{"place":"Philadelphia, PA","kind":"city","asOf":"2026-10-07","url":"https://gigaverse.ai/local/philadelphia-pa","state":{"code":"PA","name":"Pennsylvania","slug":"pennsylvania","incomeTax":{"type":"flat","flatRate2026":3.07,"lowestRate2026":null,"topRate2026":null,"topRateStartsSingle":null,"notes":"Flat 3.07% applies to eight separate classes of income, including net business profits. A loss in one class cannot offset income in another class.","source":"https://www.pa.gov/agencies/revenue/resources/tax-types-and-information/personal-income-tax"},"estimatedTax":{"form":"PA-40 ES (I) with worksheet REV-414 (I)","rule":"For 2026, you must pay estimated tax if you expect to owe at least $430 ($14,000 of income not subject to withholding) after withholding and credits; the income threshold rises to $17,000 in 2027 and $20,000 in 2028.","schedule":"Same dates as federal (April 15, 2026; June 15, 2026; September 15, 2026; January 15, 2027)","source":"https://www.pa.gov/content/dam/copapwp-pagov/en/revenue/documents/formsandpublications/formsforindividuals/pit/documents/2026/2026_rev-413i.pdf"},"minimumWage2026":{"standard":7.25,"tippedCash":2.83,"tipCreditAllowed":true,"notes":"A tipped employee is one who regularly gets more than $135 a month in tips. Cash wage plus tips must reach at least $7.25 an hour. No increase was in effect as of July 1, 2026, according to the USDOL state table.","source":"https://www.pa.gov/agencies/dli/resources/compliance-laws-and-regulations/labor-management-relations/labor-law/overtime-and-tipped-worker-rules-in-pa"},"soleProprietorTaxes":[],"contractorLaws":[{"name":"Unemployment compensation two-part independent contractor test","summary":"A worker is presumed to be an employee unless they are free from control or direction over the work, both under the contract and in fact, and are customarily engaged in an independently established trade, occupation, profession, or business.","source":"https://www.pa.gov/agencies/dli/resources/compliance-laws-and-regulations/covered-employment/employee-or-independent-contractor"},{"name":"Construction Workplace Misclassification Act (Act 72 of 2010)","summary":"Construction workers are presumed to be employees. To be a contractor they need a written contract, freedom from control, and an independent business. That includes owning essential tools, chance of profit or loss, a separate business location, work for others, and at least $50,000 of liability insurance.","source":"https://www.pa.gov/agencies/dli/resources/compliance-laws-and-regulations/covered-employment/employee-or-independent-contractor"}],"notes":"Under Act 32, most municipalities and school districts levy a local earned income tax on sole proprietors' net profits, paid through quarterly estimated payments to the local tax collector (https://dced.pa.gov/local-government/local-income-tax-information/act32-faq)."},"stateRetirementProgram":{"state":"Pennsylvania","code":"PA","programName":null,"status":"none","employerMandate":null,"mandateMin":null,"keyDates":null,"covers1099":null,"selfEnroll":"n/a","sourceUrl":"https://www.palegis.us/legislation/bills/2025/sb1069","note":"No enacted program. The proposed Keystone Saves Program (HB 577 passed the House May 16, 2025; SB 1069 pending) would cover employers with 5+ employees in business 15+ months, with no penalty in the current bill text. It is not law and Pennsylvania is not among Georgetown CRI’s 22 program states.","lastVerified":"2026-09-09"},"city":{"slug":"philadelphia-pa","name":"Philadelphia","stateCode":"PA","county":"Philadelphia County","population":1574281,"populationYear":2025,"localIncomeTax":{"applies":true,"name":"Wage Tax / Earnings Tax (wages) and Net Profits Tax (self-employment)","residentRate":3.735,"nonresidentRate":3.425,"selfEmployed":"Self-employed people and sole proprietors pay the Net Profits Tax: residents on net profits from any business, even if