Guide Personal Income Tax for Part-Year Residents

This guide has general information about Personal Income tax for Massachusetts part-year residents. It is not designed to address all questions which may arise nor to address complex issues in detail. Nothing contained herein supersedes, alters or otherwise changes any provision of the Massachusetts General Laws, Massachusetts Department of Revenue Regulations, Department rulings or any other sources of the law.

Residency Status

If you're a part-year resident with an annual Massachusetts gross income of more than $8,000, you must file a Massachusetts tax return.

You're a part-year resident if you:

  • Move to Massachusetts during the tax year and become a resident, or
  • Move out of Massachusetts during the tax year and end your status as a resident. 

Part-year residents use Form 1-NR/PY Massachusetts Nonresident or Part-Year Resident Income Tax Return.

Use Schedule R/NR – Resident/Nonresident Worksheet to adjust your income, deductions, exemptions and Earned Income Credit.

Filing Status

For federal purposes, your filing status determines your income tax rate. For Massachusetts purposes, your filing status determines how many personal exemptions you're allowed. For federal purposes, there are 5 filing statuses:

  • Single
  • Married filing a joint return
  • Married filing a separate return
  • Head of household
  • Qualifying widow(er) with dependent child

Massachusetts offers all but the qualifying widow(er) with dependent child. Generally, if you claim this status federally, you qualify for head of household for Massachusetts. 

View more detailed information on filing status here.

Single

You can file as single, if at the end of the taxable year, you were:

  • Unmarried, or
  • Legally separated under a final judgment of the probate court

You cannot file as single if:

  • Your divorce or separate maintenance decree is not final
  • You have a temporary support order
  • You and your spouse simply choose to live apart

If you get a judgment from the probate court that you're living apart from your spouse for justifiable cause, you may file a Massachusetts income tax return as single.

Married

If you're legally married as of the last day of the tax year, you can file either jointly or separately. Massachusetts law does not recognize common law marriages. Same-sex couples can file as married, jointly or separately.

You can file as married filing joint if you meet these 2 conditions:

  1. You and your spouse must be legally married as of the last day of the year, and
  2. You and your spouse must have a Massachusetts taxable year that begins and ends on the same day

Taxpayers who are legally married as of the last day of the tax year can file as married filing separately.

If married taxpayers have a Massachusetts residency tax year that begins and ends on different days, they must file married filing separately, assuming each spouse is required to file.

Married filing separate taxpayers may only claim a maximum deduction of $1,500 each, unless a statement from the other spouse is provided, allowing 1 spouse to take more than the $1,500 deduction. The consenting spouse must sign the statement and list:

  • Their name
  • Their address
  • Their social security number, and
  • The amount of rental deduction taken by each spouse

Head of household

You may file as head of household if you meet all of the following criteria:

  1. You're unmarried or considered unmarried on the last day of the year. You're unmarried on the last day of the tax year if you're legally separated from your spouse under a divorce or separate maintenance agreement.
  2. You paid more than half the cost of keeping up a home for the year, and
  3. A qualifying person lived with you in the home for more than half the year

Qualifying widow(er) with dependent child

If your spouse dies during the tax year, and you and your spouse had a Massachusetts taxable year that began on the same day, you may file married filing jointly for the tax year in which your spouse dies.

Since Massachusetts does not have a filing status equivalent to the federal qualifying widow(er) with dependent child, you can file as head of household for 2 years after the year your spouse died. If you don't meet the head of household requirements in the 2 subsequent years, you would file as single.

Reporting on your original tax return

Enter your filing status on either Form 1 or 1-NR/PY, Line 1, and fill in the appropriate oval. Enter your spouse's Social Security number in the appropriate space at the top of the return under taxpayer's Social Security number. If you're married filing joint, both spouses must sign the return.

Exemptions

As a part-year resident, your exemptions are based on days you spent as a Massachusetts resident.

Multiply your exemptions by the Total Days as a Massachusetts Resident ratio (Form 1-NR/PY, Line 3). This ratio is the number of days you were a Massachusetts resident divided by 365 days.

If you have a short taxable year, you're only allowed the exemptions related to the number of days you spent as a Massachusetts resident divided by 365.

Determining Income

As a part-year resident, you're generally taxed on all your income while you're a resident of Massachusetts, received from sources inside or outside of Massachusetts.

Massachusetts gross income is income earned from all sources while a Massachusetts resident.

Deductions

For part-year residents, deductions are based on days you spent as a Massachusetts resident.

The deduction must be multiplied by the Total Days as a Massachusetts Resident ratio ratio (Form 1-NR/PY, Line 3). This ratio is the number of days you were a Massachusetts resident divided by 365 days.

The following deductions are allowed in full if directly related to specific taxable income reported on Form 1-NR/PY or to a personal Massachusetts residence:

  • FICA, Medicare, RR, U.S. or Massachusetts retirement deduction
  • Certain Schedule Y deductions:
    • Employee business expenses
    • Most miscellaneous deductions from U.S. 1040, Line 36
    • Moving expenses
    • Penalty on early savings withdrawal. This is only available if the penalties were related to Massachusetts reportable or previously reported interest income on a Massachusetts tax return.
    • Self-employed health insurance
    • Incapacitated firefighter and police officer income excluded under G.L. c.41, s.111F
    • Income excluded income per U.S. tax treaties
  • Rental deduction. You're allowed a deduction of 50% of the rent paid (up to $3,000) if the residence is located in Massachusetts and it's your main residence.

