The company asked me to come into the office only two days a week, so the other three days were spent working from home, and I thought I would get a refund for the Wage Tax for those three days. This is a common calculation for those living outside of Philadelphia but working in the city.

However, according to the Department of Revenue, a refund may not be possible in this case. They consider not whether you worked outside the city, but whether the company required you to work outside the city.

Let's start with the tax rates. According to the official city table, starting July 1, 2026, non-residents will be taxed at 3.425%, while residents will be taxed at 3.735%.

This is a slight decrease from the previous rates of 3.43% and 3.74%. Since this tax applies to the entire salary, the reduction doesn't feel significant.

Residents are excluded from this discussion. If you live within the city, you pay taxes regardless of where you work, and you cannot receive a refund for working outside the city.

The criteria for non-residents is the "requirement of employment" test. Simply put, only the days when the employer required you to work outside the city are exempt from tax.

If you worked from home for your own convenience, even if the company allowed it, it is still taxable. This information is clearly stated in the 2025 refund form guidance.

What the company allows and what the company requires are entirely different matters. Refunds hinge on this distinction.

The guidance updated by the city on October 12, 2023, provides eight examples, including employees of accounting firms. You can compare these with your company's policies.

If the company required you to work two days a week for a client in Montgomery County, those two days are tax-exempt. Days when you have to work from home due to a lack of office space are also eligible for a refund.

Conversely, what if the company allows employees to choose to work from home whenever they want? In that case, both office days and remote days are fully taxable.

The fifth example caught my attention the most. The company has a written policy mandating two days in the office, but employees can come in as much as they want.

The city's conclusion is that both in-office days and remote days are taxable. If you can come in more often, then staying home is ultimately your choice.

The University of Pennsylvania also cited this example in a supervisor guidance document revised in February 2026. It clearly states that remote days for hybrid employees are not eligible for refunds.

Health-related reasons vary by condition. If company policy requires remote work for employees with underlying health conditions, or if remote work is necessary due to ADA accommodations for an inaccessible office, those days are tax-exempt.

However, days worked from home due to childcare issues with manager approval are taxable. While the circumstances may be understandable, the city classifies this as employee convenience.

Fully remote work is treated separately. If you work entirely from home outside the city and only visit the office a couple of times a year, without a dedicated workspace or regular in-office options, you are not subject to tax.

So how much money are we talking about? To find the non-taxable amount, multiply the proportion of days worked outside the city at the company's request by your salary.

Let's assume an annual salary of $100,000 with 240 actual working days, of which 60 days were worked outside the city at the company's request. The proportion is 25%, so $25,000 is non-taxable income.

Applying just the 3.43% rate gives us $857.50. The actual form calculates this based on different rates for the first and second halves of the year, so the amount may vary slightly.

Weekends, vacations, holidays, and sick days are excluded from working days. Bonuses are taxable, but you can deduct the proportion of outside city work for that year.

The basic documents required are the W-2 and the Employer Certification Letter. You need to transfer the form provided by the city onto the company letterhead and get it signed by the responsible person.

There is also a form to record the dates and locations of work done outside the city, which must match the company certification. Keeping track of this information as you go will save you trouble later.

The signature on the certification confirms that the company acknowledges that this employee was required to work outside the city. Therefore, if it was for convenience, it wouldn't be surprising if HR refused to sign.

You can submit your application without an ID at tax-services.phila.gov, and if you file online, you will receive your refund via direct deposit. The city's stated processing time is 6 to 8 weeks.

The deadline is three years from the later of the date you paid the tax or the payment deadline. Refund applications are made after the tax year ends, so for 2026, you can prepare after receiving next year's W-2.

Just because you get a refund doesn't mean it's the end of the story. The Penn guidance states that there may be other local taxes for days worked outside the city, and it is the employee's responsibility to verify this.

In my opinion, the rule that taxes days when you didn't even step foot in the city is hard to accept. It seems excessive to those who support a smaller government.

Senate Bill 527, which aims to change this, passed the state senate with a vote of 29 to 21. As of the press release from the House of Representatives on April 15, 2026, it remains with the House Finance Committee, and I have not been able to check on its progress since then.

Until the law changes, we have no choice but to follow the current rules. If your company's policy is unclear, you can ask the guidance at [email protected] or consult a tax professional.

If I were you, I would do three things this year. Get the remote work policy in writing, ask HR if a certification is possible, and keep a calendar of the dates worked outside the city.

It's more important to have documentation showing that the company required you to work than how many times you worked from home. Just remembering this order will reduce unnecessary trips.