Established in 1927, the mission of the Pennsylvania Department of Revenue is to fairly, efficiently, and accurately administer Pennsylvania tax and Lottery programs. On an annual basis, the department receives and collects all the Commonwealth of Pennsylvania General Fund tax revenue, which includes processing more than 10 million business and individual tax reports and payments annually. Additionally, the department is also responsible for administering the Pennsylvania Lottery, which remains the only state lottery that designates all its proceeds to programs that benefit older residents.
The Pennsylvania Department of Revenue has been a leader in electronic filing of personal income tax for nearly 30 years. The many benefits electronic filing offers, both to taxpayers and the Department of Revenue, have led to electronic filing becoming commonplace over that time.
Today, however, the Department still receives over 500,000 paper returns annually. The Department seeks to determine who these taxpayers are and the major reasons why they persist in paper filing. Furthermore, this project should explore actions the Department can take to convert this residual paper to digital filing.
Pennsylvania Personal Income Tax Overview:
Pennsylvania personal income tax is levied at the rate of 3.07 percent against taxable income of resident and nonresident individuals, estates, trusts, partnerships, S corporations, business trusts and limited liability companies not federally taxed as corporations.
Pennsylvania taxes eight classes of income: (1) compensation; (2) interest; (3) dividends; (4) net profits from the operation of a business, profession or farm; (5) net gains or income from the dispositions of property; (6) net gains or income from rents, royalties, patents and copyrights; (7) income derived through estates or trusts; and (8) gambling and lottery winnings.
Pennsylvania e-File Overview:
E-filing offers advantages not available to taxpayers filing by paper, including error-reducing automatic calculators; instant confirmation of a successful filing; faster refund processing and direct deposit options.
myPATH: A secure, state-only electronic filing system – offered exclusively through the Department of Revenue – which allows most taxpayers to prepare and submit their Pennsylvania personal income tax return for free.
E-file for free: A safe, convenient online filing option available from reputable vendors that allows qualifying individuals to file their state and federal returns for free. Some income restrictions may apply.
E-file for a fee: Taxpayers can also e-file using commercial tax preparation software from reputable vendors approved through the Fed/State e-file program.
A successful project will be comprised of the following deliverables:
Analysis of historical tax return filing data seeking to identify significant segments of taxpayers filing paper returns.
Analysis of barriers preventing the identified segments from filing electronically.
Recommendations to address the barriers and close the paper filing gap.
2024-2025
