🇺🇸 Massachusetts Income Tax — 2026 UPDATE

Massachusetts Income Tax Rates & Brackets (Tax Year 2025 — Filed in 2026)

⚠️Informational only — not legal or tax advice.

Tax year covered: 2025 (returns filed in 2026)
Applies to: Income earned January 1 – December 31, 2025
Returns filed: January – April 2026
Last verified: February 12, 2026

Massachusetts State Income Tax

Table of Contents

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Quick Reference

Does Massachusetts have income tax? Yes
Tax structure: Flat rate with surtax on high earners
Tax rates: 5.0% (plus 4% surtax on income over $1,083,150)
Standard deduction (Single): No standard deduction (uses personal exemptions instead)
Standard deduction (Married): No standard deduction (uses personal exemptions instead)
Local income tax: No
Official source: https://www.mass.gov/info-details/massachusetts-tax-rates

Key Takeaways

  • Residents: Massachusetts residents pay state income tax on income from all sources
  • Non-residents: Non-residents pay Massachusetts income tax only on Massachusetts-source income
  • Tax rates: 5.0% flat rate on most income types, with certain capital gains taxed at 8.5% or 12%, plus an additional 4% surtax on taxable income exceeding $1,083,150 (2025 threshold)
  • Local income tax: No – Massachusetts does not permit local income taxes
  • Reciprocity: None – Massachusetts has no reciprocal agreements with other states
  • Primary forms: Form 1 (residents), Form 1-NR/PY (non-residents and part-year residents)

Quick Questions About Massachusetts Income Tax

What is the Massachusetts income tax rate for 2025? Massachusetts has a 5.0% flat income tax rate on most income types. Certain long-term capital gains on collectibles are taxed at 12%, and certain short-term capital gains are taxed at 8.5%. Additionally, taxpayers with taxable income exceeding $1,083,150 pay an additional 4% surtax on the amount above this threshold.

Does Massachusetts have state income tax? Yes, Massachusetts levies a state personal income tax at a 5.0% flat rate, with an additional 4% surtax on income over $1,083,150.

What are the income tax brackets in Massachusetts? Massachusetts does not use traditional income tax brackets. The state applies a flat 5.0% tax rate to most income, regardless of income level. However, an additional 4% surtax applies to taxable income exceeding $1,083,150 for Tax Year 2025.

Is Social Security taxed in Massachusetts? No, Massachusetts does not tax Social Security benefits.

Does Massachusetts tax retirement income? Massachusetts does not tax pension income from Massachusetts state or local government service, or from the U.S. government (including military pensions). Private pensions and distributions from 401(k) plans and traditional IRAs are generally taxable.

Do I need to file a Massachusetts income tax return? You must file if your Massachusetts gross income is $8,000 or more. The $8,000 threshold applies per person – both spouses must meet this threshold individually to be required to file jointly.

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Massachusetts Income Tax Rates and Brackets (2026)

The following tax rates and brackets apply to income earned in 2025, reported on tax returns filed in 2026.

Rate Snapshot
Tax Attribute Amount/Status
Lowest Tax Rate 5.0%
Highest Tax Rate 9.0% (5.0% base + 4% surtax)
Tax Structure Flat rate with high-income surtax
Number of Brackets Flat rate (no brackets for base rate)
State Income Tax Yes
Local Income Tax No
Personal Exemptions (Single) $4,400
Personal Exemptions (Married Filing Jointly) $8,800
Personal Exemptions (Head of Household) $6,800
Dependent Exemption $1,000 per dependent

Source: https://www.mass.gov/info-details/massachusetts-tax-rates

Massachusetts Income Tax Brackets 2026
All Filing Statuses – Base Income Tax. Massachusetts applies a flat 5.0% tax rate on most income types for all filing statuses.
Income Type Tax Rate
Wages, salaries, tips 5.0%
Business and professional income 5.0%
Interest and dividends 5.0%
Long-term capital gains (standard) 5.0%
Short-term capital gains (certain types) 8.5%
Long-term capital gains on collectibles 12.0%

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

4% Millionaire's Tax Surtax (All Filing Statuses)
Taxable Income Additional Surtax Rate
$0 - $1,083,150 0%
Over $1,083,150 4% on amount exceeding threshold

Effective tax rate on income over $1,083,150: 9.0% (5.0% base + 4.0% surtax)

The 4% surtax applies to the portion of taxable income that exceeds the threshold. For example, if your taxable income is $1,200,000:

  • First $1,083,150 taxed at 5.0%
  • Remaining $116,850 taxed at 9.0% (5.0% + 4.0% surtax)

The surtax threshold is adjusted annually for inflation. The threshold was $1,000,000 in 2023 and has increased each year.

Source: https://www.mass.gov/info-details/massachusetts-4-surtax-on-taxable-income

Special Capital Gains Rates

Massachusetts taxes certain capital gains at different rates:

Short-term capital gains (assets held one year or less):

  • General rate: 8.5%
  • Subject to 4% surtax if total income exceeds threshold

Long-term capital gains on collectibles:

  • Rate: 12.0% (with 50% deduction available, effectively 6.0% on eligible gains)
  • Subject to 4% surtax if total income exceeds threshold

Long-term capital gains (assets held more than one year):

  • Rate: 5.0% (taxed at regular rate)
  • Subject to 4% surtax if total income exceeds threshold

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Statutory Authority

State income tax in Massachusetts is authorized under the following legal framework:

Constitutional Authority:

  • Massachusetts Constitution, Article 44 of the Amendments
  • This constitutional amendment, adopted in 1915, authorizes the General Court to impose taxes on income
  • Article 44 requires that all income of the same class be taxed at the same rate, which is why Massachusetts uses a flat tax rate rather than graduated brackets

Statutory Authority:

  • Massachusetts General Laws, Chapter 62 – Taxation of Incomes
  • M.G.L. c. 62, § 4: Imposes tax on residents’ taxable income
  • M.G.L. c. 62, § 5A: Imposes the 4% surtax on taxable income exceeding the threshold (effective January 1, 2023)
  • M.G.L. c. 62, § 5B: Tax rates on different classes of income
  • M.G.L. c. 62, § 10: Non-residents’ tax obligations
  • Available at: https://malegislature.gov/Laws/GeneralLaws/PartI/TitleIX/Chapter62

Administrative Regulations:

Legislative History:

  • Original enactment: 1916 (first income tax law)
  • Major amendments: 2002 (capital gains tax simplification), 2023 (4% surtax on high earners)
  • Current structure effective: January 1, 2020 (5.0% flat rate); January 1, 2023 (4% surtax)
  • The 4% surtax was approved by Massachusetts voters through a ballot initiative (Question 1) in November 2022

This page compiles information directly from these statutory and regulatory authorities as implemented by the Massachusetts Department of Revenue.

Source: https://malegislature.gov/Laws/GeneralLaws/PartI/TitleIX/Chapter62 and https://www.mass.gov/regulations/830-CMR-personal-income-tax

Who Must File Massachusetts Income Tax

Residents

Massachusetts tax law requires residents to file a state income tax return if:

  • Massachusetts gross income is $8,000 or more

Important note: The $8,000 threshold is per person, not per household. If you are married filing jointly, each spouse must meet the $8,000 threshold individually to be required to file jointly. If only one spouse meets the threshold, that spouse may file separately.