conducted outside Philadelphia, and nonresidents on net profits from business conducted in Philadelphia. A return is required even with a loss. Estimated payments are due April 15 and June 15, each equal to 25% of the prior year's Net Profits Tax.","effective":"Wage and Earnings Tax rates effective July 1, 2026; Net Profits Tax rates apply to tax year 2026 (filed in 2027).","source":"https://www.phila.gov/2026-06-11-what-you-need-to-know-about-changes-to-phillys-use-and-occupancy-tax"},"localBusinessTaxes":[{"name":"Philadelphia Business Income & Receipts Tax (BIRT)","summary":"Every individual or entity engaged in business for profit in Philadelphia, sole proprietors included, must file BIRT, which taxes both gross receipts and net income. Rates for tax year 2026 are 1.395 mills on gross receipts and 5.65% of taxable net income (1.410 mills and 5.71% for 2025). As of tax year 2025 the old $100,000 gross receipts exemption no longer applies; businesses with no BIRT filing requirement in 2022, 2023, and 2024 do not have to pay BIRT estimated tax in 2026, and part of the BIRT net income portion may be credited against the Net Profits Tax.","source":"https://www.phila.gov/services/payments-assistance-taxes/taxes/business-taxes/business-taxes-by-type/business-income-receipts-tax-birt"}],"businessLicense":{"required":true,"summary":"Any person or entity doing business in Philadelphia needs a Commercial Activity License, which is free, issued automatically online through eCLIPSE, and does not need renewal; applicants must be current on city taxes.","source":"https://www.phila.gov/services/permits-violations-licenses/get-a-license/business-licenses/activity/get-a-commercial-activity-license/"},"gigLaws":[{"name":"Philadelphia Domestic Workers Bill of Rights (Philadelphia Code Chapter 9-4500)","summary":"People who hire domestic workers such as house cleaners, nannies, and caregivers in a private home must give them a written contract and a notice of their rights, unless the work is casual (under 5 hours a month). The law covers independent contractors as well as employees, and a platform that controls a worker's pay can also count as a hiring entity. Pet sitting, dog walking, house sitting, and home repair work are excluded; complaints go to the Office of Worker Protections.","source":"https://www.phila.gov/departments/department-of-records/regulations/domestic-worker-regulations-with-contract-templates.pdf"}],"notes":"Net Profits Tax details: https://www.phila.gov/services/payments-assistance-taxes/business-taxes/net-profits-tax/. Residents also owe the School Income Tax (3.735% for 2026) on certain unearned income such as dividends and royalties. BIRT tax year 2026 rates come from the City's June 11, 2026 notice (localIncomeTax source). Employers with 10 or more employees must pay tipped workers (bartenders, servers) $17.88 per hour of paid sick time from July 1, 2026 to June 30, 2027 (https://www.phila.gov/2026-08-04-new-paid-sick-leave-rate-for-tipped-workers-in-philly).","populationSource":"https://www2.census.gov/programs-surveys/popest/datasets/2020-2025/cities/totals/sub-est2025.csv"},"guides":[{"audience":"consultants","url":"https://gigaverse.ai/local/philadelphia-pa/consultants"},{"audience":"freelancers","url":"https://gigaverse.ai/local/philadelphia-pa/freelancers"},{"audience":"content-creators","url":"https://gigaverse.ai/local/philadelphia-pa/content-creators"},{"audience":"entrepreneurs","url":"https://gigaverse.ai/local/philadelphia-pa/entrepreneurs"},{"audience":"gig-workers","url":"https://gigaverse.ai/local/philadelphia-pa/gig-workers"},{"audience":"tipped-workers","url":"https://gigaverse.ai/local/philadelphia-pa/tipped-workers"},{"audience":"tradespeople","url":"https://gigaverse.ai/local/philadelphia-pa/tradespeople"}],"disclaimer":"Educational information for 2026, not tax, legal or investment advice. Sources are cited per fact."}