Taxes

TAX
In Pennsylvania, Boroughs have the authority to impose various types of taxes to fund local government services and infrastructure. These taxes help Boroughs maintain essential services such as police, fire protection, road maintenance, and public health.

Here's an overview of the primary types of taxes that can be levied by a Borough in Pennsylvania:

REAL ESTATE TAX
Real estate tax is one of the primary sources of revenue for Boroughs in Pennsylvania. It is imposed on property owners based on the assessed value of their property.

Northampton County Assessment Office carries the responsibility for creating and maintaining values for all properties in the County based on the rules and regulations of the Commonwealth of Pennsylvania.

If you have questions regarding the assessed value of your property or other assessment related questions, please utilize the link below to be redirected to the Northampton County Assessment Office.

Each Borough sets its own millage rate (the amount of tax per $1,000 of assessed property value), and property owners are required to pay this tax annually. The assessment value of a property is determined by the county assessment office.

Freemansburg Borough's current millage rate is 18.26 mills

Freemansburg's Tax Collector invoices and collects real estate tax for every applicable property within the Borough.

REALTY TRANSFER TAX
In most of Pennsylvania there is a Realty Transfer Tax of 2% imposed on the transfer or sale of all property in Pennsylvania. The tax is typically based on the value of the property or interest being conveyed. This value is not necessarily the sales price. The 2% Transfer Tax is paid at the time of recording.

For properties sold or transferred in Freemansburg, this tax is split between the State and the Borough and School District as follows:

• 1% goes to the State of Pennsylvania.
• 1% is split between Freemansburg and the Bethlehem Area School District.

EARNED INCOME TAX ("EIT")
Earned income tax is a tax on wages, salaries, and other forms of compensation for residents and workers within the Borough.

The rate for earned income tax can vary from one Borough to another, and is typically withheld from an employee’s paycheck by their employer. If a person is self-employed, they must file quarterly payments with the local tax authority.

The easy way to find the resident rate of an employee and/or the non- resident rate of a business:
  https://apps.dced.pa.gov/Munstats-public/FindLocalTax.aspx

The EIT tax rate is 1.0% of an individual's gross earned income. Of the 1.0% collected, Freemansburg Borough receives 0.5% and the Bethlehem Area School District receives 0.5%.

Freemansburg Borough has authorized the Northampton Tax Collection Committee (“TCC”), an agency created under the requirements of Pennsylvania Act 32 of 2008, to administer and collect earned income tax from all employers and residents in the Northampton Tax Collection District (TCD).

In September 2010, the TCC chose Keystone Collections Group as the Tax Officer for the TCC. Please click on the link below to be redirected to the website for Keystone, the Tax Officer for the Northampton TCC, including the place for employers to go to register to submit their forms and remit their quarterly withholdings electronically.

LOCAL SERVICE TAX ("LST")
LST is a local tax payable by all individuals who hold a job or profession within a taxing jurisdiction imposing the tax. It is due quarterly on a prorated basis determined by the number of pay periods for a calendar year.

The current maximum statutory rate of the LST, non-distressed communities is $52, and is subject to sharing between municipality and the school district if both impose the tax. (Areas under ACT 47 rulings may enact the tax up to maximum rate of $156.00)

Freemansburg has authorized Berkheimer Tax Innovations as the authorized LST collector for the Borough.

Freemansburg Borough’s LST rate is $52.00 annually.

The Political Subdivision Code (“PSD”) Code for Freemansburg Borough is 480204

If you have questions regarding LST, please click on the link below to be redirected to the website for Berkheimer Tax Innovations.

BUSINESS PRIVILEGE TAX/ MERCANTILE TAX
Business Privilege Taxes/Mercantile Taxes are imposed on businesses for the right to conduct business in a Municipality. Privilege taxes are usually based on the gross receipts.

A Business means carrying on or exercising for gain or profit, in the Taxing District, any trade, business, profession, vocation or commercial activity, or making sales in the Taxing District; a profession or vocation or any rendering of personal services in the Taxing District in any capacity, except as an employee of another, is a Business.

Gross receipts means gross consideration received in any sale made or services rendered; or commercial or business transaction occurring in or attributable to the taxing district including cash, credits and property of any kind or of any nature without deduction on account of the cost of materials, labor, services or other costs, interest or discount paid or any other expenses whatsoever.

Freemansburg Borough imposes privilege tax on businesses.

Freemansburg has authorized Berkheimer Tax Innovations as the authorized BPT collector for the Borough.

If you have questions regarding BPT, please click on the link below to be redirected to the website for Berkheimer Tax Innovations.

PER CAPITA TAX
Per Capita Tax is a flat rate local tax payable by all adult residents living within a taxing jurisdiction. For most areas “adult” is defined as 18 years of age and older, though in some areas the minimum age may differ. This tax is due yearly and is based solely on residency, it is NOT dependent upon employment or property ownership. Municipalities and school districts were given the right to collect a $10.00 per capita tax under ACT 511, and School Districts an additional $5.00 under ACT 679 – School Tax Code.

Freemansburg Borough does not currently charge its residents a Per Capita Tax.

OCCUPATIONAL ASSESSMENT TAX ("OAT")
OAT is assessed on all employed residents that hold an occupation. The OAT can be a flat tax rate or an assessed value depending upon your occupation.

Each county in the commonwealth establishes their own list of occupation codes and the value assigned to each. Those values are then applied to the millage rate (a mill is $1.00 of tax per $1000 of assessed value) to arrive at the tax amount due.

Municipalities and school districts levying Per Capita Tax, Occupational Assessment Tax or both of these taxes use the revenues generated by them to fund their programs offered to the citizens of the tax.

Freemansburg Borough does not currently charge its residents an Occupational Assessment Tax.

TAX COLLECTOR
Freemansburg Borough’s Tax Collector is an officer elected at municipal elections every four years and must be a properly qualified individual. Except as otherwise provided by the he Local Tax Enabling Act, § 1086 of Borough Code (Title 8), provide the Tax Collector with the powers and duties to be the collector of all State, county, borough, school, institution district and other taxes levied within the borough by the authorities empowered to levy taxes.