Residency status: You are a Massachusetts resident if your domicile (permanent home) is in Massachusetts, OR if you maintain a home in Massachusetts and spend more than 183 days of the tax year in Massachusetts (including days spent partially in Massachusetts).

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Part-Year Residents

Part-year residents file if they:

  • Were a Massachusetts resident for part of the year, AND
  • Had Massachusetts gross income of more than $8,000 during the entire year (from any source)

Part-year resident status applies if you:

  • Moved into Massachusetts during the tax year and established domicile, OR
  • Moved out of Massachusetts during the tax year and established domicile elsewhere

Part-year residents report all income earned while a Massachusetts resident, regardless of source, and income from Massachusetts sources earned while a non-resident.

Source: https://www.mass.gov/guides/personal-income-tax-for-part-year-residents

Non-Residents

Non-residents file if they had income from Massachusetts sources AND:

  • Massachusetts gross income exceeded $8,000, OR
  • Massachusetts gross income exceeded the prorated personal exemption (whichever is less)

Massachusetts source income includes:

  • Wages earned while physically working in Massachusetts
  • Business income from operations conducted in Massachusetts
  • Rental income from Massachusetts property
  • Income from partnerships, S corporations, or trusts with Massachusetts operations

Physical presence rule: Income is sourced to Massachusetts based on where work is physically performed. The location of the employer does not determine sourcing.

Source: https://www.mass.gov/guides/personal-income-tax-for-nonresidents

What Income Is Taxable in Massachusetts

Fully Taxable Income

Massachusetts taxes the following types of income at 5.0%:

  • Wages, salaries, tips, and other employee compensation
  • Self-employment income
  • Business and professional income
  • Partnership and S corporation income
  • Rental income (net of expenses)
  • Interest income (except Massachusetts bank interest up to exemption amount)
  • Dividend income
  • Most long-term capital gains
  • Unemployment compensation
  • Certain gambling and lottery winnings
  • Distributions from traditional IRAs and 401(k) plans
  • Private pension income

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Short-Term Capital Gains (8.5% Rate)

Effective January 1, 2023, short-term capital gains (assets held one year or less) are taxed at 8.5% rather than 12%.

These gains must be reported on Schedule B.

Source: https://www.mass.gov/news/tax-credits-to-help-put-money-in-your-pocket

Long-Term Capital Gains on Collectibles (12% Rate)

Long-term gains from the sale or exchange of collectibles are taxed at 12% with a 50% deduction available, resulting in an effective rate of approximately 6.0%.

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Social Security Benefits

Massachusetts does not tax Social Security benefits. This includes:

  • Retirement benefits
  • Disability benefits
  • Survivor benefits

Social Security benefits are fully exempt from Massachusetts income tax.

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Military Retirement Pay

Massachusetts fully exempts military retirement pay from state income tax.

This exemption applies to retirement pay received by members of:

  • U.S. Armed Forces
  • Reserve components
  • National Guard

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Pension Income

Public pensions (fully exempt):

  • Massachusetts state employee pensions
  • Massachusetts municipal employee pensions
  • U.S. government pensions (including federal civilian employees)
  • Military retirement pay

Private pensions (taxable):

  • Private employer pension plans are fully taxable
  • No exemption or exclusion available

Retirement account distributions:

  • Traditional IRA distributions: Fully taxable
  • 401(k) distributions: Fully taxable
  • Roth IRA distributions: Not taxable (if qualified distributions)
  • Roth 401(k) distributions: Not taxable (if qualified distributions)

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Massachusetts Bank Interest Exemption

Repealed effective January 1, 2024: The exemption for Massachusetts bank interest (previously up to $100 for single filers, $200 for joint filers) has been eliminated.

All interest from Massachusetts banks is now fully taxable.

Source: https://www.mass.gov/technical-information-release/tir-24-14-tax-provisions-in-the-fiscal-year-2025-budget

Personal Exemption

Massachusetts does not use a standard deduction. Instead, the state provides personal exemptions that reduce taxable income.

Personal Exemptions (Tax Year 2025)

Based on filing status:

  • Single: $4,400
  • Married Filing Jointly: $8,800
  • Married Filing Separately: $4,400
  • Head of Household: $6,800

Additional exemptions:

  • Each dependent: $1,000
  • Taxpayer age 65 or older by end of year: $700
  • Spouse age 65 or older by end of year: $700
  • Taxpayer blind: $2,200
  • Spouse blind: $2,200

Special Exemptions

Medical/dental expenses exemption: If you itemize deductions on your federal return (U.S. Schedule A) and have medical/dental expenses exceeding 7.5% of federal AGI, you may claim an exemption equal to the amount reported on U.S. Schedule A, Line 4.

Adoption agency fee exemption: You may claim an exemption for fees paid to a licensed adoption agency to adopt a minor child.

Source: https://www.mass.gov/info-details/massachusetts-personal-income-tax-exemptions

How Exemptions Work

Exemptions directly reduce your taxable income. They are subtracted after calculating your Massachusetts adjusted gross income.

Example calculation:

  • Massachusetts adjusted gross income: $60,000
  • Filing status: Single ($4,400 exemption)
  • One dependent: $1,000 exemption
  • Total exemptions: $5,400
  • Taxable income: $54,600
  • Tax at 5.0%: $2,730

Source: https://www.mass.gov/doc/2025-form-1-instructions/download

Nonresident and Part-Year Resident Exemptions

Nonresidents: Multiply total exemptions by the Nonresident Deduction and Exemption Ratio (Massachusetts source income ÷ total income from all sources).

Part-year residents: Multiply total exemptions by the Total Days as Massachusetts Resident ratio (days as resident ÷ 365).

Source: https://www.mass.gov/info-details/ma-nonresident-and-part-year-resident-deductions-and-exemptions

Massachusetts Income Tax Credits

Massachusetts offers several tax credits that directly reduce the amount of tax owed (or provide refunds if credits exceed tax liability).

1. Massachusetts Earned Income Tax Credit (EITC)

The Massachusetts EITC is a refundable credit equal to 40% of the federal EITC.

Eligibility:

  • You must qualify for the federal EITC
  • You must be a Massachusetts resident for at least part of the tax year
  • Nonresidents for the entire year do not qualify
  • Married filing separately generally do not qualify (exception for domestic abuse victims)

Credit amount (2025): Massachusetts credit = 40% of federal EITC amount

Maximum federal EITC amounts for 2025:

  • No qualifying children: $649
  • 1 qualifying child: $4,213
  • 2 qualifying children: $6,960
  • 3+ qualifying children: $7,830

Maximum Massachusetts EITC amounts for 2025:

  • No qualifying children: $260 (40% of $649)
  • 1 qualifying child: $1,685 (40% of $4,213)
  • 2 qualifying children: $2,784 (40% of $6,960)
  • 3+ qualifying children: $3,132 (40% of $7,830)

Part-year residents: Credit is prorated based on the number of days as a Massachusetts resident divided by 365.

Investment income limit: Investment income cannot exceed $11,950 for tax year 2025.

Source: https://www.mass.gov/info-details/massachusetts-earned-income-tax-credit-eitc

2. Child and Family Tax Credit

The Child and Family Tax Credit is a refundable credit of $440 per qualifying individual.

