Where does a US citizen go thru customs Italy to Toronto?
 

We are planning on flying from Rome>philly>Toronto but live in NY. Where will we have to go through customs? I ask because the layover in Philly is only 2 hours.

Effectively you'll go through U.S. immigration and customs twice. The first time will be in Philadelphia: passport control, claim bags, customs, recheck bags, security, go to connecting flight. The second time will be wherever you cross by land from Canada to USA.

Assuming I'm following you correctly ...

Is the OP driving from Toronto to NY? Stopping over in Canada? Flying from Toronto to NY?

I would think Toronto, assuming the OP is a US citizen who happens to be in Rome and is traveling straight through to Canada. She will not be considered to be entering the US, right, just passing through? Or am I totally misunderstanding?

I thought it was a little confusing. It seems they are driving from Toronto to Upstate NY. That's the impression I got.

The US does not offer the option of just passing through when flying. Every passenger gets off the plane and goes through immigration at their first port of entry in the USA.

No airside transit at PHL that I know of. So, go through US immigration in Philly. And Canadian immigration at Toronto. Doesn't matter what citizenship.

OP didn't say anything about how they're going home to NY, so that's irrelevant as well.