Yes, it is taxable. A deemed distribution from a RIC (Regulated Investment Company) is generally treated the same as a dividend for Pennsylvania tax purposes.
Pennsylvania does not follow federal rules that sometimes recharacterize certain RIC distributions differently. Instead, PA uses its own classification system, and under that system:
- Dividends are taxable as PA “gross income class” dividend income.
- PA does not allow deductions or adjustments against dividend income.
- If the deemed distribution appears on a Form 1099‑DIV, it is almost always treated as a taxable dividend for PA PIT.
PA Dividends
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