Tax Year 2024 Personal Income (Chapter 62) Changes
For more up-to-date and detailed information and to view all of the public written statements referenced, go to the 2024 Form 1 and Form 1-NR/PY Instructions.
Filing Due Dates
Form 1 is due on or before April 15, 2025.
2024 Personal Income Tax Rates
The tax rate on most classes of taxable income is 5%. The tax rate on long-term gains from the sale or exchange of collectibles is 12% (subject to a 50% deduction). For tax years beginning on or after January 1, 2023, the tax rate on short-term gains from the sale or exchange of capital assets is 8.5%.
4% Surtax
Starting with tax year 2023, personal income taxpayers must pay an additional 4% (4% surtax) on taxable income over $1,000,000, increased annually for inflation (surtax threshold). For the 2024 tax year, the threshold is $1,053,750. See Technical Information Release (TIR) 23-12 and the 4% Surtax FAQs for more information.
Changes to Massachusetts joint filing requirements
For tax years beginning on or after January 1, 2024, married couples must file a joint personal income tax return for any year in which they file a joint federal income tax return, unless an exception applies. See TIR 24-4 and proposed regulation 830 CMR62.5A(11), Non-Resident Income Tax for additional information.
Repeal of the Deduction of Interest from Massachusetts banks
Effective for taxable years beginning on or after January 1, 2024, the deduction previously allowed for a deduction of up to $100 ($200 for joint filers) of interest from Massachusetts banks is repealed.
Employer-Provided Parking, Transit Pass, and Commuter Highway Vehicle Benefits Exclusion Amounts
Massachusetts conforms to the federal income exclusion for employer-provided parking, transit pass, and commuter highway vehicle transportation benefits. The IRS has determined that the 2024 inflation-adjusted monthly exclusion amounts are $315 for employer-provided parking and $315 for combined transit pass and commuter highway vehicle transportation benefits.
Penalty for Failure to Obtain Health Insurance
Massachusetts requires most adults 18 and over with access to affordable health insurance to obtain it. In 2024, individuals must be enrolled in health insurance policies that meet minimum creditable coverage standards defined in regulations adopted by the Commonwealth Health Insurance Connector Authority (Health Connector). Individuals who are deemed able to afford health insurance but fail to obtain it are generally subject to penalties in Massachusetts for each month of noncompliance in the tax year. The monthly penalties for 2024, which will be imposed through the individual’s personal income tax return, are set out in TIR 24-1 and are based on the monthly insurance premium for which an individual would have qualified through the Health Connector.
Annual Update of Circuit Breaker Tax Credit
Taxpayers aged 65 or older who own or rent residential property located in Massachusetts are allowed a credit equal to the amount by which their total real estate tax payments, or 25% of their rent in the case of a renter, exceeds 10% of the taxpayer’s total income. The credit cannot exceed a certain maximum amount that is determined by multiplying a statutory base amount by a cost-of-living adjustment for the calendar year in which the taxable year begins. The maximum credit for tax year 2024 is $2,730.
The amount of the credit is subject to limitations based on the taxpayer’s total income and the assessed value of the real estate, which for tax year 2024 must not exceed $1,172,000 . For purposes of calculating the credit, total income and maximum credit thresholds are adjusted annually for inflation. For tax year 2024, an eligible taxpayer’s total income cannot exceed $72,000 in the case of a single filer who is not a head of household filer; $91,000 in the case of a head of household filer; and $109,000 in the case of a joint filer. To qualify for the credit, a taxpayer must be age 65 or older and must occupy the property as his or her principal residence.
Child and Family Tax Credit
Effective for taxable years beginning on or after January 1, 2024, the refundable, non-transferable child and family tax credit (“CFTC”) for taxpayers who maintain a household that includes certain individuals increases from $310 to $440 for each such individual, with no limit to the number of such individuals that may qualify for the credit. See TIR 24-4 for additional information.
In addition, starting with tax years beginning on or after January 1, 2024, a noncustodial parent may claim the credit with respect to a child dependent that is age 13 or older and who is physically or mentally incapable of caring for himself or herself. See TIR 24-4 for additional information.
Expansion of Septic Credit
Effective for tax years beginning on or after January 1, 2024, the credit for expenses incurred in repairing or replacing failed cesspool or septic systems has been expanded to included expenses incurred for repairs, replacements, upgrades or sewer connections that are required by Title 5 of the State Environmental Code, 310 CMR 15.000, or a watershed permit issued by the Department of Environmental Protection. See TIR 24-14 for additional information.
