These States Don’t Tax Your Unemployment Benefits!

Photo by Alexander Lukatskiy from Shutterstock

Pennsylvania

Living in Pennsylvania, and you’re still unemployed? As scary as being unemployed might seem to some of us, living in a state where no taxes are imposed on unemployment compensation is ideal. That’s also the case of Pennsylvania, as the state doesn’t tax unemployment benefits.

Yet, it does tax other types of income. The state imposes a flat rate of 3.07 percent, but municipalities and school districts also have their own taxes on income and wages. As for sales taxes, Pennsylvania has a 6 percent levy, but it can rise to 8 percent due to the local sales tax.

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