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Dpol
New Member

Working in PA living in DE and my job says they can’t withhold DE taxes

My current employer can’t withhold my DE taxes because they don’t have jurisdiction or Tax ID for the state. What should I do? I want to avoid any penalties and I want to pay what is owed so I don’t have a large amount owed come tax season.

Edit:

PA and Federal are still coming out of check.

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3 Replies

Working in PA living in DE and my job says they can’t withhold DE taxes

You will need to pay estimated taxes to the state of Delaware.

Go to this Delaware website for information - https://www.efile.com/delaware-state-tax-payments/

rjs
Level 15
Level 15

Working in PA living in DE and my job says they can’t withhold DE taxes

You will pay little or no Delaware tax, so you don't need Delaware withholding, and probably do not need to make estimated tax payments to Delaware. You have to pay Pennsylvania tax on the income you earn from working in Pennsylvania. Since you live in Delaware, all of your income is subject Delaware tax, no matter where the income is from. But you will get a credit on your Delaware tax return for part or all of the tax that you pay to Pennsylvania. The credit will eliminate most or all of your Delaware tax.


If you have other income besides your job in Pennsylvania, you will probably have to pay Delaware tax on the other income. Depending on how much it is, it might or might not be necessary to make estimated tax payments to Delaware.


You have to file two state tax returns, a Pennsylvania nonresident tax return and a Delaware resident tax return. Prepare your Pennsylvania nonresident tax return first, then your Delaware resident tax return, to make sure that the credit for tax paid to Pennsylvania is calculated correctly.

 

TomD8
Level 15

Working in PA living in DE and my job says they can’t withhold DE taxes

Here is Delaware's rule:

 

Every resident and non-resident individual shall make a declaration of estimated tax for the taxable year if the tax due in excess of withholding can reasonably be expected to exceed $800.00.

https://revenuefiles.delaware.gov/2022/PIT-EST_2022-01_Instructions.pdf

 

PA's income tax rate is a flat 3.07%.  DE's rate is graduated and can run as high as 6.60%.  So there is a good chance that your "other state credit" for PA will not cover your DE tax bill.

 

I suggest you follow @DoninGA 's advice.

**Answers are correct to the best of my ability but do not constitute tax or legal advice.
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