940K PA Residents Qualify For New Tax Credit: What To Know

HARRISBURG, PA — Pennsylvania leaders have announced a new tax credit that will provide some $193 million in tax relief to residents across the state, as residents continue to battle rising costs and ongoing income inequality.

The Working Pennsylvanians Tax Credit, part of the 2025-26 budget that was passed last week, will impact an estimated 940,000 low to moderate income Pennsylvania residents.

Karen Showalter, the senior director of economic security nonprofit MomsRising, says the credit will help out many residents who are living on the edge.

“So many of (our members) tell us that even though they’re working hard and caring for their families, they still can’t get ahead," she said. "More and more are juggling paid work while also caring for young children or aging parents, often both, and struggling to keep everything afloat. Programs like this provide meaningful relief."

Any resident who qualifies for the federal Earned Income Tax Credit will now also qualify for the new state plan, with the potential to get back as much as 10 percent of the federal credit.

The exact amount that residents can expect depends on a variety of factors, including income, the number of people in the household, and the number of children.

For a single working parent with three children who earns $23,300 or less, they can earn the maximum state credit of $805.

Meanwhile, a married couple with two children that earns $30,470 can earn $715.

Even couples with three children that earn up to $60,000 can get back $183.

Learn more about qualifying for the EITC, which qualifies residents to the Pennsylvania credit, at the IRS website here.

“All across Pennsylvania, working families are doing everything they can to make ends meet,” said State Rep. Christina Sappey said in a statement. “Many are dual-income households earning modest wages, juggling rent or mortgage payments, child care, health care and everyday essentials. When those basic costs outpace paychecks, families struggle, and our entire economy feels the impact. This new tax credit will support working families and benefit our economy.”

The notion of states providing an extra tax credit to lower income residents is not new. In fact, Pennsylvania becomes the 32nd state in the country to implement a similar program.