Eligibility:

  • Must maintain a household in Massachusetts
  • Must be a resident or part-year resident (nonresidents do not qualify)
  • No income limit
  • No limit on number of qualifying individuals

Qualifying individuals:

  • Dependent child under age 13
  • Dependent age 65 or older (cannot be you or your spouse)
  • Dependent with a disability
  • Spouse with a disability

Credit amount: $440 per qualifying individual

Example: A family with two children under 13 and one elderly parent (age 70) receives $1,320 ($440 × 3).

Part-year residents: Credit is prorated based on the number of days as a Massachusetts resident divided by 365.

Important note: Qualifying individuals do not need to have a Social Security Number or Individual Taxpayer Identification Number to be eligible for this credit (effective tax year 2023).

Source: https://www.mass.gov/info-details/massachusetts-child-and-family-tax-credit

3. Senior Circuit Breaker Tax Credit

The Circuit Breaker provides property tax or rent relief for seniors age 65 and older.

Eligibility:

  • Age 65 or older by December 31 of the tax year
  • Massachusetts resident or part-year resident
  • Own or rent residential property in Massachusetts occupied as primary residence
  • Total Massachusetts income must not exceed:
    • $75,000 (single filers)
    • $94,000 (head of household filers)
    • $112,000 (married filing jointly)
  • For homeowners: assessed value of principal residence cannot exceed $1,298,000 (2025 limit)

Credit calculation: Credit equals the amount by which property taxes paid (or 25% of rent paid) exceeds 10% of total income.

Maximum credit for 2025: $2,820

Example:

  • Total income: $50,000
  • Property taxes paid: $7,000
  • 10% of income: $5,000
  • Credit: $2,000 ($7,000 – $5,000)

The credit is refundable. If it exceeds your tax liability, you receive the difference as a refund.

Filing requirement: Must complete Schedule CB and file it with your Massachusetts return within 3 years of the original due date.

Source: https://www.mass.gov/info-details/massachusetts-senior-circuit-breaker-tax-credit

4. Rental Deduction

Massachusetts allows a deduction (not a credit) for rent paid on a principal residence in Massachusetts.

Amount: 50% of rent paid, up to maximum of:

  • $4,000 for most filers (resulting in maximum deduction of $2,000)
  • $2,000 for married filing separately (resulting in maximum deduction of $1,000)

Eligibility:

  • Residence must be in Massachusetts
  • Must be your principal residence
  • Nonresidents are entitled to this deduction only if they have no legal residence outside Massachusetts

How it works: The deduction reduces your taxable income, not your tax directly.

Example:

  • Rent paid in 2025: $20,000
  • 50% of rent: $10,000
  • Maximum deduction: $4,000 (the lesser of $10,000 and $4,000)
  • Deduction claimed: $2,000 (50% of the maximum $4,000)

Source: https://www.mass.gov/info-details/2023-massachusetts-tax-cuts-legislation

5. Lead Paint Removal Credit

Massachusetts offers a credit for costs incurred to remove or cover lead paint in residential property.

Maximum credit amounts (effective 2023):

  • Complete deleading: $3,000 per residential unit (doubled from $1,500)
  • Partial removal or covering: $1,000 per residential unit (doubled from $500)

Eligibility:

  • Property must be located in Massachusetts
  • Work must be performed by licensed/certified contractor
  • Must comply with Massachusetts lead paint regulations

Source: https://www.mass.gov/info-details/2023-massachusetts-tax-cuts-legislation

6. Septic System Repair/Replacement Credit

Credit available for repairing or replacing a failed cesspool or septic system.

Maximum credit: 40% of costs, up to $6,000 maximum credit (on $15,000 of costs)

Eligibility:

  • Property must be your primary residence in Massachusetts
  • System must have failed as determined by local board of health
  • Work must be completed by licensed contractor
  • Claim credit on Schedule SC

Source: https://www.mass.gov/doc/2025-schedule-sc-septic-credit-for-repairing-or-replacing-a-failed-cesspool-or-septic-system/download

7. Other Credits

Additional credits available:

  • Qualified veterans hire tax credit ($2,500 per eligible veteran hired, for qualifying employers)
  • Lead removal credit for rental property owners
  • Community investment tax credit (for donations to CDCs)
  • Film production credit
  • Historic rehabilitation credit

Most business-related credits require specific forms and may have carryforward provisions.

Source: https://www.mass.gov/news/save-on-taxes-tax-credits-for-massachusetts-taxpayers

Filing Deadlines

Regular Deadline

April 15, 2026 for Tax Year 2025 returns

If April 15 falls on a weekend or legal holiday, the deadline moves to the next business day.

Extension Deadline

October 15, 2026

To receive an extension, taxpayers must:

  • File Form M-4868 (Massachusetts Income Tax Extension Payment Worksheet and Voucher) by April 15, 2026
  • Pay any estimated tax owed by April 15, 2026
  • An extension grants additional time to file, but does not extend the time to pay

Extension filing options:

  • Electronically through MassTaxConnect
  • Paper form (if payment is less than $5,000)
  • Taxpayers owing $5,000 or more must file and pay electronically

Automatic federal extension: Massachusetts generally follows federal extensions granted by the IRS. If you receive a federal extension, you generally receive a Massachusetts extension automatically, but you must still pay any estimated Massachusetts tax due by April 15.

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Estimated Tax Payments

If you have income not subject to withholding, quarterly estimated payments are due:

  • Q1: April 15, 2025
  • Q2: June 15, 2025 (Note: June 16, 2025 if June 15 falls on weekend)
  • Q3: September 15, 2025
  • Q4: January 15, 2026

Who must pay estimated tax: You must make estimated payments if you expect to owe at least $400 in Massachusetts tax after subtracting withholding and credits.

Safe harbor provisions: No penalty applies if estimated payments total at least:

  • 80% of current year’s tax liability, OR
  • 100% of prior year’s tax liability (if prior year return covered 12 months)

Forms:

  • Form 1-ES (residents)
  • Form 2-ES (fiduciaries)

Source: https://www.mass.gov/doc/2025-fillable-with-calculator-form-1-es-estimated-tax-payment-vouchers-instructions-and-worksheets/download

Filing Options for Massachusetts Income Tax

Online Filing (E-File)

Electronic filing is available through:

  • MassTaxConnect (official portal): https://www.mass.gov/masstaxconnect
  • IRS-Approved Tax Software: TurboTax, H&R Block, TaxAct, and other software providers that support Massachusetts returns
  • Free File Options: Available for taxpayers who meet income requirements

MassTaxConnect features:

  • File state returns online
  • Make payments
  • Check refund status
  • View filing history
  • Access prior year returns
  • Manage estimated tax payments

Mandatory e-filing:

  • Taxpayers subject to the 4% surtax must file electronically
  • Tax preparers who prepare 10 or more Massachusetts returns must file electronically

Source: https://www.mass.gov/lists/2025-massachusetts-personal-income-tax-forms-and-instructions

Paper Filing

Paper forms are available for download and mail filing:

Primary Forms:

  • Residents: Form 1 – Massachusetts Resident Income Tax Return
  • Non-residents/Part-year residents: Form 1-NR/PY – Massachusetts Nonresident or Part-Year Resident Income Tax Return

Download location: https://www.mass.gov/lists/2025-massachusetts-personal-income-tax-forms-and-instructions

Mailing addresses:

Standard paper returns:

  • With refund or no payment:
    Massachusetts Department of Revenue
    PO Box 7000
    Boston, MA 02204
  • With payment:
    Massachusetts Department of Revenue
    PO Box 7003
    Boston, MA 02204

2D barcode returns (from approved software):

  • With refund or no payment:
    Massachusetts Department of Revenue
    PO Box 7000
    Boston, MA 02204
  • With payment:
    Massachusetts Department of Revenue
    PO Box 7003
    Boston, MA 02204

Important: Do not mail estimated tax payments with your annual return. Use separate vouchers.

