| Date: | 12/06/1992 |
|---|---|
| Organization: | Massachusetts Department of Revenue |
| Referenced Sources: | Massachusetts General Laws |
Personal Income Tax
Beginning December 14, 1982 banking institutions will be permitted by federal law to offer "money market deposit accounts."
Under the enabling statute (12 U.S.C. s. 3503) and the regulations of the Depository Institution Deregulation Committee (12 C.F.R. s. 1204.122) the principal features of these accounts are 1) there are no restrictions on the rate of interest that may be paid other than that the rate cannot be guaranteed for more than one month at a time; 2) the initial deposit and average balance must be at least $2,500; 3) preauthorized transfers from the account are limited to six per month, of which no more than three may be by check. These deposits will be insured by the appropriate federal agencies.
For Massachusetts income tax purposes, interest on money market deposit accounts in banking institutions located in Massachusetts will be includible in Massachusetts gross income as Part B income, taxable at the rate of 5% plus surtax, and will be eligible for the $100 deduction ($200 for a husband and wife filing a joint return) provided by General Laws Chapter 62, Section 3(B)(6).
Joyce Hampers
Commissioner of Revenue
December 6, 1982
TIR 82-4