Philadelphia has eliminated the $100,000 exclusion for the Business Income and Receipts Tax (BIRT). This means that many small landlords who previously did not pay this tax will now be required to do so starting with their 2025 income.
Key details:
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BIRT filings and payments will begin by April 2026.
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The city will treat these landlords as “new businesses,” allowing some relief with phased payments and quarterly installments starting in 2027.
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Free tax assistance and accountant matching will be available for landlords with under $250,000 in annual revenue.
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Landlords can offset losses from 2022–2024 against 2025 taxable income.
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Tax rates will gradually decrease, with significant reductions planned by 2039.
Impact on small landlords:
While the city is providing support to ease the transition, the removal of the exclusion means additional tax obligations and administrative responsibilities for many small landlords. This change is likely to increase costs and reduce profits for those with smaller portfolios.
While the city is providing support to ease the transition, the removal of the exclusion means additional tax obligations and administrative responsibilities for many small landlords. This change is likely to increase costs and reduce profits for those with smaller portfolios.