Instructions And Definitions For Filing Final Return For Local Earned Income Tax & Net Profits Tax

INSTRUCTIONS AND DEFINITIONS FOR FILING FINAL RETURN

FOR LOCAL EARNED INCOME TAX & NET PROFITS TAX

FOR FILING ASSISTANCE PLEASE CALL: 610-372-8439 TOLL FREE: 1-855-372-8439

OR VISIT OUR

WEBSITE:

FILING INSTRUCTIONS:

Line 1 -

Earned Income from W-2(s): All earned income (gross eamings) is taxable and is defined as income received for personal

services rendered, irrespective of where such services are penormed. Please refer to Pennsylvania Department of Revenue

instructions for line 1 of Form PA-40. An exception is Clergy Housing Allowance which is not taxable for local earned income tax

purposes.

Line 2-

Allowable Unreimbursed Employee Business Expenses: Expenses as defined and permitted by the Commonwealth of

Pennsylvania. All supporting documents, as required by PA UE-1 or UE-2 (example: Federal Form 2106 for mileage), must be

attached.

Note: Should the taxpayer omit the required expense deduction forms, or if the expense deduction forms are not fully

completed, the expense deduction shall be systematically disallowed and denied without notification to the

taxpayer. A taxpayer's UE Expenses cannot exceed his/her wages from the employer listed on UE.

Line 3 - Other Earned Income: Tips Received; Directots Fees; Taxes Assumed by Employer; Stock Options (when not declared on the

W-2 as wages); Incentive Payments; Fellowship (When Compensation for Services); Compensation in the Form of Propert (taxed

at its Fair Market Value); Executots Fees; Jury Duty Pay; Stipends; and various other employer-paid fringe benefits (excluding

premiums on excess Group Life Insurance). Please enclose copies of a1l1099-MISC forms not declared in lines 5 or 6.

Line 5 - Net Profits: Non-passive income only. Each business, profession, and/or partnership must be reportHd separately. Guaranteed

payments to partners are taxable as earned income.

Line 6 - Net Losses from Non-passive income only. Do not include losses from S-Corps; rents; and/or other investments. Losses may be

used to offset net profits. Wages may not be offset by losses. One person's loss cannot be offset by his/her spouse's net profit.

(Refer to PA Act 32 of 2008). Guaranteed payments to partners are taxable as eamed income.

Line 9 - Line 8 multiplied by the applicable tax rates as follows:

. %% for Union Township (Daniel Boone Area School District portion only)i

. 3.6% for Reading City and Reading School District

. 1% for all other Municipalities and School Districts

Do not include tax withheld by the City of Philadelphia or the Local Services Tax. Credit will not be given for the non-resident tax

levied by distressed municipalities in excess of the rate levied by your resident municipality.

Line 10- City of Reading Distressed Commuter Tax rate 0.3% (Levied upon non-residents working in or earning net profits from a

business operating within the corporate limits of the City of Reading).

Line 11- Total tax due.

Line 16- Incomplete or inaccurate requests for refunds shall be adjusted without notification to the taxpayer.

Line 19- Penalty is levied at the rate of Y:% per month on any tax unpaid after April 17, 2012.

Line 20 Interest at the rate of Y:% per month is levied on any tax unpaid after April 17, 2012. Failure to comply by the due date may result

in additional costs and/or collection fees. A copy of the Cost Collection Fees Schedule is available upon request.

Line 21- Total Due: Add lines 16, 17, and 18. A check or money order, payable to Berks E.I.T. Bureau must be enclosed with this return.

(Do not pay any amount less than $1.00.)

CREDIT CARD PAYMENTS: You may elect to pay your balance due by credit card (VISA, MasterCard, American Express or

Discover) through Offcial Payments Corp. It is a simple, safe, and convenient payment option. There is a fee charged by Official

Payments Corp. for utilzing this payment. Credit Card payments may be made via a link through our website or

by phone 1-800-272-9829. The Jurisdiction Code is 4845. At several points in the transaction process, you wil be informed of the fee

charged by Official Payments Corp. When you use this service, two line items wil appear on your credit card bilL. One is for the

amount paid to the Berks EIT Bureau for tax due and the other is for the fee charged by Offcial Payments Corp. If you have any

questions about this method of payment, please contact our office. YOU ARE STILL REQUIRED TO FILE YOUR LOCAL TAX

RETURN WITH APPROPRIATE SUPPORTING DOCUMENTATION. Please check the payment by credit card box on the tax

form and return envelope.

You are entitled to receive a written explanation of your rights with regard to the audit, enforcement, refund, and collection of loc31 taxes collected by the Berks

E.I.T. Bureau by callng the Bureau at 610-372-8439, or toll free at 1-855-372-8439, during the hours of 8:00 A.M. to 5:00 P.M., Monday through Friday.

Instructions And Definitions For Filing Final Return For Local Earned Income Tax & Net Profits Tax - 2011 Page 2

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