Sterling Act Tax Credit
Section 503(b)(2) of the Taxpayer Relief Act requires each school district subject to Section 324 to certify to PDE the total amount of tax credits under Section 324(2) on or before December 15 of each year.
School districts that levied an earned income and net profits tax in 2019-2020 (except Philadelphia City SD) are to certify the tax credited to school district residents who are subject to the tax on 2019 wages, commissions, and other compensation imposed by the City of Philadelphia under the Sterling Act.
A school district that did
not levy an earned income tax in 2019-2020 is
not eligible for the credit on 2019 wages, commissions and other compensation. However, all school districts should file the certification with PDE even if there is no credit to report.
Using the Excel spreadsheet below, school districts should certify the following information
to PDE by December 15, 2020:
- 2019 wages, commissions, and other compensation earned within the City of Philadelphia
plus wages earned outside of Philadelphia but not taxed by the resident school district because of application of the Philadelphia wage tax credit and
- The school district's 2019-2020 earned income tax rate.