(Revised 7-2009) This Tax Book Has Been Prepared for Accountants, Tax
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(Revised 7-2009) This tax book has been prepared for accountants, tax preparers, attorneys and individuals to provide a summary of all taxes levied by the City of Pittsburgh and the School District of Pittsburgh. These taxes are collected by the City-School Treasurer who is also responsible for the discovery and collection of delinquent taxes. There are two categories into which one could place Pittsburgh’s taxes. One is the assessed, the other is self- assessed. The table of contents on page 4 shows each tax by category. For the assessed taxes, the City will compute the tax due based on information provided by Allegheny County. For self-assessed taxes, the City provides forms to be completed by the taxpayer or tax preparer. Forms will not be mailed unless the taxpayer has been properly registered. Payment in full is required at the time the tax return is filed. Modern sources of data retrieval and exchange make the detection of tax delinquency and underpayment easier. In order to avoid penalty and interest charges, taxpayers, their tax preparers and consultants must know how and when to properly file City and School District tax returns. For additional information and assistance, refer to the listed phone number for each tax type or visit our website at www.city.pittsburgh.pa.us/finance. Tax forms, tax rates, Pittsburgh Code and zip code listings are all available on our website. GENERAL NOTES FOR SELF-ASSESSED TAXES It is the taxpayer’s responsibility to pay taxes when due. Failure to receive a form is never an excuse for a late payment. City and School District of Pittsburgh taxes that are not paid when due require an additional payment of penalty and interest. Federal tax extensions are not recognized by the City and School District. Extensions are not granted. For all payments of self-assessed taxes, except direct payment of Earned Income Tax and Local Services Tax by the individual taxpayer, it is required that the business file a registration form (NBR-1) with the Finance Department, Business Registration section 412-255-2528. Registration Form’s can be downloaded at www.city.pittsburgh.pa.us/finance At the time one begins doing business in Pittsburgh, the business must be registered with the City Treasurer. Several taxes require the filing of a tax return by the taxpayer even when there is no tax due. This is true for the earned income tax, payroll expense, business privilege tax, and institution and service privilege tax. Taxes that are not paid when due will accrue penalty and interest. One day’s delinquency into a succeeding month is assessed as an entire month. When the Treasurer receives only a partial payment and penalty and interest are due, the payment is applied to the tax first. A bill will be sent for the balance of tax plus penalty and interest. The accounting records should distinguish between sales of merchandise and services rendered. Services are subject to the business privilege tax. In regard to the Business Privilege and Institution & Service Privilege Taxes, the deadline for the initial return is 40 days after beginning business. The amount due is based on the first month’s business computed or accounted for on an accrual basis even for a cash basis taxpayer. In the second year (the first full year of business), the tax is computed by multiplying that same first month’s gross receipts by twelve months times the current tax rate. Subsequent year’s taxes are computed by using the previous calendar year’s gross receipts to determine the tax for the current year payable, April 15th. Tax rates are subject to change. Please check our web site at www.city.pittsburgh.pa.us/finance REAL ESTATE TAX Pittsburgh Code Reference: Chapter 263 First Levied: 1816 WHO IS TAXED: All owners of real estate located within the City and School District. The market value of the property is determined by the Allegheny County Office of Property Assessment. The taxes are calculated by applying the millage rate to the assessed value. DISCOUNTS: Taxpayers may take a 2% discount on either of the following if tax is paid by February 10th: The total annual tax due or, The first installment of tax due. TAX PAYMENTS DUE DATES Last day of February for 1st installment or the annual amount at gross. April 30th for 2nd installment July 31st for 3rd installment If no payment is made by the last day of February or if less than the entire first installment amount is paid by the last day of February, the entire year’s taxes become due and payable in full and incur interest charges from March 1st. Tax bills are mailed in January. Further installment bills are mailed in April and July. If you have any questions please call 412-255-2525 or visit www.city.pittsburgh.pa.us/finance HOMESTEAD EXEMPTION - OWNER OCCUPIED PROPERTIES The City exempts the first $10,000 of assessed value for every residential property that is owner