Source: https://www.mass.gov/doc/2025-form-1-nrpy-instructions/download

Tax Preparer Options

Licensed tax professionals familiar with Massachusetts tax law include:

  • CPA (Certified Public Accountant)
  • Enrolled Agent (EA)
  • Tax Attorney

Free tax assistance programs:

  • VITA (Volunteer Income Tax Assistance): For taxpayers earning $67,000 or less
  • AARP Tax-Aide: Free tax help for all taxpayers, especially those age 50 and older
  • TCE (Tax Counseling for the Elderly): Free tax assistance for seniors

Find locations: https://www.mass.gov/info-details/massachusetts-personal-income-tax-filing-assistance

Source: https://www.mass.gov/info-details/massachusetts-personal-income-tax-filing-assistance

Local Income Taxes

Massachusetts does not permit local income taxes. Only state-level income tax applies.

All cities and towns in Massachusetts are prohibited from levying local income taxes. This makes Massachusetts one of the simpler states for income tax compliance, as taxpayers only need to file one state return regardless of where they live or work within Massachusetts.

Note: While Massachusetts does not allow local income taxes, cities and towns do levy property taxes, which are separate from income tax.

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Special Considerations for Massachusetts Income Tax

Remote Workers and Multi-State Taxation

Living in Massachusetts, Working for Out-of-State Employer

As a Massachusetts resident, you owe Massachusetts income tax on ALL income, regardless of where your employer is located.

What this means:

  • Employer location does NOT determine tax obligation
  • Income from employers in other states is taxable in Massachusetts
  • You report all worldwide income on your Massachusetts return
  • You are entitled to a credit for taxes paid to other states on income taxed by both states

Example: A Massachusetts resident working remotely for a California company owes Massachusetts income tax on that income. The employer’s California location is irrelevant.

Withholding considerations: If your employer is located outside Massachusetts, they may not withhold Massachusetts tax. You may need to:

  • Request voluntary Massachusetts withholding from your employer, OR
  • Make quarterly estimated tax payments to Massachusetts

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Working in Massachusetts, Living in Another State

Non-residents who perform work IN Massachusetts owe Massachusetts income tax on income earned from Massachusetts sources.

Physical Presence Rule: Income is sourced to Massachusetts based on where work is physically performed, not employer location.

Example: A New Hampshire resident who commutes to Massachusetts for work owes Massachusetts income tax on wages earned while physically working in Massachusetts.

Source: https://www.mass.gov/guides/personal-income-tax-for-nonresidents

⚠️ Interstate Tax Risk Indicator

Remote workers involving Massachusetts commonly encounter dual taxation complications with specific states:

Working with these states requires careful planning:

  • New York – Applies “convenience of employer” rule; may tax remote work income even when work is performed outside NY
  • Connecticut – Non-resident workers must track days worked in CT; complex credit calculations
  • New Hampshire – Has no income tax, but reciprocity lawsuit with Massachusetts created temporary complexity (lawsuit settled in 2021)
  • Pennsylvania – 200+ local income tax jurisdictions create complexity for multi-state arrangements
  • New Jersey – Reciprocity considerations and sourcing rules differ from Massachusetts

Multi-state tax planning considerations:

  • Track days worked in each state carefully
  • Understand each state’s sourcing rules
  • Claim credits for taxes paid to other states on Massachusetts return (Schedule OJC)
  • Consider domicile vs. residency implications

Source: https://www.mass.gov/guides/personal-income-tax-for-nonresidents and https://www.mass.gov/guides/personal-income-tax-for-residents

“Convenience of the Employer” Rule

Massachusetts DOES NOT apply a “convenience of the employer” rule.

Non-residents are taxed only on income from work physically performed in Massachusetts. If you work remotely from another state for a Massachusetts employer, that income is NOT taxable by Massachusetts (it is taxable by your state of residence).

This is a significant advantage for:

  • Massachusetts employers with remote workers in other states
  • Non-residents working remotely for Massachusetts companies

Contrast with other states: States like New York apply the “convenience of employer” rule, under which remote work income may be taxed even when work is performed outside the state. Massachusetts does not follow this approach.

Source: https://www.mass.gov/guides/personal-income-tax-for-nonresidents

Reciprocal Agreements

Massachusetts has NO reciprocal agreements with other states.

This means:

  • Massachusetts residents working in other states must file non-resident returns in those states
  • Non-residents working in Massachusetts must file Massachusetts non-resident returns
  • No exemption certificates are available

Tax credit for taxes paid to other states: Massachusetts residents can claim a credit for income taxes paid to other states on the same income. Use Schedule OJC (Income Tax Due to Other Jurisdictions) to claim this credit.

Example:

  • Massachusetts resident works in Rhode Island
  • Pays Rhode Island income tax on RI wages: $2,000
  • Also owes Massachusetts tax on same wages: $2,500
  • Can claim $2,000 credit on Massachusetts return (Schedule OJC)
  • Net Massachusetts tax due: $500

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Multi-State Tax Filing

When earning income in multiple states:

  1. File a resident return in Massachusetts reporting all income from all sources
  2. File non-resident returns in other states where income was earned
  3. Claim a credit on Massachusetts return for taxes paid to other states (Schedule OJC)

Forms required:

  • Massachusetts Form 1 (residents) or Form 1-NR/PY (part-year residents)
  • Schedule OJC – Income Tax Due to Other Jurisdictions

Credit limitation: The credit cannot exceed the amount of Massachusetts tax attributable to the income that was taxed by both states.

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Tax Residency vs Domicile

Understanding the difference between residency and domicile is critical for determining state tax obligations.

Domicile Defined

Domicile is your permanent legal home – the place where you intend to return and consider “home” indefinitely.

Key characteristics:

  • You can have only ONE domicile at a time
  • Domicile continues until you establish a new domicile elsewhere with intent to remain
  • Intent to return is critical – temporary absences do not change domicile
  • Domicile affects more than taxes (voting rights, in-state tuition, estate administration)

Factors establishing domicile in Massachusetts:

  • Where you maintain your primary residence
  • Where you are registered to vote
  • Where you hold a driver’s license
  • Where your family resides
  • Where you maintain bank accounts and financial ties
  • Where you belong to religious, social, and professional organizations
  • Where you file as a resident for other legal purposes
  • Stated intent in legal documents (wills, trusts)

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Residency Defined

Residency for Massachusetts tax purposes can be established through physical presence even without domicile.

