Massachusetts State Tax Guide 2026
Massachusetts has a flat 5.0% income tax rate on most income, plus a 4% surtax on income exceeding $1,083,150. The Bay State's "Fair Share Amendment" (also called the "Millionaire's Tax") was approved by voters in 2022 and took effect in 2023. This brings the effective top rate to 9% for high earners - higher than all states except California, Hawaii, New York, and New Jersey.
⚠️ Massachusetts "Millionaire's Tax":
- Base rate: 5.0% on ALL income
- Surtax: +4% on income over $1,083,150 (indexed annually)
- Total top rate: 9.0% (5% + 4%)
- Comparison: Tied with NJ (10.75% starting at lower threshold)
- Revenue use: Education & transportation improvements
🎯 Massachusetts Tax Benefits:
- Simple flat 5% for most taxpayers (under $1.08M)
- NO local income tax (unlike NYC or some CA cities)
- No Social Security tax
- World-class education - revenue funds schools, transit
- Strong economy: Tech, biotech, healthcare, finance hubs
- Sales tax exemptions: Groceries, clothing under $175
Massachusetts Tax Rates 2026
| Income Type |
Tax Rate |
| Wages, salaries, tips (regular income) | 5.0% |
| Income over $1,083,150 | 9.0% (5% + 4% surtax) |
| Long-term capital gains (dividends, interest) | 5.0% |
| Short-term capital gains | 8.5% |
| Collectibles capital gains (art, antiques) | 12.0% |
Important: The $1,083,150 surtax threshold is indexed for inflation and adjusts annually.
What Taxes Do You Pay in Massachusetts?
Massachusetts residents pay the following taxes:
- Federal Income Tax: Standard federal rates apply (10% - 37%)
- Federal Self-Employment Tax: 15.3% on net self-employment income
- MA State Tax: 5.0% flat + 4% surtax over $1.08M
- NO Local Income Tax: Unlike many other states
- Property Tax: ~1.17% effective rate (above average)
- Sales Tax: 6.25% (groceries exempt, clothing under $175 exempt)
Massachusetts "Fair Share Amendment" Explained
Voters approved the Fair Share Amendment (Question 1) in November 2022 by 52%-48%:
- Effective date: January 1, 2023
- Threshold 2023: $1 million (not indexed)
- Threshold 2024: $1,037,000 (indexed to inflation)
- Threshold 2025: $1,053,750
- Threshold 2026: $1,083,150 (estimated)
- Surtax rate: 4% on income ABOVE threshold
- Revenue dedication: Education and transportation only
Example calculation: $1,500,000 income in 2026:
- First $1,083,150 @ 5% = $54,157.50
- Remaining $416,850 @ 9% (5% + 4%) = $37,516.50
- Total MA tax: $91,674 (6.1% effective rate)
2026 Ballot Question: Cut Tax to 4%?
The Massachusetts Opportunity Alliance is pushing to cut the income tax from 5% to 4% by 2029:
- Status: Certified for potential 2026 ballot (86,970 signatures)
- Proposal: Gradual reduction from 5% to 4% over 3 years
- Cost: Up to $5 billion annually in lost revenue
- Opposition: Strong from Democrats, unions, education advocates
- Likelihood: Unlikely to pass (70% opposed similar measure in 2008)
Even if it passes, the 4% millionaire's surtax would remain, resulting in an 8% top rate instead of 9%.
2026 Federal Tax Brackets (Applies to MA Residents)
| Tax Rate |
Single |
Married Filing Jointly |
| 10% | $0 - $12,400 | $0 - $24,800 |
| 12% | $12,401 - $49,500 | $24,801 - $99,000 |
| 22% | $49,501 - $105,400 | $99,001 - $210,800 |
| 24% | $105,401 - $201,150 | $210,801 - $402,300 |
| 32% | $201,151 - $255,425 | $402,301 - $510,850 |
| 35% | $255,426 - $640,600 | $510,851 - $768,700 |
| 37% | $640,601+ | $768,701+ |
Pros and Cons of Living in Massachusetts
Pros:
- Simple 5% flat tax for most taxpayers (under $1.08M)
- NO local income tax (unlike NYC, some CA cities)
- No Social Security tax
- World-class education system (Harvard, MIT, BU, BC, Tufts, etc.)
- Strong economy: biotech, tech, healthcare, finance
- Excellent public services, infrastructure, healthcare
- Sales tax exemptions: groceries, clothing under $175
- Rich history, culture, sports (Red Sox, Patriots, Celtics, Bruins)
Cons:
- 9% total rate on $1M+ income (5th highest in USA)
- High cost of living (especially Boston metro)
- High property taxes (~1.17% effective)
- Expensive housing market
- Cold winters with significant snow
- Traffic congestion in Boston area
MA vs Neighboring States (2026)
| State |
Income Tax |
Top Rate |
| Massachusetts | 5% + 4% surtax | 9% (over $1.08M) |
| New Hampshire | 0% (eliminated 2025) | 0% |
| Rhode Island | 3.75-5.99% | 5.99% |
| Connecticut | 3-6.99% | 6.99% |
| Vermont | 3.35-8.75% | 8.75% |
Who Should Move to Massachusetts?
- Tech workers: Cambridge/Boston tech corridor (Amazon, Google, Microsoft, startups)
- Biotech/pharma: World leader in life sciences
- Healthcare professionals: Mass General, Brigham, top hospitals
- Students: 100+ colleges/universities
- Finance professionals: Strong financial services sector
- Families: Top-ranked public schools
- Middle-income earners: Only 5% tax (under $1M)
Who Should AVOID Massachusetts?
- High earners over $1M: 9% state + 37% federal = 46% combined!
- Budget-conscious retirees: High taxes, high cost of living
- Those seeking lower taxes: NH (0%), FL (0%), TX (0%) nearby
- Warm weather lovers: Cold, snowy winters
Major Massachusetts Metros
- Greater Boston: Tech, biotech, finance, healthcare, education hub
- Cambridge: MIT, Harvard, tech startups, innovation
- Worcester: Growing biotech, more affordable than Boston
- Springfield: Western MA, lower cost of living
- Cape Cod: Beach communities, tourism, retirees
Important: This calculator estimates Massachusetts state + federal taxes using 2026 rates (5% + 4% surtax over $1,083,150). The millionaire's surtax was approved by voters in 2022 and funds education/transportation. A 2026 ballot question may propose cutting the 5% rate to 4%, but strong opposition makes it unlikely to pass. Massachusetts has NO local income taxes. For complete tax planning, consult with a Massachusetts CPA.