2022-2023 Tax Brackets and Federal Income Tax Rates


what is massachusetts income tax rate

Massachusetts has a graduated  individual income tax, with rates ranging from 5.00 to 9.00 percent. Massachusetts has a 6.25 percent state sales tax rate and does not levy local sales taxes. Massachusetts’s tax system ranks 34th overall on our 2023 State Business Tax Climate Index. Most states impose a tax on income of corporations having sufficient connection (“nexus”) with the state. Such taxes apply to U.S. and foreign corporations, and are not subject to tax treaties. Such tax is generally based on business income of the corporation apportioned to the state plus nonbusiness income only of resident corporations.

For e-filed returns the turnaround time is about 6 weeks; but for paper returns it could take up to 10 weeks. You must claim your refund or credit within a certain time period, as further detailed below. Also, the Department of Revenue must issue refunds within a certain time period or pay interest on the amount of the refund.

tax brackets (for taxes due April 2023 or October 2023 with an extension)

Most food sold in grocery stores is exempt from sales tax entirely. Clothing purchases, including shoes, jackets and even costumes, are exempt up to $175. A product that costs more than $175 is taxable above that amount, so a $200 pair of shoes would be taxed at 6.25% on the $25 above the exemption limit. Other exempt items include newspapers, admissions tickets (i.e. to movies or sporting events), professional or personal services and most health care products. Massachusetts doesn’t collect sales tax on purchases of most prescription drugs and groceries.

  • Most states impose a tax on income of corporations having sufficient connection (“nexus”) with the state.
  • Then, you will upload your tax documents, and our tax pros will do the rest!
  • If you’re married filing joint, both spouses must sign the return.
  • Massachusetts has some of the highest cigarette taxes in the nation.
  • This extension covers filing tax returns, paying tax (including estimated tax), and filing tax extension forms with us.
  • Outstanding amounts must receive confirmation of good standing from the Treasurer/Collector’s Office prior to issuance.
  • Of all alcoholic beverages subject to taxation, stiff drinks—and all distilled spirits—face the stiffest tax rates.

Massachusetts has its own estate tax, which applies to any estate above the exclusion amount of $1 million. If the estate has a gross value (before any deductions) over that level, a Massachusetts estate tax return must be filed. However, estate tax is only due if the taxable estate (after deductions) exceeds $1 million.

How High Are Beer Taxes in Your State?

Tax rates are approved annually by the Department of Revenue to ensure that municipalities have balanced budgets and tax levies within the limits set by Proposition 2 ½. (PDF) The tax rate and assessed value for any given fiscal year are the two components necessary to determine annual taxes. The value of a parcel what is massachusetts income tax rate multiplied by the appropriate tax rate divided by 1,000 will equal the total taxes to be assessed in a fiscal year. While investments funded with Fair Share revenue clearly would benefit communities throughout the Commonwealth, a top rate of 9 percent would compare well with top rates in other states.

To lookup the sales tax due on any purchase, use our Massachusetts sales tax calculator. Unlike a Value Added Tax (VAT), the Massachusetts sales tax only applies to end consumers of the product. Individuals and companies who are purchasing goods for resale, improvement, or as raw materials can use a Massachusetts Sales Tax Exemption Form to buy these goods tax-free.

Past years’ tax brackets

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 your wages and tips are subject to either social security tax or the Tier 1 part of railroad retirement tax, or both, and total at least $160,200, do not pay the 12.4% social security part of the SE tax on any of your net earnings. However, you must pay the 2.9% Medicare part of the SE tax on all your net earnings.

Massachusetts allows for other miscellaneous deductions, such as jury duty pay surrendered to your employer, some attorney fees and court costs for unlawful discrimination and other expenses. If your principal residence is in Massachusetts and you paid rent to a landlord in the past year, you can deduct 50% of the rent paid, up to $3,000 (up to $1,500 for married filing separate filers). Unlike the 6.25% sales tax, which is collected by sellers, use tax is generally paid directly to the state by the purchaser.

Standard Deduction

Property taxes in Massachusetts are one of the most significant sources of revenue for local governments. In some counties, median property taxes paid exceed $5,300 per year. The state’s effective property tax rate (taxes paid as a percentage of market value) is 1.12%.

what is massachusetts income tax rate

Gasoline and diesel taxes in Massachusetts each total 24 cents per gallon. Massachusetts has some of the highest cigarette taxes in the nation. The tax is $3.51 per pack of 20, which puts the final price of cigarettes in Massachusetts at around $10.00 per pack.


How large depends on the amount you earn, as well as where you live and work. Here’s how it works, and a list of state tax rates across the U.S. There are no additional local taxes collected, so 6.25% is the rate you will pay regardless of where you are in the state. The tax is on the purchase or use of “tangible personal property.” This includes nearly any purchasable good, with some exceptions.

what is massachusetts income tax rate

The Massachusetts legislature is considering creating the Child and Family Tax Credit (CFTC), a refundable tax credit for families with children and adult dependents. It is important for our elected officials to choose a more generous option, as many of our neighbors’ household budgets strain under the weight of an affordability crisis. No problem – you can find Massachusetts state tax expertise with all of our ways to file taxes. The state tax deadlines often coincide with the federal tax deadline, which typically is on the federal tax deadline. You can pay your Massachusetts state taxes online at MassTaxConnect (through the state’s Department of Revenue) or via mail.

Registering a motor vehicle automatically triggers the assessment of excise, which is calculated at a rate of $25 per $1,000 of value. Excise Tax is assessed from the 1st day of the month in which it is registered for the balance of the calendar year and on January 1 of each year thereafter. Vehicles registered during the year are issued a pro-rated excise tax bill for that year. For FY2023, Northampton’s tax rate is $15.84 per $1,000 of assessed property value. Employers calculate Social Security and Medicare taxes of most wage earners.

  • Generally, you need to pay at least 80% of your annual income tax liability before you file your return for the year.
  • Our editorial team does not receive direct compensation from our advertisers.
  • Learn more about income taxes and other common tax facts in the state of Massachusetts here.
  • The value of a parcel multiplied by the appropriate tax rate divided by 1,000 will equal the total taxes to be assessed in a fiscal year.
  • Historically, compliance rates with with the Massachusetts Use Tax have been low.
  • As a result, a larger share of the income of high-income filers in these states is subject to the state’s top rate.
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