Massachusetts applies a statutory residency rule:

You are a Massachusetts resident for tax purposes if you:

  • Maintain a home in Massachusetts (own or rent), AND
  • Are present in Massachusetts for more than 183 days during the tax year

Important notes:

  • Part of a day counts as a full day for the 183-day test
  • You can be a tax resident of Massachusetts without changing your domicile
  • A person can be a tax resident of multiple states simultaneously

Example of statutory residency:

  • Domicile: Texas (permanent home)
  • Rents apartment in Massachusetts: 8 months (240 days)
  • Result: Massachusetts statutory resident for tax purposes, even though domicile remains in Texas

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Critical Differences
Factor Domicile Tax Residency
Number allowed One at a time Can be resident of multiple states
Based on Intent + connections Physical presence + statutory rules
Changes when Establish new permanent home with intent Meet state's presence threshold
Tax impact May owe tax as domiciliary Owe tax as statutory resident

Common Conflict Scenarios

Scenario 1: Snowbirds

  • Domicile: Massachusetts (permanent home, family, voting)
  • Winter residence: Florida (5 months/year = 150 days)
  • Tax result: Remain Massachusetts resident only (under 183 days in Florida, and Florida has no income tax anyway)

Scenario 2: Extended temporary work assignment

  • Domicile: Massachusetts (permanent home)
  • Work assignment: New York (8 months, rented apartment = 240 days)
  • Tax result: May be New York statutory resident AND Massachusetts domiciliary resident (dual residency)

Scenario 3: College student

  • Domicile: Parents’ home in another state
  • School: Massachusetts (9 months for school)
  • Tax result: Remains non-resident of Massachusetts if presence is temporary for educational purposes with intent to return to home state

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Burden of Proof

If Massachusetts claims you are a resident and you dispute it, the burden of proof typically falls on the taxpayer to demonstrate non-residency.

Common audit triggers:

  • Maintaining Massachusetts driver’s license while claiming residency elsewhere
  • Owning property in Massachusetts while claiming non-residency
  • Family remaining in Massachusetts while taxpayer works elsewhere
  • Day count near 183-day statutory threshold
  • High-income taxpayers claiming non-residency

Documentation to support non-residency claim:

  • Day-count logs showing fewer than 183 days in Massachusetts
  • Evidence of domicile in another state (driver’s license, voter registration, property ownership)
  • Employment records showing work location
  • Utility bills and bank statements from other states

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Multi-State Residency Conflicts

It is possible to be considered a resident of two states simultaneously if each state’s rules independently classify you as resident.

When this happens:

  • File resident returns in both states reporting all income
  • Claim a credit on your domicile state return for taxes paid to the statutory resident state
  • May require professional tax assistance

Example:

  • Domicile: Massachusetts
  • Statutory resident: New York (due to 183+ days presence)
  • File Massachusetts resident return (report all income)
  • File New York resident return (report all income)
  • Claim credit on Massachusetts return (Schedule OJC) for NY taxes paid on the same income

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Documentation Commonly Requested in Residency Audits

Massachusetts Department of Revenue may audit residency determinations. The following documentation types are commonly requested:

Primary Residency Evidence
Document Type What It Shows
Driver's License State of legal residence
Voter Registration Where you exercise voting rights
Vehicle Registration Where vehicles are domiciled
Professional Licenses State of professional domicile
Homestead Declaration Primary residence claim
Physical Presence Documentation
Document Type What It Shows
Day-Count Logs Physical location by day (critical for 183-day test)
Travel Records Interstate travel patterns
Credit Card Statements Geographic spending patterns
Cell Phone Records Location data from carrier
E-ZPass / Toll Records State line crossings
Work schedules / timesheets Where work was performed
Property and Financial Ties
Document Type What It Shows
Property Ownership Real estate holdings
Homestead Exemption Primary residence claim
Utility Bills Physical occupancy patterns
Home/Rental Lease Residence location
Bank Statements Financial institution location
Mortgage statements Property ownership and location
Social and Family Connections
Document Type What It Shows
Family Location Where spouse/children reside
Medical Records Where you receive regular care
Religious Affiliation Place of worship attendance
Club Memberships Social/recreational ties
Children's school records Where family is established
Employment Documentation
Document Type What It Shows
W-2 Forms Employer location, wages
Employment Contract Work location requirements
Remote Work Agreement Authorization to work remotely
Payroll records Where services were performed
Intent Documentation
Document Type What It Shows
Will/Estate Documents Stated domicile for estate purposes
Tax Returns Prior year residency claims
Insurance Policies Address on file with insurers
Legal filings Claimed residence in legal proceedings

Massachusetts-Specific Audit Triggers

Common patterns that trigger Massachusetts residency audits:

  • Claiming non-residency while maintaining Massachusetts driver’s license
  • Owning property in Massachusetts while filing as non-resident
  • Spouse/children residing in Massachusetts while taxpayer claims other domicile
  • High-income individuals claiming non-residency (especially after 4% surtax implementation)
  • Day count near 183-day statutory threshold
  • Inconsistent residency claims across different government filings

Burden of Proof: In residency disputes, the burden typically falls on the taxpayer to prove non-residency or domicile elsewhere.

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Note: This section provides factual information about documentation types commonly requested. It does not constitute legal or tax advice.

Military Personnel

Servicemembers Civil Relief Act (SCRA)

Active duty military members stationed in Massachusetts due to military orders:

  • Do NOT become Massachusetts residents solely due to military orders
  • Pay income tax to their state of legal residence (domicile)
  • Are not subject to Massachusetts income tax on military pay

Key principle: Military orders do not change legal domicile. A servicemember remains a resident of their home state unless they take affirmative steps to establish a new domicile.

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Military Spouses Residency Relief Act (MSRRA)

Spouses of active duty military can maintain their home state residency and are not taxed by Massachusetts on income earned in Massachusetts if:

  • Spouse is in Massachusetts solely to be with the servicemember
  • Servicemember is in Massachusetts under military orders
  • Spouse maintains domicile in another state

What this means: A military spouse does not become a Massachusetts resident just because they move to Massachusetts to be with a servicemember. They can continue to file as a resident of their home state.

Withholding exemption: Military spouses who qualify under MSRRA should file Form M-4-MS with their employer to be exempt from Massachusetts withholding.

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Military Retirement Pay

Massachusetts fully exempts military retirement pay from state income tax.

Applies to:

  • U.S. Armed Forces retirement pay
  • Reserve retirement pay
  • National Guard retirement pay

No age limitation: The exemption applies regardless of the retiree’s age.

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

What Military Members DO Owe Tax On

Military members who ARE Massachusetts residents (domicile in Massachusetts) owe Massachusetts income tax on:

  • Non-military income earned in Massachusetts or elsewhere
  • Investment income (interest, dividends, capital gains)
  • Rental income from Massachusetts property
  • Business income
  • Spouse’s income (unless spouse qualifies under MSRRA)

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Retirees

Social Security Benefits

Massachusetts does not tax Social Security benefits.

This exemption includes:

  • Retirement benefits
  • Disability benefits
  • Survivor benefits

All Social Security income is fully excluded from Massachusetts taxation.

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Pension Income

Public Pensions (fully exempt): Massachusetts does not tax:

  • Massachusetts state employee pensions
  • Massachusetts municipal employee pensions
  • U.S. government pensions (federal civilian employees)
  • Military retirement pay
  • Pensions from other states’ governments (if the retiree was employed by that state or its political subdivisions)

Private Pensions (fully taxable): Massachusetts taxes:

  • Private employer pension plans
  • Private sector retirement benefits
  • Pension income from non-governmental employers

No exemption available for private pension income based on age or other factors.

