Pennsylvania (PA) levies a 6% state sales tax, making it essential for businesses to understand collection and remittance obligations. As of 2026, the LLC filing fee is $125 with no annual franchise tax.
Economic Nexus in Pennsylvania
Remote sellers must collect Pennsylvania sales tax if they exceed $100,000 in annual sales within the state. This threshold has been in effect since 2019-04-01. Marketplace facilitators like Amazon and Etsy are also required to collect and remit tax on behalf of third-party sellers. The Pennsylvania Department of Revenue enforces these provisions and provides registration guidance at https://www.revenue.pa.gov.
LLC Formation in Pennsylvania (2026)
Forming an LLC in Pennsylvania costs $125 for the initial filing. There is no annual franchise tax, keeping ongoing costs low. The annual report fee is $70. Pennsylvania imposes a state income tax, which affects pass-through LLC taxation.
The process involves filing Articles of Organization with the Secretary of State, obtaining a federal EIN, and registering for applicable state tax accounts. You will also need a sales tax permit from the Pennsylvania Department of Revenue.
Key Tax Rules
• Pennsylvania has a 6% state sales tax rate.
• Philadelphia adds 2% and Allegheny County adds 1% local tax.
• Clothing and groceries are completely exempt from sales tax.
• Economic nexus threshold is $100,000 in annual sales.
Sales Tax Exemptions
The following categories are generally exempt from sales tax in Pennsylvania: groceries, clothing, prescription drugs, medical devices, textbooks. Businesses should maintain proper documentation for exempt transactions.