Section 128 of the Internal Revenue Code, as added by Section 301(a) of the federal Economic Recovery Tax Act of 1981, grants an aggregate exclusion from federal gross income of up to $1,000 on individual returns and $2,000 on joint returns of interest received on a depository institution tax-exempt savings certificate. A tax-exempt savings certificate is a certificate issued by a qualified savings institution between October 1, 1981 and December 31, 1982, inclusive, with a maturity of one year, an interest rate equal to 70% of the latest one-year United States Treasury Bill yield, and which is available in denominations of $500.
For Massachusetts income tax purposes, Massachusetts gross income is federal gross income with certain modifications, determined according to the Internal Revenue Code as amended on November 6, 1978. The Economic Recovery Tax Act of 1981 was adopted on August 13, 1981.
Joyce Hampers
Commissioner of Revenue

August 21, 1981

TIR 81-1