The Combined Rate accounts for Federal, State, and Local tax rate on capital gains income, the 3.8 percent Surtax on capital gains and the marginal effect of Pease Limitations (which results in a tax rate increase of 1.18 percent).
Pennsylvania has a flat state income tax of 3.07% of federal taxable income. Additionally, many municipalities in Pennsylvania assess a tax on wages at an average rate of 2.94%.
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