A deduction is allowed for rent paid by the taxpayer during the tax year to a landlord for a principal residence located in Massachusetts. This deduction is limited to 50% of the rent paid and cannot exceed a total deduction of $3,000.
Rent paid by third party on taxpayer's behalf
If rent is paid by a third party who maintains a principal residence elsewhere, a rental deduction isn't allowed for either party.
An example of a third party would be a parent.
If 2 or more persons jointly rent a unit, each occupant is entitled to a deduction if each is using it as his or her principal residence. The deduction is based on the amount of rent each person paid.
The definition of principal residence includes:
- Mobile home, mobile home site, or trailer park site rental if it’s the taxpayer's principal residence
- Hotel, motel, or rooming house occupancy if a rental agreement exists creating a landlord-tenant relationship
- Nursing home or retirement home for the elderly if a rental agreement exists creating a landlord-tenant relationship
A principal residence doesn't include:
- Apartment or house of a student or faculty member who has a principal residence elsewhere
- Apartment or house of a nonresident who has a legal residence in another state or country
- Apartment for a person on a temporary assignment in Massachusetts
- Dorm room
- Hotel, motel, or rooming house occupancy where no rental agreement exists
- Nursing home or a retirement home for the elderly where no rental agreement exists
- Vacation home
Only amounts paid specifically as rent can be taken as a deduction in addition to amounts paid for utilities, furnishing, and parking only if the landlord doesn't make separate charges for these items. Amounts paid for condominium fees and advance payments, such as a security deposit and last month's rent, do not constitute rent.
Married filing separate
Married filing separate taxpayers are limited to a rent deduction equal to 50% of the rent each pays and cannot exceed $1,500 per return.
However, a married couple filing separate may allocate the rent deduction differently provided that the amount taken by each spouse doesn't exceed 50% of the rent actually paid by that spouse and their combined rent deduction doesn't exceed $3,000.
The spouse claiming a deduction more than $1,500 must attach to his or her return a statement signed by the other spouse giving consent to the allocation.
The statement must list the name, address, and Social Security number of the consenting spouse, and amount of rental deduction taken by that spouse.
Nonresidents and part-year residents
Nonresidents and part-year residents are allowed a deduction equal to 50% of the rent paid if their residence is:
- Located in Massachusetts and
- The taxpayer's principal residence
The rental deduction cannot be more than $3,000.
Nonresidents entitled to this deduction would be individuals who have no domicile, for example migrant workers, who come to Massachusetts and pay rent while they are working here.
Reporting rent on your tax return
Residents and part-year residents should enter the total amount of rent on:
- Massachusetts Form 1, Line 14a or
- Massachusetts Form 1-NR/PY, Line 18a
Residents and part-year residents should then divide the total amount by 2 and enter the allowable amount on:
- Massachusetts Form 1, Line 14, or
- Massachusetts Form 1-NR/PY, Line 18
Married filing separately
A spouse claiming a deduction more than $1,500 must enclose a statement signed by the other spouse agreeing to allocate some or the other spouse’s entire portion of the deduction.
The statement must list the name, address, and Social Security number of the consenting spouse, and the amount of rental deduction taken by that spouse.
Submitting an abatement or amended tax return
If you’re filing an abatement or amended tax return, you must submit the following:
- Landlord's name
- Written consent signed by your spouse agreeing to allocate some or your spouse’s entire portion of the deduction to you if married filing separate
- M.G.L. Chapter 62, Section 3B(a)(9) as amended by St. 1999, c. 127, ss. 70; 379
- 830 CMR 62.3.1: Rent Deduction
- TIR 99-19: Tax Changes in the Fiscal Year 2000 Budget, Other Than the Capital Gains and the repeal of the "Pay to Play" Provisions
- TIR 86-5: Rental Deduction, Married Couples Filing Jointly and Separately
- DD 86-26: Rental Deduction (Nonresidents)
- DD 86-17: Rental Deduction (Single Filers Renting Jointly)
- LR 85-29: Rental Deduction for Married Couples
- LR 82-63: Legal Separation: Filing Status, Rent Deduction
- LR 82-34: Rent Deduction, Nursing Home
- LR 82-33: Rent Deduction, Home for The Elderly
Page updated: March 26, 2020