Based on statutory changes in October 2018, anyone that pays Pennsylvania-source nonemployee compensation or business income to a nonresident individual or disregarded entity that has a nonresident member and is required to file a federal Form 1099-MISC is required to withhold an amount equal to the tax rate specified at Pa. Stat. Ann. 72 Section 7302 (presently 3.07 percent) from such payments. (See our prior coverage here.) Although these requirements became effective on Jan. 1, the Pennsylvania Department of Revenue stated that any income subject to the withholding provisions would not be subject to an underwithholding assessment if a payor fails to withhold for a period ending prior to July 1.