Worried about making estimated BIRT payments next year? Were giving you options.

The City of Philadelphia clarified its Business Income & Receipts Tax (BIRT) policy for businesses filing in 2025 due to a legal challenge impacting the $100,000 exemption. New businesses, which were not required to file in the past three years, will not need to make estimated payments when filing tax returns for 2026. Starting in 2027, these businesses can opt to pay a 100% estimate or make quarterly payments throughout the year. In 2028, they will need to pay an estimated amount equal to the prior year's tax due. This policy aims to ease the tax burden on emerging businesses while ensuring compliance with the tax code.

The City has allowed new businesses to bypass initial estimated payments since 2018, creating a more supportive environment for startups. The Department of Revenue recommends that business owners consult with tax professionals familiar with local taxes. Future announcements regarding free tax preparation services and grant programs are expected from the Department of Commerce.