Taxes

June 9, 2013 

Here’s a road map of taxes you will encounter as a resident of Centre County. This list covers individual taxes only. There also are various business taxes.

REAL ESTATE TAXES

School districts, the county and your municipality (either a township or borough) split the proceeds from the annual real estate tax, with your school district getting the biggest share.

The county assessment office establishes the market value of real estate, and the three tax rates in mills are levied on half of that value.

A mill generates $1 in tax for every $1,000 of assessed taxable value.

For example, a Bellefonte resident with a home valued at $100,000 would multiply total millage (67.0589) by half the market value of the home ($50,000) and divide by 1,000 for a total tax bill of approximately $3,353.

The tax rates are determined by elected officials of the school district, municipality and county.

County and municipal real estate tax bills are mailed in March. Those for the school districts vary, but are mailed between July 1 and Aug. 15.

EARNED-INCOME TAX

A tax on earned income varies from .50 to 2.55 percent, depending on your municipality and school district.

File an annual tax return the Centre Tax Agency, operated through State College Borough. The agency provides tax collection for Centre County municipalities.

LOCAL SERVICES TAX

School districts and municipalities can levy this tax on people who work in the district or municipality.

The tax can be as high as $52, with $5 going to the school district and the rest going to the municipality.

Anyone earning less than $12,000 is generally exempt from the tax, along with active-duty military personnel and honorably discharged veterans with a 100 percent service-connected disability.

STATE TAXES

Pennsylvania levies a flat 3.07 percent income tax and a 6 percent sales tax.

The income tax is paid through payroll withholding. The sales tax is placed on most goods and services other than groceries and clothing. The hotel occupancy tax is the same rate as the sales tax and applies to room rental charges for stays of less than 30 days by the same person.

REAL ESTATE TRANSFER TAX

Real estate transfer taxes add up to 2 percent in all but three Centre County municipalities. The state gets 1 percent and the school district and municipality evenly split the other 1 percent.

The rate totals 2.75 percent in Ferguson Township and State College, with the municipality receiving 1.25 percent and the school district .5 percent. The rate totals 1.5 percent in Taylor Township, with the municipality receiving .5 percent and the school district none.

PER-CAPITA TAX

Another tax is a $5 or $10 per capita tax on each resident age 18 and older in 13 of Centre County’s municipalities and a $10 per capita tax in the Bald Eagle Area and Philipsburg-Osceola Area school districts.

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