Pennsylvania Working Tax Credit 2025: Complete Guide & Calculator

Nearly one million Pennsylvania workers just became eligible for hundreds of dollars in extra tax relief.

If you’re among the 940,000 Pennsylvanians earning a modest income, you could receive up to $805 back when you file your 2025 taxes starting in January 2026.

Governor Josh Shapiro signed this new Working Pennsylvanians Tax Credit (WPTC) into law on November 12, 2025, as part of the state’s 2025-26 budget.

The credit represents a significant shift in Pennsylvania’s tax policy—the first major anti-poverty initiative in the state’s income tax system in over 50 years.

Here’s everything you need to know about this new tax credit, who qualifies, how much you can get, and exactly how to claim it.

What Is the Working Pennsylvanians Tax Credit?

The WPTC is a refundable state tax credit that puts money directly into the pockets of low- to moderate-income workers. It’s modeled after the federal Earned Income Tax Credit (EITC), one of the nation’s most effective anti-poverty programs.

The state credit equals 10% of whatever you receive from the federal EITC. This means if you qualify for $4,000 from the federal credit, you’ll automatically receive an additional $400 from Pennsylvania—no extra paperwork required.

What Makes It “Refundable”?

This is crucial: even if you don’t owe any Pennsylvania income tax, you can still receive this credit as a cash refund. Many working Pennsylvanians earn just enough to get by but not enough to accumulate a significant state tax bill.

The refundable nature ensures that these workers—the ones who need relief most—actually benefit.

Think of it this way: if your Pennsylvania tax bill is $200 but you qualify for a $500 WPTC, you’ll receive a $300 refund check. The credit doesn’t just reduce what you owe; it can put real money in your bank account.

How Much Money Can You Get?

The maximum credit is $805, but your actual amount depends on three factors: your filing status, your income, and the number of children or dependents you have.

Maximum Credit Amounts by Number of Children:

• Three or more qualifying children: Up to $805
• Two qualifying children: Up to $715
• One qualifying child: Up to $432
• No qualifying children: Up to $65

These amounts are 10% of the maximum federal EITC for each category. For example, a single parent with three children earning around $18,000 annually could receive the full $805 state credit on top of their federal credit of $8,046—totaling $8,851 in tax credits.

Who Qualifies for the Pennsylvania Working Tax Credit?

If you already qualify for the federal Earned Income Tax Credit, you automatically qualify for the state version. Here’s what that means in practical terms.

Basic Eligibility Requirements:

You must have earned income from work—wages, salaries, tips, or self-employment income. Investment income like dividends and interest doesn’t count, and you cannot have more than $11,950 in investment income for 2025.

You must be a U.S. citizen or legal resident for the entire year.

You must have a valid Social Security Number (not an Individual Taxpayer Identification Number).

You cannot file as “Married Filing Separately” unless you meet specific IRS exceptions for separated spouses.

You must live in Pennsylvania and file a PA-40 state tax return.

Income Limits for 2025:

Your eligibility depends on your adjusted gross income (AGI), filing status, and number of qualifying children. Here are the maximum income thresholds:

For Single Filers, Head of Household, or Qualifying Surviving Spouse:

• No children: $19,104
• One child: $50,434
• Two children: $56,947
• Three or more children: $61,555

For Married Filing Jointly:

• No children: $26,214
• One child: $57,554
• Two children: $63,057
• Three or more children: $68,675

For example, a married couple with two children earning $60,000 combined would qualify, but if they earned $65,000, they would not.

Special Requirements Without Children:

If you don’t have children, you must also:

• Be between 25 and 65 years old at the end of the tax year
• Have lived in the United States for more than half the year
• Not be claimed as a dependent on someone else’s return

If you’re married filing jointly without children, only one spouse needs to meet the age requirement.

What Counts as a “Qualifying Child”?

Your child must meet all of these tests:

Relationship: Your son, daughter, stepchild, adopted child, foster child, brother, sister, or a descendant of any of these (like a grandchild or niece).

Age: Under 19 at year’s end (or under 24 if a full-time student for at least five months). There’s no age limit for children who are permanently and totally disabled.

Residency: Must have lived with you in the United States for more than half the year.

Support: The child cannot file a joint return for the year (except to claim a refund).

How to Use the Official WPTC Calculator

Pennsylvania’s Department of Revenue launched an online calculator to help you estimate your credit. Here’s how to use it:

Step 1: Gather Your Information

Before you start, you’ll need:

• Your expected 2025 income (or 2024 income as an estimate)
• Your filing status (single, married filing jointly, head of household)
• Number of qualifying dependents

Step 2: Access the Calculator

Visit the official Pennsylvania Department of Revenue website at www.pa.gov and search for “Working Pennsylvanians Tax Credit” or go directly to their WPTC page.

