In this case, the employee still has to report the entire amount of jury duty pay as taxable income, but may claim the amount of jury duty pay given to the employer as an adjustment to income.
Employees who turn jury duty pay over to their employers can claim the deduction on Form 1040 as an adjustment to income. The amount is shown as a write-in adjustment in the total on line 36. See Form 1040 Instructions for more information.
The same would be true for PA, the adjustment would come from the Fed adjustment. Make sure it carries over.
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