Massachusetts Tax Rates, Standard Deductions, Forms, and More

TurboTax simplifies the process, whether you want to do your taxes yourself or get expert help. Let’s consider an individual who has a taxable income of $350,000 in Massachusetts state. This individual would qualify for the $4,400 standard deduction, reducing his or her taxable income to $345,600, putting them in the 9% tax bracket. Massachusetts, like the federal government, uses a progressive tax system, which means that different portions of the individual’s income are taxed at the different rates corresponding to the brackets they fall into. We’ll explore the specifics of Massachusetts’s income tax shortly.

Massachusetts State Taxes: What You’ll Pay in 2025

For most taxpayers, Massachusetts has a flat income tax of 5 percent. In November 2022, Bay State voters approved an additional 4 percent tax on annual income above $1 million, beginning in tax year 2023. Annual income above $1 million (adjusted annually for inflation) is taxed at 9 percent.A personal income tax exemption allows for a subtraction from gross income. Accordingly, it’s critical to identify strategies that can reduce this tax. Tax planning is a strategic approach designed to reduce a person’s (or a company’s) tax liability by leveraging various tax benefits and allowances. It’s about understanding the tax implications of your financial decisions, so you can minimize your taxes and, ultimately, keep more of your hard-earned money.

Massachusetts Standard and Itemized Deductions

View how much tax you may pay in other states based on the filing status and state entered above. The state extension deadline follows the federal extension deadline set by the IRS, which is Oct. 15, 2025. Keep in mind that being granted a federal tax extension does not grant you a state tax extension in Massachusetts.

• The average property tax rate in Massachusetts is 1.04 percent, according to the Tax Foundation.Learn more about property tax in Massachusetts.
• While most in-depth tax software charges a fee, there are several free options available through the states, and simple versions are also offered free of charge by most tax software companies.
• 1001 was adopted, further reducing the top marginal rate to 3.9 percent, retroactively effective as of January 1, 2024.
• But dollars below that amount will be taxed at the rate corresponding to the brackets they fall into.
• Certain short-term capital gains are taxed at a rate of 8.5% and long-term capital gains from the sale of collectibles are taxed at a rate of 12%.
• Massachusetts has two marginal tax brackets, ranging from 5% (the lowest Massachusetts tax bracket) to 9% (the highest Massachusetts tax bracket).

Massachusetts Tax Tables 2025 – Tax Rates and Thresholds in Massachusetts

If the estate has a gross value (before any deductions) over that level, a Massachusetts estate tax return must be filed. Money withdrawn from most private pensions and retirement accounts, including 401(k)s and traditional IRAs, is considered taxable income. Check the Massachusetts Form 1-NR/PY to learn more.AARP’s Retirement Calculator can help you determine if you are saving enough to retire when — and how — you want. Anyone earning over $8,000 in Massachusetts annual gross income is required to file a state tax return. Those earning less than this amount do not contribution margin need to file a return, but they can still file a return to claim refundable tax credits.

for Filing Requirements

• The standard deduction, which Massachusetts does not have, is a deduction that is available by default to all taxpayers who do not instead choose to file an itemized deduction.
• Massachusetts’s tax system ranks 41st overall on the 2025 State Tax Competitiveness Index.
• It was nearly doubled for all classes of filers by the 2017 Tax Cuts and Jobs Act (TCJA) as an incentive for taxpayers not to itemize deductions when filing their federal income taxes.
• Massachusetts’s flat tax rate should make filing your state income tax return easy, but residency rules, deductions, and credits can sometimes complicate the process.
• Some states double their single-filer bracket widths for married filers to avoid imposing a “marriage penaltyA marriage penalty is when a household’s overall tax bill increases due to a couple marrying and filing taxes jointly.
• If you’re a nonresident with an annual Massachusetts gross income of more than either $8,000 or the prorated personal exemption, whichever is less, you must file a Massachusetts tax return.

You can save time and money by electronically filing your Massachusetts income tax directly with Accounting for Churches the . Benefits of e-Filing your Massachusetts tax return include instant submission, error checking, and faster refund response times. Most tax preparers can electronically file your return for you, or you can do it yourself using free or paid income tax software, like the examples listed below. The mechanism of FICA taxation involves a dual contribution system where both the employer and the employee contribute a set percentage of the employee’s income towards these programs. The tax is applied to wages, salaries, and other compensation within certain thresholds, which are adjusted periodically.

• Numerous tax changes took effect in Kansas as a result of Senate Bill 1, enacted in June 2024.
• The EITC rates and thresholds are adjusted annually to reflect changes in the economy and cost of living.
• The Federal Income Tax, by contrast, has different tax brackets for Single, Married Filing Jointly, and Head of Household taxpayers.
• Contact your city or town to see if they participate.View tax tips for seniors and retirees in Massachusetts.
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When you prepare your return on eFile.com this is all calculated for you based on your income. As of January 1, 2025, New Hampshire repealed its interest and dividends tax, joining the group of seven other states with no individual income tax. Many policies, such as minimum wage levels, tax brackets, and means-tested public benefit income thresholds, are denominated in nominal dollars, even though a dollar in one region may go much further than a dollar in another.