occupied. The School District began participation in tax year 2009. The amount exempted will vary from year to year. The 2009 exemption was $20,363. Allegheny County exempts the first $15,000 of assessed value. ACT 77 – PROPERTY TAX RELIEF PROGRAM The City of Pittsburgh offers a senior tax relief program for eligible owner occupants. The School District does not receive funding from the Regional Asset District tax and, therefore, does not participate in the program. Current qualifications are: (a) at least 50 years of age; (b) must have owned and occupied a home in Allegheny County for ten consecutive years preceding application; (c) total household income cannot exceed $30,000 (using 50% of social security benefits); (d) the owner must be a natural person. All eligible homeowners are required to apply with the City of Pittsburgh each year. Renewal applications are mailed in August for the next year’s taxes. NOTE: Allegheny County has a similar program. CATASTROPHIC LOSS ADJUSTMENT In the event a property has been lost due to a fire or natural disaster, the owner may apply for a tax adjustment for the next year’s taxes through the Allegheny County Office of Property Assessment. REAL ESTATE TAX ABATEMENT PARTICIPATING TAXING BODY AND PERIOD PROGRAM TYPE REDUCTION ABATEMENT/CREDIT LIMIT * ABATED ACT 42 RESIDENTIAL ASSESSMENT A $86,750 YR 3 Years PGH CODE REDUCTION For new construction CHAPTER 265 A $36,900 YR For renovations ACT 42 ENHANCED ASSESSMENT C & S $250,000 YR 10 Years RESIDENTIAL REDUCTION ORD 9 PGH CODE For new construction or renovations CHAPTER 265 COMMERCIAL TAX CREDIT 5 Years LERTA PGH CODE C $50,000 YR CHAPTER 267 RESIDENTIAL TAX CREDIT C $150,000 YR 10 Years LERTA S $250,000 YR ORD 10 ** PGH CODE CHAPTER 267 CN $100,000 YR RESIDENTIAL ENHANCED TAX CREDIT 10 Years LERTA C $2,700 YR ORD 10 PGH CODE S $3,480 YR CHAPTER 267 VISITABILITY TAX CREDIT *** C & CN 5 Years RESIDENTIAL $2,500 max credit for each taxing body over 5 years SENIOR CITIZEN AND DISABLED CITIZEN REBATES The State of Pennsylvania has a program to provide Real Estate tax or rent rebates for senior citizens and disabled people who receive less than $35,000 per year income from all sources. The maximum rebate is $650 a year and decreases as total income approaches $35,000. The form used for rebate request is called “Property Tax or Rent Rebate” Form PA-1000 and can be obtained in the State Office Building or from the Real Estate Department 1st floor of the City County Building. For additional information you can contact the State Rebate Office at 412-565-7540. A tax receipt, which is needed to apply, is mailed annually or can be obtained at the counter in the Real Estate Division, 1st Floor of the City-County Building. EXEMPTION FOR VISITABILITY DESIGN This program offers tax credits as incentives to new construction or renovation projects that provide access for disabled individuals into residential housing. The total amount of the tax credit shall be the lesser of $2,500, or the total amount of all increases in property taxes leveled as a result of the construction/renovation that is eligible for the Residential Vistitability Design Tax Credit. Both the City and the county offer the $2,500 tax credit. Contact the Development and Administration Review Division of the Department of City Planning for additional information and an application form. REAL ESTATE TAX ABATEMENT PROGRAMS There are residential and commercial exemption or abatement programs. To meet eligibility for a particular program, the project must meet ALL of the criteria in each category. NOTE: mixed-use buildings may be eligible for two abatement programs simultaneously. The building assessment will be pro-rated based on the use. Applications are available at the Building Permit Office and should be obtained when the building permit is issued. Applications are also available at www.city.pittsburgh.pa.us/finance. Applications must be filed within 180 days of the issuance of the building permit. PROGRAM COMPARISONS FUTURE USE ASSESSMENT CURRENT AND ELIGIBLE INCREMENT USE OF OWNERSHIP AREA ABATED PROPERTY TYPE Residential 100% increase For sale or Residential tax due to rental CITY WIDE or improvements Vacant Land Residential 100% increase For sale or Residential tax due to rental 28 DEFINED AREAS or improvements Vacant Land Commercial or Industrial for sale 100% increase or rental Commercial tax due to CITY WIDE Industrial or improvements Vacant Land 100% YRS 1 & 2 Residential rental (apartments) or 90% YRS 3 & 4 hotels Commercial 80% YRS 5 & 6, & 4 DEFINED AREAS or Industrial SO ON ** Residential separately assessed 100% increase units Commercial tax due to 4 DEFINED AREAS or improvements Industrial Residential Residential 100% increase Single family Duplex Triplex Vacant Land tax due to CITY WIDE Adapted reuse Commercial improvements Industrial * C – City S – School CN – County A – City, School and County *** Visitability tax credit can run concurrently with other residential programs.