Step 3: Enter Your Information

The calculator will ask for:

• Filing status
• Annual income
• Number of dependents

Step 4: Review Your Estimate

The calculator will show you both your estimated federal EITC and your Pennsylvania state credit (which is 10% of the federal amount).

Important note: The calculator provides an estimate only. Your actual credit will be determined when you file your official tax return. Various factors like investment income, specific deductions, or changes in your situation could affect the final amount.

Real-World Examples: What Different Families Can Receive

Example 1: Single Parent with Three Children

• Income: $18,000
• Filing Status: Single
• Federal EITC: $8,046 (maximum)
• PA WPTC: $805 (maximum)
• Total Tax Credits: $8,851

Example 2: Married Couple with One Child

• Income: $40,000
• Filing Status: Married Filing Jointly
• Federal EITC: Approximately $3,200
• PA WPTC: Approximately $320
• Total Tax Credits: $3,520

Example 3: Single Worker with No Children

• Income: $15,000
• Filing Status: Single
• Age: 35
• Federal EITC: Approximately $600
• PA WPTC: Approximately $60
• Total Tax Credits: $660

Example 4: Married Couple with Two Children

• Income: $28,000
• Filing Status: Married Filing Jointly
• Federal EITC: Approximately $7,150
• PA WPTC: Approximately $715
• Total Tax Credits: $7,865

How to Claim Your Working Pennsylvanians Tax Credit

The claiming process is designed to be automatic and straightforward. Here’s exactly what you need to do:

Step 1: File Your Federal Tax Return

Start by filing your federal Form 1040 and claiming the federal Earned Income Tax Credit. This is essential—you must claim the federal credit to receive the state credit.

You can file your federal return through:

• Tax preparation software (TurboTax, H&R Block, etc.)
• Free File options through IRS.gov
• A tax professional
• IRS Free Tax Return Preparation Sites (VITA/TCE programs)

Step 2: File Your Pennsylvania PA-40 Tax Return

Next, file your state return. The easiest and fastest method is to file both returns online simultaneously through myPATH, Pennsylvania’s free online tax filing system.

When you file electronically:

• The system will automatically calculate your WPTC
• You’ll need to provide your federal EITC amount
• The Department of Revenue will verify your eligibility
• Your state credit will be applied to reduce your PA taxes or increase your refund

If you filed your federal return separately or through different software, you’ll need to:

• Enter your federal EITC amount manually when prompted
• Upload a copy of your federal Form 1040

Step 3: Wait for Your Refund

Once processed, if your WPTC exceeds your Pennsylvania tax liability, you’ll receive a refund for the difference.

Choose direct deposit for the fastest refund—typically arriving within a few weeks of filing. Paper checks take significantly longer, often 6-8 weeks or more.

Filing Timeline for 2025 Tax Year

• Tax filing season opens: January 2026
• Deadline to file: April 15, 2026 (unless extended)
• Estimated refund arrival (with direct deposit): Mid-February to early March 2026

Note: By law, the IRS must hold refunds that include EITC until mid-February to prevent fraud. This affects the timing of both your federal and state refunds.

Alternative Filing Options

For Paper Filers

If you prefer to file by mail:

1. Complete your federal Form 1040 and mail it to the IRS
2. Complete your PA-40 and include your federal EITC amount
3. Attach a copy of your federal return
4. Mail to the Pennsylvania Department of Revenue

Paper filing significantly delays processing—expect 8-12 weeks for refunds.

Need Help Filing?

Free tax preparation assistance is available through:

VITA (Volunteer Income Tax Assistance): Free tax help for people earning less than $67,000, persons with disabilities, and limited English speakers. Find locations at IRS.gov/VITA.

TCE (Tax Counseling for the Elderly): Free tax help for taxpayers age 60 and older. Find locations at IRS.gov/TCE.

Pennsylvania Department of Revenue District Offices: In-person assistance available. Call 717-787-8201 for locations and appointments.

United Way and Just Harvest: Local nonprofits operating free tax preparation sites across Pennsylvania, especially in Pittsburgh and surrounding areas.

Common Mistakes That Could Delay or Deny Your Credit

Avoid these frequent errors:

1. Not Filing the Federal EITC First

You must claim the federal credit before receiving the state credit. Many eligible workers leave money on the table by not claiming the federal EITC because they don’t realize they qualify or find it confusing.

2. Filing With the Wrong Status

Married couples must file jointly to claim EITC (with rare exceptions). If you’re married but file separately, you’ll be disqualified.

3. Incorrect or Missing Social Security Numbers

All family members claimed for the credit must have valid SSNs. ITINs (Individual Taxpayer Identification Numbers) do not qualify.

4. Exceeding Investment Income Limits

If you have more than $11,950 in investment income for 2025, you’re disqualified regardless of your earned income. Track dividends, interest, and capital gains carefully.

5. Not Including Required Documentation

If the IRS or state questions your claim, you’ll need proof of income (W-2s, 1099s) and documentation for qualifying children (birth certificates, school records, medical records).

