Students interested in this college are also interested in: Colorado State University, University of Washington, University of California, Berkeley, University of Oregon, University of California, Los Angeles, University of California, Santa Barbara. Overview.
These plans areexcluded from tax on your federal return, but not onyour state income tax return. Once you retire and beginto receive pension benefits, you will pay federal tax onyour retirement payments, but you will not pay PA taxon those benefits.
Pennsylvania law requires employers to withhold Pennsylvania personal income tax from employeesâ compensation in two common cases: 1  When resident employees perform services within or outside Pennsylvania; and. 2  When nonresident employees perform services within Pennsylvania.