Are any types of investment income non-taxable?

Yes, some types of investment income is non-taxable in Pennsylvania. Pennsylvania does not tax interest, dividends, capital gains, profits from the sale of stocks and bonds, royalties, and gains from commodities trading. Interest earned on U.S. government obligations, such as U.S. savings bonds, is also non-taxable. In addition, there are some income exemptions that may be applied to certain types of income earned by residents of Pennsylvania. For example, the state does not tax Social Security benefits, pensions, annuities, and other benefits from retired public employees, such as state and local government employees. Some income from qualified retirement plans, such as IRAs and 401(k)s, may also be exempt from taxation in Pennsylvania. Pennsylvania also provides special tax relief for certain types of investment income, such as gains from the sale of mutual funds. In some cases, the state of Pennsylvania allows a partial exclusion from taxable income of up to $250,000 from the sale of a mutual fund or any combination of mutual funds. It is important to note that each type of investment has its own set of rules and regulations that must be followed in order to be exempt from taxation. It is recommended that taxpayers consult a qualified tax professional to ensure that their income is correctly reported and that they are taking advantage of all available exemptions.

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Are any types of investment income non-taxable?

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