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INSTRUCTIONS FOR FILING FORM 531, JUNIATA VALLEY SCHOOL DISTRICT 2014 LOCAL EARNED INCOME TAX

(EIT) RETURN

General Instructions

WHO MUST FILE - Any resident of a "MEMBER MUNICIPALITY AND/OR SCHOOL DISTRICT" whether for all or part of the tax year, who

has taxable net profits and/or earnings even if no tax is due. Failure to file a return may subject you to a $500 fine as well as be

responsible for paying additional costs of collection.

ROUNDING OFF TO WHOLE DOLLARS – Round off cents to the nearest whole dollar. When rounding, drop amounts under 50 cents and

increase amounts from 50 to 99 cents to the next dollar. For example, $1.39 becomes $1.00 and $2.50 becomes $3.00. When you add

two or more amounts to calculate the amount to enter on a line, include cents when adding the amounts and only round off the total.

IF YOU HAD NO TAXABLE EARNINGS enter zero (0) in Line 1 and list the reason (e.g., retired, disability, housewife, active military duty,

etc.), sign the form and return it to us. This will eliminate needless correspondence.

IF YOU RECEIVED MORE THAN ONE SET OF TAX RETURNS, please return both tax returns to us. Write your correct social security

number on each return and mark each return “RECEIVED 2 RETURNS”.

IF YOU MOVED from the beginning of the tax year to present, fill out the Part-Year Resident form. If you lived in different municipalities,

falling under different tax collector jurisdictions during the year, you must prorate your earnings accordingly and file with the appropriate tax

collectors. Also, if you moved during this tax year between different municipalities in our jurisdiction where the tax rates are different, you

will need to file separate returns with us for each residence where there are different tax rates. For assistance in prorating your return

please contact one of our offices.

*For more information on active duty military inside PA, taxable retirement/savings plan distributions, non-taxable items,*

*the military spouse residency relief act, are a resident of a reciprocal state working in our jurisdiction,*

*or want to file for an extension, please go to or contact our office.*

Line by Line Instructions

Line

Instructions

Report your total W-2 income/compensation. Submit one copy of all Form W-2(s) with your return. For full year residents use the

Multiple W-2 Worksheet on the back of the tax return. Carry the total(s) to the appropriate line and column on the tax return. Part-

year residents must complete the moving information requested at the top of the form. Most taxpayers can use their Form W-

2(s) as the source for obtaining their local wages, however, please keep in mind that employers can incorrectly list local wages. If

there are no wages listed in the local wage box use the amount listed in the state wage box first, if none listed use amount listed in

federal wage box. If the wages shown in the local wage box are lower than the wages shown in the federal, social security, or state

wage boxes, the highest amount will be used for local wages unless the W-2, or information you provide, explains the difference as

non-taxable for local purposes. If the Form W-2 (s) has different amounts reported, you may want to ask your employer what makes

up these differences and contact our office to verify the correct amounts to use.

Taxpayers should enter their allowable business expenses from their PA UE schedule(s) on the Net Business Expense Worksheet to

determine how to report on the tax return. The total must be prorated if the taxpayer reported a move for the tax year. In order to

claim the expenses they must be explained in detail and documentation must be available for the tax bureau’s review. The taxpayer

has the burden of proving that any expense claimed as a deduction from earned income is ordinary, actual, reasonable, necessary,

directly related, and 100% required for employment in order to be deducted from earned income. We follow the Pennsylvania

Individual Income Tax regulations and guidelines. For additional information see the “Allowable Business Expense” section of the PA

40 instruction booklet, a copy can be found on our website.

Subtract line 2 from line 1 and enter total here.

(a) Taxpayers should complete the Net Effect Worksheet on the back of the return to calculate the overall net effect of profit(s) and

loss(es). This includes net profits/losses from Schedule C, Schedule F from farming activities, and Form 1065 for Partnership

activities (K-1). Use and submit copies of your PA state schedule K-1 (1065), C or F only if taxpayer is actively engaged in the

business. You must include Schedules C or F, we do not accept the PA SCHEDULE C-F. Do not include loss from tax shelters,

passive limited partnerships, or hobbies. “Pass-through “ income from an S-Corporation is NOT taxable and loss is not deductible.

The taxable portion of a partnership for earned income tax purposes is usually the net earnings from self-employment less any

Section 179 expense (within Pa. guidelines). If a personal retirement plan (Keogh or IRA) has been used as an expense it must be

added to net profit/loss for the earned income tax reporting. Income derived from Limited Liability Companies (LLCs), Limited

Liability Partnerships (LLPs), and Restricted Professional Companies (RPCs) is taxable provided that the participant is actively

engaged in the operation (not a passive or investment type involvement). Taxpayers who are members of these types of entities

should file a copy of their Pa. state Schedule K-1 (Form 1065) for each such entity. A taxpayer's rental income/loss does not apply to

local filing unless the operation is a business (i.e., properly not filed on a schedule E, and subject to business privilege/mercantile

taxes). The leasing of tangible property is the operation of a business only if:

1. You offer the use of your property on a commercial basis to others in marketplace and at least one of the following applies:

* The average period of customer use is 30 days or less; or

* Your property is customarily made available for use only during defined business hours; or

* In addition to the property you also provide significant services to your lessee (Providing housekeeping service, room service,

valet parking, decorating assistance, delivery services, transportation services and concierge services can be significant services.

Providing heat, lighting, electric service elevators, cleaning public access and exit areas, collecting trash, and maintaining the

property in a usable rentable condition are not usually significant services.); or

* The leasing activity is incidental to a real estate sales business; and

2. You offer the use of your property intending to realize a profit; and

Instructions For Filing Form 531 - Local Earned Income Tax (Eit) Return - Pennsylvania - 2014 Page 8

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