• Personal Income

    The Massachusetts personal income tax rate is 5.1% – on both earned income (salaries, wages, tips, commissions) and unearned (interest, dividends and capital gains.). Certain capital gains are taxed at 12%.

    An individual first calculates gross income which is income from whatever source derived including (but not limited to) the compensation for services, wages, pensions, business income, rents, royalties, dividends, interest, capital gains, alimony, annuities, etc.

    Certain business and personal deductions as well as exemptions may reduce gross income to arrive at that income subject to tax. 

    Select Tax Changes for 2016 for brief descriptions of major personal income tax law changes in Massachusetts. Also see the Guide to Personal Income Tax