Temporary Authorized Training Tax Credit for Emergency Assistance
A new credit takes effect for tax years beginning on or after January 1, 2024. The credit is available to businesses that provide training to individuals receiving benefits through the Massachusetts emergency housing assistance program. The credit is equal to $2,500 for each such employee. The credit is temporary. It is available only for tax years during which the emergency housing assistance program is subject to capacity limitations. The credit is no longer available as of January 1, 2026. See TIR 24-7 for additional information.
Qualified Veterans Hire Tax Credit
For tax years beginning on or after January 1, 2024, the qualified veterans hire tax credit for qualified employers that hire eligible veterans increases from $2,000 to $2,500. See TIR 24-15, Tax Provisions in An Act Honoring, Empowering, and Recognizing Our Servicemembers and Veterans, for additional information.
Updated IRC Conformity Date ("Code Update")
In general, a taxpayer’s Massachusetts gross income and many deductions are based on the taxpayer’s federal gross income and deductions under the IRC as of a specific date. For tax years beginning on or after January 1, 2024, the Massachusetts personal income tax generally conforms to the IRC as amended on January 1, 2024. The Massachusetts personal income tax previously conformed to the IRC as amended on January 1, 2022.
As a result of this update, the Massachusetts personal income tax will now conform to federal tax law changes affecting the determination of Massachusetts gross income and deductions that have been enacted since 2022. See TIR 24-14.
As a general rule, Massachusetts does not conform to any personal income tax law changes to the IRC made after January 1, 2024. However, certain specific Massachusetts personal income tax provisions, as set forth in MGL ch 62, § 1(c), automatically conform to the IRC currently in effect. The provisions of the IRC that Massachusetts conforms to on a current basis include those provisions relating to:
- Roth IRAs;
- IRAs;
- The exclusion for gain on the sale of a principal residence;
- Trade or business expenses;
- Travel expenses;
- Meals and entertainment expenses;
- The maximum deferral amount of government employees’ deferred compensation plans;
- The deduction for health insurance costs of self-employed taxpayers;
- Medical and dental expenses;
- Annuities;
- Health savings accounts;
- Employer-provided health insurance coverage;
- Amounts received by an employee under a health and accident plan; and
- Contributions to qualified tuition programs.
Tax Year 2024 Corporate Excise (Chapter 63) Changes
For more up-to-date and detailed information and to view all of the public written statements referenced, go to the 2024 Form 335 Instructions.
Filing Due Dates
Massachusetts General Laws (MGL) ch. 62C, §§ 11 and 12 require C corporations to file their tax returns on or before the 15th day of the fourth month following the close of each taxable year. The filing due date for S corporation tax returns is the 15th day of the third month following the close of each taxable year. For more information, see Technical Information Release (TIR) 17-5.
Temporary Authorized Training Tax Credit for Emergency Assistance
A new credit takes effect for tax years beginning on or after January 1, 2024. The credit is available to businesses that provide training to individuals receiving benefits through the Massachusetts emergency housing assistance program. The credit is equal to $2,500 for each such employee. The credit is temporary. It is available only for tax years during which the emergency housing assistance program is subject to capacity limitations. The credit is no longer available as of January 1, 2026. See TIR 24-7 for additional information.
Qualified Veterans Hire Tax Credit
For tax years beginning on or after January 1, 2024, the qualified veterans hire tax credit for qualified employers that hire eligible veterans increases from $2,000 to $2,500. See TIR 24-15, Tax Provisions in An Act Honoring, Empowering, and Recognizing Our Servicemembers and Veterans, for additional information.
Singles Sales Factor Apportionment
Effective for tax years beginning on or after January 1, 2025, corporate excise and financial institution excise filers that apportion their income to Massachusetts must do so by using the sales or receipts factor only. In addition, for such tax years, the computation of the receipts factor for financial institutions has been changed with respect to receipts from investment and trading assets and activities. See TIR 24-4, Section IV. Filers that have short tax years beginning on or after January 2025 and ending during 2025 may be required to use the 2024 forms to file for the short year if the applicable 2025 forms are not available at the time the short year return must be filed. See TIR 11-12. Short year filers using 2024 returns in this manner must determine their sales or receipts factors using single sales factor apportionment and, if they are financial institutions, must apply the new rules applicable to receipts from investment and trading assets and activities.
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