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In Boguslavsky v. N. Pocono Sch. Dist.,
2010 Pa. Commw. LEXIS 677 (Pa. Commw. Ct. Dec. 16, 2010) [enhanced version available to lexis.com subscribers / unenhanced version available from lexisONE Free Case Law], a taxpayer's complaint against a school
district alleged, inter alia, that the district's earned income tax violated
constitutional principles of uniformity because: (1) the tax was imposed on
earned income but not unearned income; and (2) the tax was imposed on employee
contributions to 401(k) plans but not employer contributions to 401(k) plans.
The trial court granted summary judgment to the district, and the taxpayer
appeal, the court affirmed. Addressing the taxpayer's 401(k) contributions argument,
the court stated:
Kalodner v. Commonwealth, 150 Pa. Commw. 248, 615 A.2d 900, 904 (Pa.
Cmwlth. 1992) [enhanced version], this court considered whether an income
tax unjustifiably discriminates against self-employed persons because it taxes
as income the contributions to a retirement plan made by a self-employed person
but does not tax the contributions to a retirement plan made by an employer for
the benefit of an employee. This court held that the tax was justified because
the contributions made by self-employed persons come from money they actually
received as income, but the contributions made by employers for the benefit of
employees may not have been actually or constructively received by the
employees due to substantial limitations and restrictions on the receipt of
benefits under the retirement plan. Thus, this court
has articulated a reason justifying the exclusion from income, for tax
purposes, of an employer's 401(k) contributions.
and citations omitted)