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Retirement Account Distributions

401(k) and Traditional IRA: Massachusetts taxes distributions from traditional 401(k) plans and traditional IRAs as ordinary income at the 5.0% rate (plus 4% surtax if total income exceeds threshold).

Roth IRA and Roth 401(k): Massachusetts does not tax qualified distributions from Roth accounts. This follows federal treatment.

Early withdrawal penalties: If you withdraw from retirement accounts before age 59½, you may owe federal penalties, but Massachusetts does not impose additional state penalties.

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Tax Benefits for Seniors

Senior Circuit Breaker Credit: Seniors age 65 and older may qualify for a refundable credit of up to $2,820 (2025 limit) based on property taxes or rent paid. See the Tax Credits section for full details.

Additional exemptions:

  • Additional $700 exemption for taxpayers age 65 or older
  • Additional $2,200 exemption if blind

Source: https://www.mass.gov/info-details/massachusetts-senior-circuit-breaker-tax-credit

Students

College students attending school in Massachusetts do NOT automatically become residents for tax purposes.

You remain a non-resident if:

  • You maintain legal residence (domicile) in another state
  • Your presence in Massachusetts is temporary for educational purposes
  • You intend to return to your home state after graduation

Example: A student from California attending Boston University for four years does not become a Massachusetts resident if they maintain California as their legal domicile and intend to return to California after graduation.

Source: https://www.mass.gov/guides/personal-income-tax-for-nonresidents

What Students Owe Tax On

Non-resident students owe Massachusetts tax only on Massachusetts-source income:

  • Wages earned from working in Massachusetts (on-campus jobs, internships, part-time employment)
  • Income from services performed in Massachusetts
  • Business income from Massachusetts operations

Not taxable by Massachusetts:

  • Scholarships and fellowships used for qualified educational expenses
  • Student loans
  • Parental support
  • Savings and investments held in other states

Source: https://www.mass.gov/guides/personal-income-tax-for-nonresidents

Establishing Massachusetts Residency as a Student

Students CAN become Massachusetts residents if they take affirmative steps to establish domicile:

Actions that may establish Massachusetts domicile:

  • Register to vote in Massachusetts
  • Obtain Massachusetts driver’s license
  • Purchase property in Massachusetts
  • Obtain Massachusetts vehicle registration
  • Declare intent to remain in Massachusetts permanently
  • Maintain continuous presence beyond educational purposes (e.g., staying to work after graduation)

Important: Simply attending school in Massachusetts, even for multiple years, does not by itself establish Massachusetts residency.

Source: https://www.mass.gov/guides/personal-income-tax-for-nonresidents

Filing Requirements for Students

Non-resident students must file Form 1-NR/PY if:

  • Massachusetts source income exceeds $8,000, OR
  • Massachusetts source income exceeds the prorated personal exemption (whichever is less)

Resident students must file Form 1 if:

  • Massachusetts gross income exceeds $8,000

Students claiming full-time student exemption: Full-time students whose annual income will not exceed $8,000 can claim exemption from Massachusetts withholding by notifying their employer. This does not eliminate filing requirements if income exceeds thresholds.

Source: https://www.mass.gov/guides/personal-income-tax-for-nonresidents

Part-Year Residents

If you moved TO or FROM Massachusetts during 2025, state law requires filing as a part-year resident.

Income Allocation

Part-year residents are taxed on:

  • All income earned while a Massachusetts resident (regardless of source)
  • Income from Massachusetts sources earned while a non-resident

Income to exclude:

  • Income earned while a resident of another state (except Massachusetts-source income)

Proration of exemptions and deductions: Personal exemptions and certain deductions are prorated based on the number of days you were a Massachusetts resident divided by 365.

Source: https://www.mass.gov/guides/personal-income-tax-for-part-year-residents

Moving TO Massachusetts

Steps:

  1. Determine your Massachusetts residency start date (the day you establish domicile in Massachusetts)
  2. Report all income from that date forward on your Massachusetts return
  3. File a non-resident return (or part-year resident return) in your former state for income earned before moving

Example:

  • Moved to Massachusetts: July 1, 2025 (184 days as resident)
  • Salary earned before moving: $50,000 (New York)
  • Salary earned after moving: $60,000 (Massachusetts)
  • File Massachusetts part-year return reporting $60,000 Massachusetts income
  • File New York part-year return reporting $50,000 New York income
  • Prorate exemptions: (184 ÷ 365) × total exemptions

Source: https://www.mass.gov/guides/personal-income-tax-for-part-year-residents

Moving FROM Massachusetts

Steps:

  1. Determine your Massachusetts residency end date (the day you establish domicile elsewhere)
  2. Report all income through that date on your Massachusetts return
  3. File a non-resident or part-year resident return in your new state

Example:

  • Moved from Massachusetts: September 15, 2025 (259 days as resident)
  • Salary earned while Massachusetts resident: $70,000
  • Salary earned after moving: $25,000 (Texas)
  • File Massachusetts part-year return reporting $70,000 income
  • Texas has no income tax, so no Texas return required
  • Prorate exemptions: (259 ÷ 365) × total exemptions

Source: https://www.mass.gov/guides/personal-income-tax-for-part-year-residents

Form Required

Form 1-NR/PY – Massachusetts Nonresident or Part-Year Resident Income Tax Return

This single form is used for both non-residents and part-year residents. Complete the appropriate sections based on your residency status.

Key schedules:

  • Schedule R/NR: Used to calculate the allocation of income, deductions, and exemptions

Source: https://www.mass.gov/lists/2025-massachusetts-personal-income-tax-forms-and-instructions

Common Tax Filing Situations

These are factual clarifications based on official Massachusetts guidance and tax law.

Situation: “My employer is in another state, so I don’t owe Massachusetts tax”

Massachusetts law: Massachusetts residents owe tax on all income regardless of employer location. Employer location does not determine tax obligation. Residency determines tax obligation.

If you are a Massachusetts resident, you owe Massachusetts tax on income earned in all states and countries. You may claim a credit for taxes paid to other states on the same income.

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Situation: “I work remotely full-time, so I don’t owe tax anywhere”

Tax law principle: All income is taxable in at least one jurisdiction. Remote work does not exempt income from taxation.

As a Massachusetts resident working remotely, you owe Massachusetts tax on your remote work income. If you physically perform work in another state, that state may also tax your income, and you would claim a credit on your Massachusetts return.

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Situation: “I’m a part-year resident, so I owe half the tax”

Massachusetts law: Part-year residents owe tax only on income earned during the Massachusetts residency period, not a simple 50% reduction.

Tax is calculated based on actual income earned while a resident, with exemptions prorated based on days of residency. This is not a simple percentage reduction.

Source: https://www.mass.gov/guides/personal-income-tax-for-part-year-residents

Situation: “I maintain a home in Massachusetts but live there fewer than 183 days, so I’m not a resident”

Massachusetts law: If Massachusetts is your domicile (permanent home), you are a resident regardless of how many days you spend there.

