How to compute ma-income-tax for Massachusetts, tax year 2025: rates, thresholds, and step-by-step rules with primary-source citations.
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Part A income tax rate (interest, dividends, capital gains from non-MA obligations)
5.00%M.G.L. c. 62, § 4(a)
Part B income tax rate (wages, salaries, self-employment, most other income)
5.00%M.G.L. c. 62, § 4(b)
Part C income tax rate (short-term capital gains) — statutory rate
8.50%M.G.L. c. 62, § 4(c)
Part C income tax rate (short-term capital gains) — effective rate after 50% deduction
~12% effective (subject to 50% deduction)M.G.L. c. 62, § 4(c)
Long-term capital gains tax rate
5.00%M.G.L. c. 62, § 4(b)
Surtax additional rate
4%M.G.L. c. 62, § 5A; Article 44 of the Massachusetts Constitution (Fair Share Amendment)
Surtax threshold — TY2023
$1,000,000Article 44 of the Massachusetts Constitution (Fair Share Amendment)
Surtax threshold — TY2024 (inflation-adjusted)
$1,053,750M.G.L. c. 62, § 5A
Surtax threshold — TY2025 (inflation-adjusted)
$1,083,150M.G.L. c. 62, § 5A
Personal exemption — Single (TY2025)
$4,400M.G.L. c. 62, § 3(B)(a)
Personal exemption — Head of Household (TY2025)
$6,800M.G.L. c. 62, § 3(B)(b)(2)
Personal exemption — Married Filing Jointly (TY2025)
$8,800M.G.L. c. 62, § 3(B)(b)(1)
Dependent deduction (TY2025)
$1,000 per dependentM.G.L. c. 62, § 3(B)(a)(3)
Rental deduction — percentage of rent paid
50% of rent paidM.G.L. c. 62, § 3(B)(a)(9)
Rental deduction — maximum amount
$3,000M.G.L. c. 62, § 3(B)(a)(9)
Massachusetts gross income filing threshold
$8,000M.G.L. c. 62, § 5
Form 1 filing deadline — tax year 2026
April 15, 2027M.G.L. c. 62, § 5; Massachusetts DOR
Estimated tax payment obligation threshold — self-employed
$400 expected tax owedM.G.L. c. 62B; Massachusetts Form 1-ES
Estimated tax — 1st quarter due date
April 15M.G.L. c. 62B; Massachusetts Form 1-ES
Estimated tax — 2nd quarter due date
June 15M.G.L. c. 62B; Massachusetts Form 1-ES
Estimated tax — 3rd quarter due date
September 15M.G.L. c. 62B; Massachusetts Form 1-ES
Estimated tax — 4th quarter due date
January 15 (following year)M.G.L. c. 62B; Massachusetts Form 1-ES
Social Security income — Massachusetts treatment
Fully exemptM.G.L. c. 62, § 2(a)(2)(E)
Interest from Massachusetts obligations — Massachusetts treatment
ExemptM.G.L. c. 62, § 2
Interest from other states' obligations — Massachusetts treatment
Taxable (add back any federal exclusions)M.G.L. c. 62, § 2
Federal QBI deduction (Section 199A) — Massachusetts treatment
Not allowedM.G.L. c. 62
Local / county income taxes
None — state tax onlyM.G.L. c. 62
Health insurance mandate — penalty assessed via
Form 1 (Schedule HC)M.G.L. c. 111M; Massachusetts Form 1 Schedule HC
Scope. This skill covers Massachusetts Form 1 (Resident Income Tax Return) for sole proprietors and single-member LLCs. It addresses the flat 5% income tax, the 4% millionaire's surtax, and Massachusetts-specific income classifications. It does NOT cover nonresident/part-year returns (Form 1-NR/PY), corporate excise (Form 355), or trust/estate returns (Form 2).
Quality tier. Q3 — AI-drafted, not independently verified. All outputs must be reviewed by a qualified tax professional before filing.
Metadata
| Field | Value |
|---|---|
| Jurisdiction | Massachusetts (US-MA) |
| Tax authority | Massachusetts Department of Revenue (DOR) |
| Filing portal | MassTaxConnect |
| Legislation | M.G.L. Chapter 62 — Taxation of Incomes |
| Primary form | Form 1 (Massachusetts Resident Income Tax Return) |
| Filing deadline | April 15, 2027 (for tax year 2026) |
| Version | 0.1 |
| Date | May 22, 2026 |
| Validation status | AI-drafted — Q3 |
Income tax rates
| Income type | Rate | Source |
|---|---|---|
| Part A income (interest, dividends, capital gains from non-MA obligations) | 5.00% | M.G.L. c. 62, § 4(a) |
| Part B income (wages, salaries, self-employment, most other income) | 5.00% | M.G.L. c. 62, § 4(b) |
| Part C income (short-term capital gains) | 8.50% (subject to 50% deduction, effective rate ~12%) | M.G.L. c. 62, § 4(c) |
| Long-term capital gains | 5.00% | M.G.L. c. 62, § 4(b) |
Millionaire's surtax thresholds
| Tax year | Surtax threshold | Source |
|---|---|---|
| 2023 | $1,000,000 | Article 44 |
| 2024 | $1,053,750 | Inflation-adjusted |
| 2025 | $1,083,150 | Inflation-adjusted |
| 2026 | TBD (inflation-adjusted, typically announced late in preceding year) | M.G.L. c. 62, § 5A |
Massachusetts does not use a standard deduction in the federal sense. Instead, it provides:
Deductions and exemptions table
| Item | Amount (TY2025) | Source |
|---|---|---|
| Personal exemption — Single | $4,400 | M.G.L. c. 62, § 3(B)(a) |
| Personal exemption — Head of Household | $6,800 | M.G.L. c. 62, § 3(B)(b)(2) |
| Personal exemption — MFJ | $8,800 | M.G.L. c. 62, § 3(B)(b)(1) |
| Dependent deduction | $1,000 per dependent | M.G.L. c. 62, § 3(B)(a)(3) |
| Rental deduction | 50% of rent paid, max $3,000 | M.G.L. c. 62, § 3(B)(a)(9) |
Key differences from federal table
| Item | Massachusetts treatment | Source |
|---|---|---|
| No standard deduction | MA uses personal exemptions and specific deductions instead | M.G.L. c. 62, § 3 |
| Social Security | Fully exempt | M.G.L. c. 62, § 2(a)(2)(E) |
| Interest from MA obligations | Exempt | M.G.L. c. 62, § 2 |
| Interest from other states | Taxable (add back any federal exclusions) | M.G.L. c. 62, § 2 |
| Short-term capital gains | Taxed at 8.50% (not the standard 5%) | M.G.L. c. 62, § 4(c) |
Estimated tax payment due dates
| Voucher | Due date |
|---|---|
| 1st quarter | April 15 |
| 2nd quarter | June 15 |
| 3rd quarter | September 15 |
| 4th quarter | January 15 (following year) |
Use Form 1-ES for estimated payments.
