Pennsylvania Gov. Josh Shapiro promotes tax break for working families

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With a little over two weeks to go before tax filings are due, Pennsylvania officials are ramping up efforts to raise awareness about a new tax credit aimed at delivering direct financial relief to working families.

The program, known as the Working Pennsylvanians Tax Credit, was enacted last year. Officials say nearly 1 million residents are eligible, though less than half have claimed it so far.

“We want you, when you file your taxes, to get this relief,” Gov. Josh Shapiro said during a visit Friday to the Children’s Hospital of Philadelphia’s Karabots Pediatric Care Center.

What the tax credit does

The credit allows eligible workers to receive up to $805 back on their state income taxes, with higher amounts available depending on income and number of dependents. In its first year alone, it is projected to deliver roughly $193 million in total relief.

Revenue Secretary Pat Browne described the credit as “the most impactful change to promote equity and fairness in our entire tax system since the personal income tax was enacted over 50 years ago.”

“As of right now, those who have filed and claimed it, 99% of those who have claimed it have been approved for it,” he said.

Nearly 500,000 claims have already been approved, according to the Pennsylvania Department of Revenue, totaling over $125 million returned to taxpayers. Officials expect hundreds of thousands more to apply in the final weeks of tax season.

The credit represents a rare bipartisan agreement on tax policy in Pennsylvania. Lawmakers and governors had discussed similar proposals for years, but only recently reached consensus.

“We worked hard and brought Democrats and Republicans together to finally get this done after decades of people talking about it,” Shapiro said. “This is the first progressive tax bill to hit the desk of a governor in decades, and that’s a big darn deal and it’s helping a whole lot of people.”

State leaders have framed the measure as part of a broader effort to make the tax code more equitable, particularly for low- and moderate-income workers. With the filing deadline approaching, the administration’s message is increasingly direct: The benefit is available now, but only for those who claim it.

“We don’t want to leave any money on the table,” said state Sen. Vincent Hughes, D-Philadelphia, who serves as chair of the appropriations committee. “The money is there … Go get it.”

Who benefits

Despite the program’s scale, officials say awareness remains a major barrier. In Philadelphia — where the state estimates 87,000 residents are eligible — half of them have yet to apply. As a result, the governor is focused on outreach, encouraging people to check eligibility through online tools or free tax preparation services.

The credit is modeled after the federal Earned Income Tax Credit, and anyone eligible for that will automatically qualify for the Working Pennsylvanians Tax Credit, which equals 10% of the federal credit. Pennsylvania residents who are not sure can use an online calculator set up by the Department of Revenue to check.

Shapiro said that government policies are only effective if people can access them, highlighting the partnership with CHOP and the Campaign for Working Families as the essential “execution” arm that connects citizens with the benefits they have earned.

The Campaign for Working Families is a nonprofit organization that provides free tax preparation services to low- to moderate-income individuals and families. President and CEO Dr. Nikia Owens said that “the Working Pennsylvanians tax credit builds on these efforts by returning additional dollars to working individuals and families, helping households meet essential needs.”

Dr. Joe Mitchell, president of CHOP, connected such financial support with the overall health of lower-income residents who would qualify for the tax credit.

“That’s why the Working Pennsylvania tax credit is so vital,” he said. “It puts money back into the pockets of working families to help cover everyday essentials. Essentials like education, like good nutrition, like health care, like affordable housing. And these are the things that actually improve kids’ outcomes.”

Stephanie Ward, a health care worker and single mother of three, said the credit made a meaningful difference after she fell behind on bills due to an injury.

“The tax credit has truly been a blessing and a tremendous, great help,” she said.