way of knowing what the old one already took, and between them they can pass the cap. The second is holding two jobs at once in different municipalities, where both deduct and neither can see the other.
Pennsylvania has a refund application for exactly this, and it also covers the low-income case where the exemption certificate went in late or not at all. Nothing about it is automatic, so it only happens if you notice. Keep the final pay stub from an old job, because it is the evidence you need and the hardest thing to get hold of afterward.
Checking your own
Find the line
It appears as LST, Local Services Tax, or occasionally still as EMST or Occupational Privilege Tax, which are the names it used before. A dollar or two a period, unchanging, is what you are looking for.
Check it stops
Because the annual total is capped, the deduction should end once you have paid the year’s amount, and restart in January. A line that runs at the same rate all year without stopping is worth querying.
Look it up rather than guess
Rates vary by municipality and school district, and the state publishes a lookup by address for exactly this reason. That is the only reliable way to know what your own combined rate should be.
The Pennsylvania paycheck calculator covers the state and federal lines, and the take-home pay by state calculator puts Pennsylvania beside other states, though neither can include a municipal rate that only you know.
See the rest of your Pennsylvania check
Frequently asked
A flat annual charge capped at $52 a year, levied by the municipality where you work rather than where you live. It is spread across your pay periods, so it is at most $1 a week or $2 on a biweekly check.
A maximum of $52 per person per calendar year across all jurisdictions combined. The exact amount is set by your municipality and school district, and the state publishes a lookup by address.
Where you work. Employers with a work site in the taxing jurisdiction deduct it at that site, so the municipality with your office in it receives it, not the one you live in.
Yes, if your total earned income and net profits within that subdivision are under $12,000 and the LST there exceeds $10. The exemption is not automatic, so you have to file a certificate with your employer to get it.
The LST is a flat dollar amount capped at $52 a year based on where you work. The Earned Income Tax is a percentage of your wages with separate resident and nonresident rates. The EIT is much the larger of the two.