General Rules and Definitions

Massachusetts law determines the filing requirement thresholds for all residents, nonresidents and part-year residents. In many instances there is a filing requirement for an individual even though there may not be a tax liability due to the commonwealth. 

Every individual inhabitant who receives or accrues Massachusetts gross income in excess of $8,000 must make a return of such income. 

Full year residents who receive or accrue Massachusetts gross income in excess of $8,000 during the taxable year are required to file a Massachusetts income tax return. Even if they calculate a zero tax, the requirement to file still exists. Full year residents file Massachusetts Form 1 - Massachusetts Individual Income Tax Return.

Nonresidents are required to file income tax returns with Massachusetts if their Massachusetts gross income (derived from sources within Massachusetts) exceeds either $8,000 or the prorated personal exemption to which they are entitled, whichever is less. Nonresidents file Massachusetts Form 1 NR/PY- Nonresident/Part-Year Resident Individual Income Tax Return.

Part-year residents who receive or accrue Massachusetts gross income in excess of $8,000 during the taxable year are required to file a Massachusetts income tax return. Even if they calculate a zero tax, the requirement to file still exists. Part-year residents file Massachusetts Form 1 NR/PY- Nonresident/Part-Year Resident Individual Income Tax Return.

Definitions of Gross Income:

  • Massachusetts gross income = federal gross income, with certain modifications. Certain items are added/deducted to federal gross income to arrive at Massachusetts gross income. Filing requirements are based on Massachusetts gross income which includes income from all sources, both in and out of Massachusetts.
  • Massachusetts gross income for a nonresident is Massachusetts source income, e.g. income derived from sources within Massachusetts.
  • Massachusetts gross income from all sources for a nonresident is Massachusetts gross income plus non-Massachusetts source income, or income that would be included if a taxpayer were a full year Massachusetts resident. 
  • Part-year resident Massachusetts gross income = income earned during the period of time a Massachusetts resident.

Prorated personal exemption is the amount allowed to a resident multiplied by a ratio, the numerator of which is Massachusetts gross income (derived from sources within Massachusetts) and the denominator of which is Massachusetts gross income derived  from all sources, as if the taxpayer were a full year Massachusetts resident. 

The prorated personal exemption: (PE) formula:

PE per filing status    x    Massachusetts gross income (from sources within MA)   =    Prorated PE
                                            Massachusetts gross income from all sources  

A taxpayer who is a Massachusetts resident for part of the year and a nonresident during the same year with Massachusetts source income in excess of $8,000 during the taxable year is required to file a Massachusetts income tax return. The taxpayer must file Massachusetts Form 1 NR/PY- Nonresident/Part-Year Resident Individual Income Tax Return and Massachusetts Schedule R/NR - Resident/Nonresident Worksheet. This schedule calculates the portion of income earned, as well as the deductions and exemptions allowed while a part-year resident and a nonresident.

Taxpayers who have a filing requirement may still qualify for No Tax Status or Limited Income Credit

Refunds for Taxpayers Who Are Not Required to File a Return:
Taxpayers who have no requirement to file a return but are entitled to a refund of their withholding or estimated tax payments must file tax returns to receive their refunds.


Married Taxpayers

If a married person’s Massachusetts gross income is in excess of $8,000, then that individual must file a return reporting his or her Massachusetts gross income.  A married person with a filing requirement may choose to file a return, either as:

  • married filing separate,  reporting only his or her Massachusetts gross income; or
  • married filing joint with his or her spouse, in which case, Massachusetts gross income from both spouses must be included, even if one spouse’s income is less than $8,000.

Married Taxpayers - Examples

Example 1:

Husband wages= $7,000
Wife wages= $2,000
Combined income= $9,000

In this example, as married filing separate, neither the husband nor the wife has a requirement to file since neither spouse's gross income exceeds the $8,000 threshold. They would file a joint return reporting their joint income, however, if they qualified for certain refundable credits such as the Earned Income credit and the Real Estate Tax Credit for Persons Age 65 or Older (Circuit Breaker) which cannot be claimed if married filing separately.

Example 2:

Husband wages= $10,000
Wife wages= $3,000
Combined income= 13,000

As married filing separate, only the husband has a requirement to file a return since his Massachusetts gross income exceeds the $8,000 threshold. He can either file a separate return and include only his income, or the taxpayers can file a joint return, in which case, the wife's wages must be included.   They would file a joint return if they qualified for certain refundable credits such as the Earned Income credit and the Real Estate Tax Credit for Persons Age 65 or Older (Circuit Breaker) which cannot be claimed if married filing separately.


Nonresident - Examples

Example 1 -
illustrates that a nonresident having less than $8,000 Massachusetts gross income is still required to file if such income exceeds the personal exemption to which the nonresident is entitled.

Nonresident who is Single:

Massachusetts wages = $7,400
Rhode Island lottery winnings = $4,300

Personal exemption for single filer = $4,400

Massachusetts gross income (from sources within Massachusetts)= $7,400
Massachusetts gross income from all sources= $11,700
Ratio of Massachusetts gross income to Massachusetts gross income from all sources= $7,400/$11,700 = 63% (.63)
Prorated personal exemption that would be allowed if required to file= $4,400 x .63 = $2,772

This nonresident taxpayer is required to file since Massachusetts gross income of $7,400 exceeds the prorated personal exemption of $2,772. 

Example 2 - illustrates that if Massachusetts gross income derived from all sources as if a full year Massachusetts resident, is less than the full personal exemption to which the nonresidents would be entitled, there would be no filing requirement.

Nonresidents who are Married:

Massachusetts wages: = $3,300
New York unemployment compensation = $5,400

Personal exemption for married filing joint filers = $8,800

Massachusetts gross income (from sources within Massachusetts)= $3,300
Massachusetts gross income from all sources= $8,700
Ratio of Massachusetts gross income to Massachusetts gross income from all sources= $3,300/$8,700 = 38% (.38)
Prorated personal exemption that would be allowed if required to file= $8,800 x .38 = $3,344

Since Massachusetts gross income of $3,300 does not exceed the pro-rated personal exemption of $3,344, these nonresident taxpayers do not have a requirement to file. 

Example 3 - Definition of Massachusetts gross income means gross income/profit (gross receipts less costs of goods sold), not net profit or loss.

Single taxpayer whose only Massachusetts source income is rental property:

Massachusetts rental receipts= $16,000
Massachusetts rental expenses= ($21,000)
Massachusetts gross income, net rental loss= ($5,000) considered 0
Gross income from all sources= $42,000
Line 14g, Ratio of Massachusetts gross income to Massachusetts gross income from all sources= 0/$42,000 = 0% (.00)
Prorated personal exemption allowed= $ 4,400 x 0% = $0

Since Massachusetts gross income of $16,000 exceeds the pro-rated personal exemption of $0, the nonresident taxpayer is required to file a return.


Massachusetts References: 

  • M.G.L. Chapter 62C, Sections 6(a)