The 183-day rule makes you a statutory resident if you maintain a home AND are present more than 183 days. But if Massachusetts is your domicile, you’re a resident even if present fewer than 183 days.

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Situation: “I’m a nonresident of Massachusetts, so I don’t need to file a return”

Massachusetts law: Nonresidents with Massachusetts-source income exceeding $8,000 (or the prorated personal exemption, whichever is less) must file a Massachusetts return.

If you worked in Massachusetts, had rental income from Massachusetts property, or received income from a Massachusetts business, you likely need to file.

Source: https://www.mass.gov/guides/personal-income-tax-for-nonresidents

Situation: “Massachusetts has no local income tax, so I only file one return”

Correct: Massachusetts does not permit local income taxes. You file only one state return, regardless of which city or town you live or work in within Massachusetts.

However, if you earn income in other states, you may need to file non-resident returns in those states.

Source: https://www.mass.gov/guides/personal-income-tax-for-residents

Situation: “I’m subject to the 4% surtax, so I can’t e-file”

Massachusetts law: Taxpayers subject to the 4% surtax MUST file electronically. Paper filing is not permitted for surtax filers.

If your taxable income exceeds $1,083,150 (2025 threshold), you must file using MassTaxConnect or approved tax software.

Source: https://www.mass.gov/info-details/massachusetts-4-surtax-on-taxable-income

Situation: “I lived in Massachusetts for 6 months, so I pay Massachusetts tax on 50% of my income”

Massachusetts law: Part-year residents pay Massachusetts tax on ALL income earned during the period of Massachusetts residency, not 50% of all income.

The calculation is based on when income was earned, not on a simple percentage of the year.

Source: https://www.mass.gov/guides/personal-income-tax-for-part-year-residents

Forms & Publications

Primary Tax Return Forms

Resident return:

Non-resident/part-year return:

Source: https://www.mass.gov/lists/2025-massachusetts-personal-income-tax-forms-and-instructions

Common Schedules

  • Schedule B: Interest, Dividends and Certain Capital Gains and Losses
  • Schedule D: Capital Gains and Losses
  • Schedule HC: Health Care Information (Massachusetts individual mandate)
  • Schedule X: Other Income
  • Schedule Y: Other Deductions
  • Schedule DI: Dependent Information
  • Schedule OJC: Income Tax Due to Other Jurisdictions (credit for taxes paid to other states)
  • Schedule CB: Circuit Breaker Credit (for seniors age 65+)
  • Schedule SC: Septic Credit for Repairing or Replacing a Failed Cesspool or Septic System
  • Schedule 4% Surtax: Calculation of 4% surtax on high-income taxpayers
  • Schedule R/NR: Resident/Nonresident Worksheet

Source: https://www.mass.gov/lists/2025-massachusetts-personal-income-tax-forms-and-instructions

Withholding Forms

  • Form M-4: Massachusetts Employee’s Withholding Exemption Certificate (equivalent to federal W-4)
  • Form M-4-MS: Military Spouse Withholding Exemption Certificate
  • Circular M: Withholding tables and employer guidance

Withholding rates:

  • 5.0% on regular wages
  • 9.0% on supplemental wages over $1,083,150 combined with regular wages

Source: https://www.mass.gov/doc/massachusetts-circular-m-income-tax-withholding-tables-at-50-effective-january-1-2025/download

Estimated Tax Forms

Individuals:

Fiduciaries:

Source: https://www.mass.gov/lists/2025-massachusetts-personal-income-tax-forms-and-instructions

Extension and Payment Forms

  • Form M-4868: Massachusetts Income Tax Extension Payment Worksheet and Voucher
  • Form PV: Massachusetts Income Tax Payment Voucher
  • Form M-2210: Underpayment of Massachusetts Estimated Income Tax

Source: https://www.mass.gov/lists/2025-massachusetts-personal-income-tax-forms-and-instructions

Other Important Forms

  • Form ABT: Application for Abatement (for requesting refund or correction after assessment)
  • Form 84: Application for Relief from Joint Income Tax Liability (innocent spouse relief)
  • Form M-1310: Statement of Claimant to Refund Due a Deceased Taxpayer
  • Schedule TDS: Taxpayer Disclosure Statement
  • Form M-8453: Individual Income Tax Declaration for Electronic Filing

Source: https://www.mass.gov/lists/2025-massachusetts-personal-income-tax-forms-and-instructions

Where to Submit Paper Returns

With refund or no payment: Massachusetts Department of Revenue
PO Box 7000
Boston, MA 02204

With payment: Massachusetts Department of Revenue
PO Box 7003
Boston, MA 02204

For 2D barcode returns (generated by approved software): Use the same addresses as above based on whether you have a payment.

For estimated tax payments: Massachusetts Department of Revenue
PO Box 419540
Boston, MA 02241-9540

Source: https://www.mass.gov/doc/2025-form-1-nrpy-instructions/download

Penalties and Interest

Late Filing Penalty

Massachusetts imposes a penalty of 1% per month (up to 25% maximum) on unpaid tax if a return is filed late.

Penalty calculation:

  • 1% of the unpaid tax for each month (or part of a month) the return is late
  • Maximum penalty: 25% of the unpaid tax
  • Minimum penalty: $25 (if any tax is due)

Source: Massachusetts General Laws Chapter 62C, § 33

Late Payment Penalty

Massachusetts imposes a penalty of 1% per month (up to 25% maximum) on unpaid tax if payment is late.

Important distinction:

  • You can file on time but pay late (late payment penalty only)
  • You can file late and pay late (both penalties may apply)
  • Filing an extension eliminates late filing penalty IF you pay at least 80% of tax due by April 15

Source: Massachusetts General Laws Chapter 62C, § 33

Interest on Unpaid Tax

Interest accrues on unpaid tax from the original due date until paid in full.

Interest rate: The interest rate is set annually based on the federal short-term rate plus 2 percentage points, with adjustments made quarterly if needed.

Current rate: Approximately 6% annually (rate varies; check DOR website for current rate)

Interest compounds daily and is not deductible on federal or state returns.

Source: https://www.mass.gov/info-details/massachusetts-tax-rates

Underpayment of Estimated Tax Penalty

If you have income not subject to withholding and do not pay sufficient estimated tax, you may owe an underpayment penalty.

Penalty avoidance – safe harbors: No penalty applies if:

  • Total tax after credits is less than $400, OR
  • You paid at least 80% of current year’s tax liability through withholding and estimated payments, OR
  • You paid at least 100% of prior year’s tax liability through withholding and estimated payments (if prior year covered 12 months)

Calculation: Use Form M-2210 to calculate underpayment penalty. The penalty is similar to interest on the underpaid amount for each quarter.

Source: https://www.mass.gov/doc/2025-form-m-2210-underpayment-of-massachusetts-estimated-income-tax/download

Penalty Waivers

Massachusetts DOR may waive penalties (but not interest) in cases of:

  • Reasonable cause
  • Circumstances beyond your control
  • First-time penalty situations (in some cases)

How to request waiver: Submit a written explanation with your return or in response to a penalty notice, explaining the circumstances that prevented timely filing or payment.

Important: Interest cannot be waived except in very limited circumstances (e.g., DOR error).

