Local Income Tax — Payroll Definition

What is Local Income Tax?

Some local jurisdictions impose an income, wage, occupational, or payroll tax in addition to federal and state taxes. The rate, taxable wage base, residence and work-location rules, credits, and filing process vary and can change. A local deduction on a pay statement should be checked against the current instructions from the taxing jurisdiction and the employee's actual work and residence locations.

How to apply this payroll definition

Locate the label beside its current-period amount, taxable-wage basis, and year-to-date total. Compare it with prior genuine statements, benefits materials, the employer's payroll documentation, and the primary source linked on this page. The same abbreviation can carry a different employer-specific meaning.

What the label does not prove

A familiar term or plausible amount does not authenticate a pay statement or confirm identity, employment, wages, deductions, tax compliance, or eligibility. Ask the verified payroll contact about an unknown code. Use current agency instructions or a qualified adviser when a rate, filing, benefit, garnishment, or legal decision depends on the answer.

Browse all payroll definitions or use the pay-statement codes guide.