An Act amending the act of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of 1971, in personal income tax, further providing for imposition of tax, for when withholding not required, for returns and liability and for return of Pennsylvania S corporation.

HB 1742 eliminates Pennsylvania's personal income tax for tax years beginning on or after January 1, 2026. It removes the requirement for employers to withhold income tax from wages starting in 2026 and repeals filing obligations for Pennsylvania S corporations for tax years starting after 2025. The bill directly affects Pennsylvania residents, employers, and S corporations by ending income tax liability, withholding, and related return filings for future tax years. Key provisions amend Sections 302(a), 323, 330(a), and 330.1(a) of the Tax Reform Code of 1971 to reflect these changes. The law takes effect immediately, but the tax changes apply only to tax years beginning in 2026 or later.