If you earned less than $8,000 during the 2023 tax year, you don’t have to file a Massachusetts tax return. However, you may choose to do so if you want to claim certain tax credits, such as the earned income tax credit. Money withdrawn from most private pensions and retirement accounts, including 401(k)s and traditional IRAs, is considered taxable income.

Massachusetts Tax Tables – Tax Rates and Thresholds in Massachusetts

Massachusetts exemptions are $4,400 for single filers, $6,800 for head of household and $8,800 for married joint filers. If your state tax witholdings are greater then the amount of income tax you owe the state of Massachusetts, you will receive an income tax refund check from the government to make up the difference. As the senior tax editor at Kiplinger.com, Kelley R. Taylor simplifies federal and state tax information, news, and developments to help empower readers. Kelley has over two decades of experience advising on and covering education, law, finance, and tax as a corporate attorney and business journalist.

for Credits

Massachusetts has some of the highest cigarette taxes in the nation. The tax is $3.51 per pack of 20, which puts the average price of cigarettes in Massachusetts at around $9 per pack. If you commute to work, you can deduct certain transportation costs such as tolls paid through an E-Z Pass MA account and the costs of weekly or monthly passes to the Massachusetts public transit system. There are two ways to be considered a full-time resident of Massachusetts. The first is to live in Massachusetts for the entire tax year, while the second is to maintain a home in Massachusetts and spend more than 183 days of the tax year in the state.

Massachusetts — Single Tax Brackets

For purposes of this article, we’ll be focusing on “ordinary income,” which is the income that you earn from work or from your small business, as well as rental income, interest, royalties, and retirement income. Think of ordinary income as the money you earn day in and day out. Boston Harbor may be the site of the most famous tax protest in history, but today Bay Staters pay taxes on a lot more than tea. The most significant taxes in Massachusetts Accounting For Architects are the sales and income taxes, both of which consist of a flat rate paid by residents statewide.

Next, check what income you included in your Massachusetts gross income that you’re supposed to deduct on the appropriate Schedule, and then deduct the income. We’ve built a platform to give everyone access to the tax and wealth-building tools typically reserved for wealthy individuals with a team of accountants and lawyers. We make it simple and seamless for our customers to take advantage of these hard-to-access tax-advantaged structures.

• However, you may choose to do so if you want to claim certain tax credits, such as the earned income tax credit.
• You can claim $1,000 or 15% of the net expenditure for the renewable energy source property, whichever is less.
• It states that the real and personal property taxes imposed by a city or town may only grow each year by 2.5% of the prior year’s levy limit, plus new growth and any overrides or exclusions.
• Massachusetts has its own estate tax, which applies to any estate above the exclusion amount of $2 million.
• 5.00% For wages exceeding $1,053,750, there is an additional surtax of 4%.
• Use tax is a 6.25% tax paid on out-of-state or out-of-country purchases that are used, stored or consumed in Massachusetts and on which no Massachusetts sales tax (or less than 6.25%) was paid.

The greatest dollar increase from FY2024 in a commercial tax rate is Sandisfield ($4.69), while the greatest dollar decrease is Needham ($3.66). Here you can find how your accounting Massachusetts is based on a flat tax rate. When you prepare your return on eFile.com this is all calculated for you based on your income.

Federal Deductions Not Allowed on Massachusetts Schedule Y

• If you’re a full-year resident with an annual Massachusetts gross income of more than $8,000, you must file a Massachusetts tax return.
• If you commute to work, you can deduct certain transportation costs such as tolls paid through an E-Z Pass MA account and the costs of weekly or monthly passes to the Massachusetts public transit system.
• Unlike the 6.25% sales tax, which is collected by sellers, use tax is generally paid directly to the state by the purchaser.
• If you need assistance, please contact the Division of Local Services.
• Unlike other states, Massachusetts does not have a state standard deduction.
• Failure to obtain the appropriate licenses can result in fines or business closure.

We believe everyone should be able to make financial decisions with confidence. Let us know in a single click, and we’ll fix it as soon as possible. While we take all precautions to ensure that the data on this site is correct and up-to-date, we cannot be held liable for the accuracy of the tax data we present. If you need assistance, please contact the Massachusetts Department of Revenue.

• There is no limit to the number of such individuals that may qualify for the credit.
• Complete and e-File your Massachusetts Income Tax Return on eFile.com along your Federal Tax Return.
• Let’s consider an individual who has a taxable income of $350,000 in Massachusetts state.
• Moreover, Massachusetts also has a standard deduction that is $4,400 for single filers, and $$8,800 for married filing jointly.
• Anyone who files a Massachusetts state tax return is given a personal exemption amount based on their tax filing status.

Veterans Administration disability compensation is also not taxed in the state.Spouses of military personnel may be eligible for exemptions. Use tax is a 6.25% tax paid on out-of-state or out-of-country purchases that are used, stored or consumed in Massachusetts and on which no Massachusetts sales tax (or less than 6.25%) was paid. View more detailed information on filing status to see what this means for you. If an extension payment is required to reach the 80% threshold, you can pay electronically. If you need to pay $5,000 or more to qualify for an extension, you are required pay electronically.

You can choose another state to calculate both state and federal income tax here. Massachusetts has massachusetts tax brackets its own estate tax, which applies to any estate above the exclusion amount of $2 million. If the estate has a gross value (before any deductions) over that level, a Massachusetts estate tax return must be filed.