Please ensure Javascript is enabled for purposes of website accessibility Sappey’s Working Pennsylvanians Tax Credit proposal becomes law

Sappey’s Working Pennsylvanians Tax Credit proposal becomes law

Rep. Christina Sappey    November 13, 2025 | 3:28 PM

HARRISBURG, Nov. 13 – When legislation enacting the 2025-26 state budget was signed by the governor Wednesday, it included the creation of the Working Pennsylvanians Tax Credit, which was authored by Rep. Christina Sappey.

Nearly 1 million working Pennsylvanians will benefit from this state-level tax credit on their personal income taxes.

“All across Pennsylvania, working families are doing everything they can to make ends meet,” said Sappey, D-Chester. “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, benefit our economy, and eligibility for the credit is capped. The goal is to keep these critical working families moving ahead and earning enough not to qualify. This program is highly successful in other states and helps grow the middle class.”

Sappey said that any Pennsylvania household that qualifies for the federal Earned Income Tax Credit will qualify for the Working Pennsylvanians Tax Credit, which will be 10% of the federal EITC amount that household receives. That amount could range from $400 to more than $1,000 depending on family size and income.

“This means more people can keep working, more money will be invested in local businesses and there will be less demand on social safety net programs,” Sappey said. “It’s a smart investment. For every dollar returned to families through this state tax credit, Pennsylvania will receive $4 back in economic growth and save $3 on social spending.”

Sappey said the EITC is widely regarded as the most successful anti-poverty program of the last 50 years.

The federal Earned Income Tax Credit provides a tax break to low-to-moderate-income workers and families by offering a credit, based on their income and family size, to reduce the taxes they owe. According to the IRS, for the 2023 tax year (as of December 2024), approximately 802,000 Pennsylvania households shared more than $2 billion in EITC. The average federal EITC in Pennsylvania was $2,600.

Pennsylvania now joins 31 other states that have their own state tax credit to enhance the federal EITC’s impact.

The proposal was included in the Fiscal Code (Act 45 of 2025), which the governor signed Wednesday, along with the budget and other related code bills.