Exceptions to Withholding Requirements

The following are exceptions to the Local Services Tax (LST) employer withholding requirements where the total LST is $52.

Multiple Employers

Do not withhold the School District ($5) or Municipal ($47) LST if you have received a properly executed Employee Statement to Secondary Employers notifying you that:

  • The LST has been withheld by another employer.
  • The LST is being withheld by another employer who is the employee's principal employer.
  • The employee is also self-employed and is remitting the LST to the tax office on his/her behalf.

Military Service Exemption

Do not withhold the School District ($5) or Municipal ($47) LST if you have received a properly executed Annual Exemption Request Form for which exemption is based on military service.

Clergy Exemption

Do not withhold the School District ($5) or Municipal ($47) LST if you have received a properly executed Annual Exemption Request Form for which exemption is attributed to clergy based employment.

Income Based Exemption

Do not withhold the Municipal ($47) LST if you have received a properly executed Annual Exemption Request Form indicating the employee expects to receive less than $12,000 in total earned income and net profits from employment within the work site municipality. The income exemption level for the Bald Eagle Area School District is $1,500. Consequently, employers are required to withhold the School District LST ($5) provided an employee's total income is equal to or greater than $1,500. The income exemption level for the Bellefonte Area School District is $1,000. Consequently, employers are required to withhold the School District LST ($5) provided an employee's total income is equal to or greater than $1,000. 

Additional Information

Please note, the State College Area School District does not have an income exemption.

The Annual Exemption Request Form must include documentation that the employee earned less than $12,000 within the same work site municipality during the prior year.

$10 Rate Table 

For employers which are located within a district with a total LST of $10, please view a chart (PDF) that will assist you with determining the correct amount of LST to deduct from the employee(s).