PA-41 Schedule N: 2025 PA-41 Schedule N - PA-Source Income and Nonresident Tax Withheld (PA-41 N) (2025)
Pennsylvania · Pennsylvania DOR · Used for tax years 2025
PA-41 Schedule N is used by estates and trusts to calculate Pennsylvania-source income and the share distributed or distributable to nonresident beneficiaries. It also calculates Pennsylvania tax withheld for those beneficiaries and allocates the withholding among them.
Who files this form
Estates and trusts with nonresident individuals or nonresident estates who have distributed or distributable Pennsylvania-source income must complete PA-41 Schedule N. Submit it, along with any accompanying statements, with the PA-41, Fiduciary Income Tax Return.
Schedule N calculates Pennsylvania-source income, the portion distributed or distributable to nonresident beneficiaries, and the tax withheld on their shares.
Estates and trusts without distributed or distributable Pennsylvania-source income are not required to complete this schedule.
What you'll need
Have the following information and schedules available, as applicable:
- Estate or trust identification: The complete name and nine-digit FEIN, or the decedent’s SSN, as shown on PA-41.
- Income schedules: PA Schedule C for business income, PA Schedule F for farm income, PA-41 Schedule D for property sales, and PA Schedule E for rents, royalties, patents and copyrights.
- Apportionment schedule: PA Schedule NRH if a business or farm operates both inside and outside Pennsylvania.
- Income received from other entities: PA-20S/PA-65 Schedules NRK-1 and PA-41 Schedules NRK-1 reporting Pennsylvania-source income.
- Distribution information: PA-41 Schedule DD, beneficiary names and SSNs or FEINs, and the governing instrument or distribution information used to determine each beneficiary’s year-end income percentage.
- Supporting statements: Details for multiple businesses or farms, multiple entities, multiple property sales, or income from more than one estate or trust. For multiple property sales, include each property’s description and gain or loss.
How to file
Complete PA-41 Schedule N and submit it with the PA-41, Fiduciary Income Tax Return, including any required accompanying statements.
The supplied text does not give a mailing address or electronic filing instructions.
Common mistakes
- Using the wrong identification number: An estate with an FEIN should not use the decedent’s SSN.
- Entering negative totals: Enter zero on Section I, Lines 2e, 3c and 4c if the relevant total is a net loss. Losses incurred by an estate or trust cannot be distributed.
- Including excluded winnings: Do not include noncash prizes from the Pennsylvania Lottery.
- Reporting excluded property gains: Do not report gains or losses from intangible property, such as stocks and bonds held in trust in a Pennsylvania bank or trust company, on Section I, Line 3a.
- Leaving out property locations: Every property on PA Schedule E must have an address and location. Otherwise, it will be assumed to be Pennsylvania property.
- Using incorrect beneficiary totals: Section II, Line 10A should not exceed 100 percent. Each beneficiary’s Section II income amount must match Line 1 of their PA-41 Schedule NRK-1, and their Section IV withholding amount must match Line 2.
- Dividing whole-number percentages: In Section IV’s allocation calculation, divide percentages as decimals, such as 0.50 for 50 percent.
Questions people ask
What if a business or farm operates both inside and outside Pennsylvania?
Complete PA Schedule NRH and enter its Section II, Line 5 apportionment percentage on Schedule N, Section I, Line 2b. If the operation is entirely within Pennsylvania, enter 100 percent.
How is nonresident withholding calculated?
In Section III, multiply the distributed or distributable Pennsylvania-source income by the total nonresident beneficiaries’ income percentage. Then multiply that nonresident share by 3.07 percent (0.0307).
What if the calculated withholding is $1 or less?
If Section III, Line 4 is $1 or less and PA-41, Line 10 is zero, enter zero on PA-41, Line 11 and do not complete Schedule N, Section IV.
What if there are more than eight nonresident beneficiaries?
Include a statement or additional PA-41 Schedules N with Sections II and IV completed as applicable. Report the additional beneficiaries’ income percentage totals on the first Schedule N’s Section II, Line 9A. For Section IV, report the additional percentage and withholding totals on the first schedule’s Line 9, Columns A and D.