Part-year residents may also be allowed the following deductions. If allowable, multiply the deduction by the Total Days as a Massachusetts Resident ratio (Line 3).

  • Child under age 13/disabled dependent/spouse care expenses *
  • Number of dependent household members under age 12, dependents age 65 or over, or disabled dependents
  • Certain Schedule Y deductions:
    • Alimony paid *
    • Clean fuel vehicles
    • College tuition
    • Health savings accounts
    • Medical savings account
    • Student loan interest
    • Undergraduate student loan interest

* You may claim these deductions in full only for what you paid while you were a Massachusetts resident.

Credits

As a part-year resident, you may also qualify for certain personal income tax credits, which can reduce the amount of tax you owe.

Business-related credits

See business-related credits you may be able to claim on your personal income tax return.

Earned Income Tax Credit (EITC)

The Earned Income Tax Credit (EITC), or Earned Income Credit (EIC), benefits working families with low to moderate incomes. You're entitled to the EITC if you have Massachusetts source earned income and file a tax return, even if you don't owe any tax or aren't required to file.

The amount of the Massachusetts EITC is limited to 23% of the federal EITC multiplied by the total number of days you resided in Massachusetts divided by 365 days.

You're eligible for the credit if you:

  • Have a qualifying child for the taxable year, or
  • Do not have a qualifying child for the taxable year but still meet all of the following criteria:
  • Lived in the United States for more than half of the taxable year
  • You or your spouse is at least 25 years old but younger than 65 years old before the end of the taxable year
  • You're not a dependent of another taxpayer during the taxable year

You're not eligible for the EITC if you have investment income greater than $3,400 for the year. Investment income includes:

  • Capital gain net income
  • Net passive income
  • Interest
  • Dividends
  • Tax-exempt interest
  • Non-business rents and royalties

To fill out your return: 

  1. Enter the number of qualifying children you have, if any, in the box on Form 1-NR/PY, Line 45a
  2. Enter the amount reported on either U.S. Form 1040 (Line 66a), U.S. Form 1040A (Line 42a), or U.S. Form 1040 EZ (Line 8a), in the box next to 45a
  3. Multiply the amount reported on U.S. return by 0.23
  4. Multiply that amount by Form 1-NR/PY, Line 3, Total days as Massachusetts resident (which is number of days you spent as a Massachusetts resident, divided by 365)
  5. Enter the new result in Form 1-NR/PY, Line 45

View maximum EIC credit allowed and more information on the EIC here.

Income tax paid to another state or jurisdiction

You're allowed a credit for taxes due to any other jurisdiction. The credit is available only on income reported and taxed on a Massachusetts return. Note that tax due is different from taxes withheld. For this credit, use the calculated tax due, not tax withheld.

This credit is allowed for taxes paid to:

  • Other states in the U.S.
  • Any territory or dependency of the U.S., including:
    • Puerto Rico
    • The Virgin Islands
    • Guam
    • The District of Columbia
    • Canada or any of its provinces
    You must first reduce the taxes you paid by the amount allowed as a federal Foreign Tax Credit on U.S. Form 1116, claimed or not.
  • New Hampshire for business profits tax (considered an income tax)
  • District of Columbia Unincorporated Business Franchise Tax (UBT)

This credit is not allowed for:

  • Taxes paid to the U.S. government
  • Taxes paid to a foreign country other than Canada or any of its provinces
  • Any city or local tax
  • Interest and penalties paid to another jurisdiction
  • Excise, property tax or franchise tax

See if you qualify for taxes paid to other jurisdictions credit by completing Schedule F, Credit for Income Taxes Paid to Other Jurisdictions.

The credit is the smaller of:

  • Massachusetts income tax on income you reported to the other jurisdiction, or
  • The actual tax you paid to the other jurisdiction

View more information on taxes paid to other jurisdictions credit here.

No Tax Status and Limited Income credit

If your Massachusetts Adjusted Gross Income (AGI) doesn't exceed certain amounts for the taxable year, you qualify for No Tax Status (NTS) and are not required to pay any Massachusetts income tax, but still need to file a tax return.

Adjusted gross income is gross income reduced by certain business expenses and other deductions claimed on Massachusetts Schedule Y, Lines 1 to 10, such as allowable employee business expenses, alimony paid or student loan interest, etc. 
Except for Line 4, these are generally federal allowable deductions.

If you do not qualify for No Tax Status (NTS), but your Massachusetts AGI still doesn't exceed certain amounts, you may qualify for the Limited Income Credit (LIC), which may reduce your tax significantly.

Married filing separate taxpayers do not qualify for either NTS or LIC.

See if you qualify for NTS and LIC by completing Schedule NTS-L-NR/PY, No Tax Status and Limited Income Credit, Lines 1 to 11. Compute your Massachusetts adjusted gross income (AGI) as if you were a Massachusetts resident for the entire taxable year.

While determining whether or not you qualify for NTS, include all non-Massachusetts source income as well as all non-Massachusetts Schedule Y, Lines 1 to 10 deductions. Non-Massachusetts source income is all the income you'd have to report if you were a Massachusetts resident. Report all losses as 0.

If you don't qualify for NTS, you may still be entitled to LIC. Fill out Lines 1 to 15.

View more information on No Tax Status and Limited Income credit here.

Residential property credits

View residential property credits you may be able to claim on your personal income tax return here.

Additional Resources for Credits

Image credits:  Triple decker street (George Headley)

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