6. Math Errors on Tax Forms

Use tax software or a tax professional to minimize calculation mistakes. A single math error can delay your entire refund for months.

7. Forgetting to File the PA-40

Some Pennsylvania workers file federal returns but skip the state return, thinking they don’t owe state taxes. You must file PA-40 to receive the WPTC, even if you don’t owe state taxes.

The Impact: Why This Credit Matters

The Working Pennsylvanians Tax Credit will deliver $193 million in relief to 940,000 workers across the state. For many families, this represents a week’s worth of groceries, a month of utilities, or emergency car repairs—expenses that can make or break a household budget.

Research consistently shows that earned income tax credits are among the most effective anti-poverty programs. They reward work, support families, and inject money directly into local economies.

In Philadelphia County alone, approximately 175,000 residents will benefit, receiving about $41.7 million in combined relief.

Across United Way’s five-county southwestern Pennsylvania region, an estimated 104,000 households claimed the federal EITC in 2022. The new state credit is projected to add $22.85 million in refunds for these households—an average of $220 per family.

For working Pennsylvanians living paycheck to paycheck—and in some cases, below the poverty line while still paying state income tax—this credit offers meaningful relief.

Special Considerations

What If Your Income Changes During the Year?

The EITC is based on your annual income. If you lose a job, take a pay cut, or have reduced hours, you might newly qualify. Conversely, a raise or new job could push you over the limit.

Check your eligibility early in the year and again before filing to ensure you’re making the most of this credit.

Can You Claim the Credit for Previous Years?

The Working Pennsylvanians Tax Credit begins with the 2025 tax year (filed in 2026). You cannot claim it for 2024 or earlier years since it didn’t exist.

However, if you didn’t claim the federal EITC in previous years but were eligible, you can file amended returns (Form 1040-X) for up to three prior years to claim those federal credits retroactively.

What If You’re Self-Employed?

Self-employment income counts as earned income for EITC purposes. You can claim both the federal and state credits if you meet all other requirements. Keep detailed records of your business income and expenses to substantiate your claims.

Military and Clergy Considerations

Special rules apply for military personnel and clergy members. Certain types of income (like combat pay) can be included or excluded strategically to maximize your credit. Consult with a tax professional familiar with these special situations.

Impact on Other Benefits

Tax credits like EITC and WPTC typically don’t count as income for other benefit programs like SNAP (food stamps), Medicaid, or housing assistance.

However, large refunds that remain in bank accounts could affect asset tests for some programs. Spend or save refunds strategically if you’re near asset limits for other benefits.

Looking Ahead: Future of the WPTC

The current credit equals 10% of the federal amount. This represents a compromise from the original proposal, which called for 30%. Advocates continue pushing for an increased percentage in future budgets, which would significantly expand the relief available to working families.

State officials emphasize that the credit will be automatically calculated for eligible filers, making it one of the most accessible tax benefits in Pennsylvania’s system.

Your Action Plan: Don’t Leave Money on the Table

Here’s your step-by-step checklist to ensure you receive your Working Pennsylvanians Tax Credit:

Before Tax Season:

• Use the official WPTC calculator to estimate your credit
• Gather all income documents (W-2s, 1099s, self-employment records)
• Collect documentation for qualifying children (birth certificates, SSNs, school records)
• Verify you meet all eligibility requirements
• Set up or confirm your bank account information for direct deposit

During Tax Season (January-April 2026):

• File your federal Form 1040 and claim the federal EITC
• File your PA-40 through myPATH or tax software
• Double-check that your federal EITC amount is entered correctly
• Choose direct deposit for fastest refund
• Keep copies of all filed returns and documentation

After Filing:

• Track your refund status through IRS.gov and PA’s system
• Save copies of your tax returns for at least three years
• Plan how to use your refund strategically (emergency fund, debt reduction, essential expenses)

Additional Resources

Pennsylvania Department of Revenue:

• Website: www.pa.gov/revenue
• Phone: 717-787-8201
• Online Customer Service Center: Available through the website

IRS Resources:

• EITC Information: IRS.gov/EITC
• Free File: IRS.gov/FreeFile
• VITA/TCE Locator: IRS.gov/VITA

Local Assistance:

• United Way of Southwestern Pennsylvania: Free tax preparation sites
• Just Harvest: Free Tax Prep Coalition
• Pennsylvania 211: Dial 211 for referrals to local tax preparation assistance

The Bottom Line

The Working Pennsylvanians Tax Credit is a game-changer for nearly one million households across the state. If you’re earning a modest income and working hard to support yourself or your family, you could receive up to $805 in additional tax relief—money that’s automatically calculated when you file your taxes.

Don’t leave this money on the table. Use the calculator to estimate your credit, gather your documents, and file electronically when tax season opens in January 2026. For most eligible workers, claiming this credit requires no extra steps beyond filing their regular tax returns.

This is money you’ve earned. Make sure you claim it.

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