Massachusetts Tax Tables 2020 Tax Rates and Thresholds in Massachusetts

The method set out on page 13  seeks to ensure that 9% withholding is applied to supplemental wage payments that will be subject to the surtax. Note that this method applies regardless of whether the supplemental wage payment was made at the same time or separately from regular wages. Starting with tax year 2024, all married couples that file jointly for federal purposes are required to file jointly in Massachusetts, unless an exception applies. There is no exception for married couples that are subject to the 4% surtax, even if they have different a residency status or residency period in Massachusetts. DOR has posted instructions for married taxpayers subject to the surtax with different residency or periods of residency for tax year 2024. The 2021 tax rates and thresholds for both the Massachusetts State Tax Tables and Federal Tax Tables are comprehensively integrated into the Massachusetts Tax Calculator for 2021.

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If the credit you’re owed exceeds the amount of the total tax payable for the year, you’ll be refunded the additional amount of the credit without interest. The federal standard deduction for a Head of Household Filer in 2021 is $ 18,800.00. The federal standard deduction for a Head of Household Filer in 2023 is $ 20,800.00. The federal standard deduction for a Head of Household Filer in Bakery Accounting 2020 is $ 18,350.00.

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• For comparison purposes, however, your Massachusetts tax bracket is the tax bracket in which your last earned dollar in any given tax period falls.
• You’re allowed a $700 exemption if you’re age 65 or older before the end of the year.
• In November 2022, Bay State voters approved an additional 4 percent tax on annual income above $1 million, beginning in tax year 2023.
• This includes the taxable income of the individual that is reported on the composite return.
• The federal standard deduction for a Head of Household Filer in 2024 is $ 21,900.00.

This flat rate means you owe the same percentage regardless of your income. You can save time and money by electronically filing your Massachusetts income tax directly with 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.

Massachusetts Taxable Income

Massachusetts’s tax system ranks 41st overall on the 2025 State Tax Competitiveness Index. Property taxes in the Bay State are relatively high, and the Commonwealth also has an estate tax. In the Bay State, estates are taxed at rates ranging from 0.8 percent to 16 percent, depending on the value of the estate. Long-term capital gains from investments are taxed at 5 percent in Massachusetts, and short-term capital gains are taxed at 8.5 percent. Long term gains from the sale or exchange of collectibles is taxed at 12 percent. A long-term capital gain is a profit from selling an asset you’ve owned for more than one year.

• As far as standard deductions go, a state personal exemption exists and varies based on your filing status.
• 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.
• The two most popular tax software packages are H&R Block At Home, sold by the H&R Block tax preparation company, and TurboTax Federal & State, sold by the Intuit software company.
• Massachusetts tax rates are expected to remain stable, but potential policy changes could affect deductions and surtaxes.
• The Tax tables below include the tax rates, thresholds and allowances included in the Massachusetts Tax Calculator 2024.

The Social Security tax rate is 6.2% of your wages up to a certain limit ma tax bracket ($160,200 for 2023). The 2022 tax rates and thresholds for both the Massachusetts State Tax Tables and Federal Tax Tables are comprehensively integrated into the Massachusetts Tax Calculator for 2022. This tool is freely available and is designed to help you accurately estimate your 2023 tax return. Social Security retirement benefits are fully exempt, but any other retirement income, for example, payments from a retirement savings plan, is taxed at the state income tax rate of five%.

As a refundable credit, the EITC not only reduces the amount of tax owed but can also result in a refund if the credit exceeds the taxpayer’s total tax liability. This makes the EITC a powerful tool for reducing poverty, incentivizing work, and providing financial support to those who need it most. The credit amount varies based on the taxpayer’s income, marital status, and number of qualifying children, with the intention of providing greater assistance to families with children. Massachusetts provides a wide array of credits (dollar for dollar offsets of tax liability) including an earned income tax credit, a circuit breaker credit and a solar, wind and energy tax credit. Because income, particularly from capital gains, is closely tied to economic performance, it can be a volatile source of revenue. Accordingly, it’s critical to identify strategies that can reduce this tax.

Do I have to pay Massachusetts state income tax?

Keep in mind that this payroll estimator assumes all income is from wages, assumes the standard deduction, and does not account for tax credits. Personal income tax deductions decrease your taxable income, which means you owe less taxes. 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.

Your Income Taxes Breakdown

You can also request additional withholding amounts if you want to have more taxes taken out of your paycheck. This might be the case if you have non-wage income outside your job that isn’t subject to withholding. State income tax is collected by Massachusetts and applies to residents and non-residents who earn income here in the state.