Source: Massachusetts General Laws Chapter 62C, § 33

Accuracy-Related Penalties

Additional penalties may apply for:

  • Substantial understatement of tax (20% penalty)
  • Negligence or intentional disregard of rules (20% penalty)
  • Fraud (intent to evade tax) (50% penalty)

These penalties are separate from late filing and late payment penalties and can apply even if you file and pay on time.

Source: Massachusetts General Laws Chapter 62C, § 26 and § 28

Information Verification Log

Information Sources
Information Type Source Last Verified
Tax rates and 4% surtax threshold mass.gov – Massachusetts tax rates February 12, 2026
Personal exemption amounts Form 1-NRPY Instructions February 12, 2026
Tax credits (EITC, Child and Family, Circuit Breaker) Massachusetts Tax Credits Overview February 12, 2026
Filing requirements and deadlines Personal Income Tax for Residents February 12, 2026
Capital gains tax rates Capital Gains – MA DOR February 12, 2026
Forms and publications 2025 MA Income Tax Forms February 12, 2026
Withholding tables Massachusetts Circular M February 12, 2026

Official Massachusetts Income Tax Resources

All information on this page is compiled exclusively from official government sources.

Massachusetts Department of Revenue

Massachusetts Tax Code and Regulations

Contact Information

Massachusetts Department of Revenue Customer Service:

  • Phone: (617) 887-6367 or toll-free in Massachusetts: (800) 392-6089
  • Hours: Monday-Friday, 9:00 AM – 4:00 PM ET
  • Address:
    Massachusetts Department of Revenue
    PO Box 7010
    Boston, MA 02204

Note: DOR does not provide email support for general tax questions. Use phone or mail for inquiries.

Taxpayer Advocate

Office of the Taxpayer Advocate: Provides assistance to taxpayers who have been unable to resolve issues through normal DOR channels.

Free Tax Assistance

VITA (Volunteer Income Tax Assistance): Free tax help for taxpayers earning $67,000 or less
Find locations: https://www.mass.gov/info-details/massachusetts-personal-income-tax-filing-assistance

AARP Tax-Aide: Free tax assistance for all taxpayers, especially age 50+
Find locations: https://www.aarp.org/money/taxes/aarp_taxaide/ or call (888) 227-7669

TCE (Tax Counseling for the Elderly): Free tax assistance for seniors
Find locations: https://www.irs.gov/individuals/find-a-location-for-free-tax-prep

Where to Check for Updates

Current Tax Rate Tables: https://www.mass.gov/info-details/massachusetts-tax-rates
Updated annually; 4% surtax threshold certified in November/December of prior year

Forms Library: https://www.mass.gov/lists/2025-massachusetts-personal-income-tax-forms-and-instructions
Forms typically available starting late December/early January

Legislative Changes:

Administrative Guidance:

Taxpayer Notices and Announcements:

Email Subscription: Massachusetts does not currently offer a formal email subscription service for tax updates. Check the DOR website regularly for updates.

Social Media: Massachusetts DOR maintains limited social media presence. The official website is the most reliable source for updates.

Note: This page will be reviewed and updated in January 2027 for Tax Year 2026. For real-time updates, always consult the official Massachusetts Department of Revenue website at https://www.mass.gov/dor

Tax Glossary

Adjusted Gross Income (AGI): Massachusetts Adjusted Gross Income is your gross income minus certain allowable deductions (such as student loan interest, alimony paid, and certain business expenses). AGI is used to determine eligibility for credits and to calculate taxable income.

Taxable Income: Your Massachusetts AGI minus your personal exemptions. This is the amount on which your tax is calculated.

Resident: An individual whose domicile is in Massachusetts, or who maintains a home in Massachusetts and is present in the state for more than 183 days during the tax year.

Non-Resident: An individual who is neither a full-year nor part-year resident but who has Massachusetts-source income.

Part-Year Resident: An individual who moves into or out of Massachusetts during the tax year and establishes or abandons domicile.

Domicile: Your permanent legal home – the place you intend to return to and consider your fixed, permanent home.

Massachusetts-Source Income: Income derived from Massachusetts sources, including wages for work performed in Massachusetts, business income from Massachusetts operations, and rental income from Massachusetts property.

Withholding: Tax deducted from your paycheck by your employer and remitted to Massachusetts on your behalf.

Reciprocity: An agreement between states where residents pay tax only to their state of residence. Massachusetts has NO reciprocal agreements with any other states.

Tax Credit: A dollar-for-dollar reduction in tax owed (e.g., a $500 credit reduces tax by $500).

Personal Exemption: A fixed dollar amount that reduces taxable income based on filing status, dependents, age, and blindness. Massachusetts uses personal exemptions instead of a standard deduction.

Filing Status: Category determining personal exemption amounts (Single, Married Filing Jointly, Married Filing Separately, Head of Household).

4% Surtax: An additional 4% tax imposed on taxable income exceeding $1,083,150 (2025 threshold). The threshold adjusts annually for inflation.

Statutory Resident: An individual who meets the 183-day presence test (maintains a home in Massachusetts and is present more than 183 days) but whose domicile may be elsewhere.

Schedule OJC: Schedule used to claim a credit for income taxes paid to other jurisdictions on income also taxed by Massachusetts.

MassTaxConnect: Massachusetts Department of Revenue’s online portal for filing returns, making payments, and managing tax accounts.

Update History

This section documents all material changes to Massachusetts income tax information on this page.

February 2026 – Initial Publication

  • Published comprehensive Massachusetts income tax guide for Tax Year 2025
  • Documented 5.0% flat rate with 4% surtax on income over $1,083,150
  • Verified all tax rates, credits, and exemptions from official DOR sources
  • Confirmed elimination of Massachusetts bank interest exemption (effective 2024)
  • Updated EITC to 40% of federal credit
  • Updated Child and Family Tax Credit to $440 per qualifying individual
  • Updated Circuit Breaker maximum credit to $2,820
  • Updated personal exemption amounts
  • Source: Massachusetts DOR forms and guidance published December 2024 – January 2026

4% Surtax Threshold Certification:

  • 2025 threshold: $1,083,150 (certified November 2024)
  • 2024 threshold: $1,062,150
  • 2023 threshold: $1,000,000 (first year)
  • Source: Massachusetts DOR Surtax Threshold Certification

Tax Law Changes Implemented:

  • Repeal of Massachusetts bank interest exemption (effective January 1, 2024)
  • Sales factor-only apportionment for businesses (effective January 1, 2025)
  • Mandatory joint filing for married couples filing federal joint return (with exceptions) – effective tax year 2024

Verification Schedule:

  • Annual Update: January (new tax rates, surtax threshold, credit amounts)
  • Mid-Year Review: June (legislative changes)
  • Continuous Monitoring: Emergency tax legislation, TIRs, DOR directives
  • Source Link Check: Quarterly (all .gov URLs verified functional)

Last comprehensive update: February 12, 2026
Next scheduled review: January 2027 (for Tax Year 2026 rates and forms)

Others

California
New York
Texas
Pennsylvania
Florida
New Jersey
Illinois
Ohio

Legal Disclaimer: Nature of This Compilation This document is a compilation of publicly available information from official government sources. It is NOT: Legal advice An interpretation of laws or regulations A substitute for consultation with a licensed attorney A comprehensive treatment of all applicable laws Guaranteed to be complete or current