Tier 1 rules table
| Rule | Description |
|---|---|
| R-1 | Apply 5% to Part A and Part B income. Apply 8.50% to Part C (short-term capital gains). |
| R-2 | Apply the 4% surtax on total taxable income exceeding the inflation-adjusted threshold ($1,083,150 for TY2025). |
| R-3 | Social Security is fully exempt. |
| R-4 | Interest from U.S. obligations is exempt. |
| R-5 | Interest from Massachusetts municipal bonds is exempt; interest from other states' bonds is taxable. |
| R-6 | Massachusetts does NOT have a standard deduction — use the personal exemption system. |
| R-7 | Long-term capital gains are taxed at 5%, NOT the short-term rate. |
| R-8 | Massachusetts has NO local/county income taxes. Only the state tax applies. |
| R-9 | Filing threshold: $8,000 of MA gross income. |
Tier 2 rules table
| Rule | Description |
|---|---|
| J-1 | Classify income correctly among Part A, Part B, and Part C — misclassification changes the rate. |
| J-2 | Determine whether the taxpayer's total income approaches the surtax threshold and whether income timing strategies are appropriate. |
| J-3 | Evaluate Massachusetts deductions vs. federal deductions (they differ significantly). |
| J-4 | Assess the health insurance mandate penalty when the taxpayer had gaps in coverage (Schedule HC). |
| J-5 | Determine credit for taxes paid to other states for multi-state income. |
Supplier pattern library table
| Pattern | Massachusetts treatment |
|---|---|
| Freelance income (Schedule C) | Part B income. Taxed at 5%. |
| Rental income (Schedule E) | Part B income. Taxed at 5%. |
| Short-term capital gains | Part C income. Taxed at 8.50%. |
| Long-term capital gains | Part B income. Taxed at 5%. |
| Interest / dividends | Part A income. Taxed at 5%. MA and U.S. obligations exempt. |
| Social Security | Fully exempt. |
| Pension / retirement | Part B income. Taxed at 5%. |
Form 1 line mapping table
| Form 1 line | Description | Source |
|---|---|---|
| Lines 1–4 | Part A income (interest, dividends) | M.G.L. c. 62, § 2 |
| Lines 5–10 | Part A deductions and exemptions | M.G.L. c. 62, § 3 |
| Line 10 | Part A taxable income | Computed |
| Lines 11–14 | Part B income (wages, self-employment, pensions) | M.G.L. c. 62, § 2 |
| Lines 15–20 | Part B deductions and exemptions | M.G.L. c. 62, § 3 |
| Line 20 | Part B taxable income | Computed |
| Line 21 | Part C income (short-term capital gains) | M.G.L. c. 62, § 2 |
| Line 23 | Total 5% income tax (Part A + Part B at 5%) | Computed |
| Line 24 | 8.50% tax on Part C | Computed |
| Line 25 | Total income tax before credits | Sum |
| Line 28 | Credits | Various |
| Line 29 | 4% surtax (if applicable) | M.G.L. c. 62, § 5A |
| Lines 34–39 | Payments, withholding, estimated payments | Various |
| Line 43 | Balance due or refund | Computed |
Refusal catalogue table
| Code | Situation | Action |
|---|---|---|
| REF-MA-01 | Taxpayer is a nonresident or part-year resident | Refuse; requires Form 1-NR/PY. |
| REF-MA-02 | Taxpayer has complex Part A / Part B / Part C classification issues | Flag for reviewer. |
| REF-MA-03 | Taxpayer's income exceeds the surtax threshold and involves timing strategies | Flag for reviewer — surtax cliff analysis needed. |
| REF-MA-04 | Taxpayer claims complex credits (e.g., Brownfields, Life Sciences, Film) | Flag for reviewer. |
| REF-MA-05 | Taxpayer has Schedule HC penalty issues (gaps in health insurance coverage) | Flag for reviewer — penalty computation is complex. |
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Other Massachusetts computations in the OpenAccountants Tax Library.
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