Pennsylvania Form PA-40 Schedule G-L – Credit for Tax Paid to Other States (2026)

Last reviewed: 2025-11-09

Use the Pennsylvania Tax Form Calculator Pennsylvania Form PA-40 Schedule G-L – Credit for Tax Paid to Other States as a stand alone tax form calculator to quickly calculate specific amounts for your 2026 Pennsylvania state tax return. Alternatively, you can use one of our Combined Federal and State Tax Estimators to quickly calculate your salary, tax, and take-home pay.

Form PA-40 Schedule G-L allows Pennsylvania residents to claim a credit for taxes paid to other states on income that is also taxable in Pennsylvania. This prevents double taxation when the same earnings — such as wages, business profits, or rental income — are taxed both in Pennsylvania and another U.S. jurisdiction. The credit applies only to taxes paid on income that is also reportable under Pennsylvania’s personal income tax system.

To use Schedule G-L, you must prepare a separate schedule for each state where you paid tax. The credit you can claim is the lesser of (1) the Pennsylvania tax on that income or (2) the actual tax paid to the other state. You must include a copy of the out-of-state return or other proof of payment when filing your Pennsylvania return.

This form is particularly important for residents who work across state lines or operate businesses in multiple states. Schedule G-L ensures your total tax liability reflects only Pennsylvania’s fair share of the income tax owed.

How to Complete Schedule G-L

Follow these steps to accurately compute your resident credit:

1. Enter State Name: Identify the state where income tax was paid on Line 1. Complete a separate Schedule G-L for each state.
2. Classify Income by Type: Report the specific type of income (e.g., wages, business income, or rental income) on Lines 2a through 2j, following the Pennsylvania income classes shown on Form PA-40.
3. Calculate Shared Income: Add Column C across Lines 2c–2j to determine the portion of income taxed by both Pennsylvania and the other state (Line 3).
4. Compute Taxes: Record the tax due or assessed in the other state (Line 4a), tax actually paid (Line 4b), and any adjustments (Line 4d). The adjusted amount (Line 4e) represents your verified tax paid to that state.
5. Calculate Pennsylvania Tax on Same Income: Multiply the Line 3 amount by Pennsylvania’s flat income tax rate of 0% (Line 5).
6. Determine Allowable Credit: The resident credit (Line 6) equals the smaller of Line 4e (other state tax) or Line 5 (PA tax). Report this on PA-40 Line 22.

Keep copies of all state returns, W-2s, and tax payment confirmations as supporting documentation. Missing documentation may delay or deny your credit claim.

Examples and Practical Scenarios

Example 1 – Working in a Neighboring State: Jamie, a Pennsylvania resident, works in Delaware and earns $50,000. Delaware withholds $2,000 in income tax. Pennsylvania tax on the same income is $1,535 (3.07%). Since the PA tax is less, Jamie’s credit is limited to $1,535. This fully offsets Pennsylvania’s tax liability on that income, avoiding double taxation.

Example 2 – Business Income from Maryland: Jordan operates a consulting business in both Pennsylvania and Maryland. Maryland taxes $20,000 of Jordan’s profit at $1,000. Pennsylvania taxes the same income at $614 (3.07%). The allowable credit is $614, the lesser of the two tax amounts.

Example 3 – Multiple State Returns: If you earned income in both Ohio and West Virginia, you must complete a separate Schedule G-L for each. Add the credits from each state and enter the total on PA-40 Line 22.

Example 4 – Joint Filers: Married taxpayers must complete separate Schedules G-L for each spouse if both earned income in other states. For instance, if one spouse works in New York and the other in Maryland, file two Schedules G-L, one for each state.

Example 5 – Adjusted Tax Limitation: If income subject to tax in another state exceeds that reported in Pennsylvania for the same class, you must proportionally reduce the other state’s tax before calculating the credit (Line 4d adjustment). This ensures the credit does not exceed Pennsylvania’s tax on that income class.

Additional Information and Related Forms

• Form PA-40 – Individual Income Tax Return
• Schedule NR – Nonresident and Part-Year Resident
• Official Schedule G-L (PA Department of Revenue)
• Pennsylvania Department of Revenue – PIT Forms

Schedule G-L helps Pennsylvania residents accurately report income taxed in other jurisdictions, ensuring fair tax treatment and compliance with multistate tax laws. By comparing Pennsylvania’s flat tax rate of 0% with the rate paid elsewhere, taxpayers can confirm that their total tax burden remains balanced and lawful.

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Important Notes

All calculations are estimates for guidance only. Always review your return and consider professional advice when submitting official filings.