State credits
Working Pennsylvanians Tax Credit
Pennsylvania created a state earned income credit in its 2025 budget, the first for tax year 2025. It is claimed on the PA-40.
Pennsylvania and federal earned income credit calculator
Credits for tax year 2025, head of household, 2 qualifying children
$10,992
| Federal EITC | $6,799 |
| Working Pennsylvanians Tax Credit | $680 |
| Child tax credit, lowers your tax | $138 |
| Additional child tax credit, refundable | $3,375 |
Phase-out: each extra dollar lowers the federal credit; federal maximum $7,152, nothing from $57,310.
$887 of child tax credit is lost: it exceeds your federal tax and the refundable cap.
Rules of the Pennsylvania creditThe Working Pennsylvanians Tax Credit is Pennsylvania's first earned income credit, enacted in the 2025 budget for tax years beginning in 2025. It equals 10% of the federal earned income credit and is refundable, so a household with no Pennsylvania tax receives it in full. A family with two children at the 2025 federal maximum of $7,152 receives $715; one child, $433; three or more, $805; a worker without a child, up to $65. It is claimed on Form PA-40 and follows the federal eligibility rules. Pennsylvania has a flat 3.07% income tax and a separate program, Tax Forgiveness, which can cancel the tax of low-income households; the new credit is paid on top. The Department of Revenue page explains how to claim it in 2026.
IRS and state rules read by Radif Partners · Editorial policy · Method and sources
The Pennsylvania credit in one table
| Name | Working Pennsylvanians Tax Credit |
| Form | Form PA-40 |
| Administered by | Pennsylvania Department of Revenue |
| Tax year 2025 | 10% of the federal credit |
| Tax year 2026 | 10% of the federal credit |
| Refundable | refundable |
| ITIN filers | not accepted (same SSN rule as federal) |
| Worker without a qualifying child | federal age rule, 25 to 64 |
First filing season
Because the credit is new, many eligible households do not yet know they need to claim it on the state return. The Department of Revenue page gives the steps. The amount is taken from the federal return.
Pennsylvania credit by income, tax year 2025
| Earned income | No child | 1 child | 2 children | 3 or more |
|---|---|---|---|---|
| $5,000 | $38 | $171 | $201 | $226 |
| $10,000 | $65 | $341 | $401 | $451 |
| $15,000 | $31 | $433 | $601 | $676 |
| $20,000 | $0 | $433 | $715 | $805 |
| $25,000 | $0 | $406 | $680 | $769 |
| $30,000 | $0 | $326 | $575 | $664 |
| $40,000 | $0 | $166 | $364 | $453 |
| $50,000 | $0 | $7 | $153 | $243 |
| $60,000 | $0 | $0 | $0 | $32 |