As of August 2015, the Pennsylvania Department of Revenue uses school district codes to make mandatory annual reports to the state's Department of Education. This report identifies the total state taxable income of each school district in Pennsylvania. The Education Department bases funding for each district on its total income.
Pennsylvania taxpayers put school district codes on their personal income tax returns. This lets the Department of Revenue collect information about state taxable income for each taxpayer. Taxpayers identify the school districts they lived in as of Dec. 31 of the appropriate tax year. Even if a taxpayer moves after that date but before filing taxes, the prior school district code applies.