The following deductions are available on Massachusetts state tax returns.
Penalty on Early Savings Withdrawal
If you were assessed a penalty due to early withdrawal of savings, and interest on the savings that such a penalty relates to income reported on Line 5a or Line 20 of your MA return or on a prior-year MA return, you can deduct the penalty amount.
Alimony Paid
You may deduct the total amount (reported on Line 3 of Schedule Y) that you paid to your former spouse for alimony paid or for separate maintenance under court decree, or for excess alimony amounts that were recaptured, as reported on the federal 1040 form, Schedule 1.
NOTE: Alimony payments that are specified as child support may not be deducted.
Amounts Excludible Under MGL Ch. 41, Sec. 111F or U.S. Tax Treaty Included in Form 1, Line 3
The state of Massachusetts allows for an exclusion of certain income received by a firefighter or police officer incapacitated in the line of duty, and an exclusion from income amounts that are exempt under a United States tax treaty received by qualifying students.
Moving Expenses
For tax years 2018 through 2025, the moving expenses deduction is only available to qualified members of the Armed Forces. To qualify for the deduction, the following must be true:
- Be active duty
- Moved due to a military order and permanent change of station
- If the individual is a nonresident or part-year resident, have moved to or from MA due to military orders and permanent change of station
Medical Savings Account
The amount of Medical Savings Account deduction included on Form 1040, Schedule 1, Line 23.
Self-Employed Health Insurance
Enter the amount from Form 1040, Schedule 1, Line 17. If you claimed a federal credit for health insurance costs and reduced the amount on line 17 by that amount, do not add that amount back in on the Massachusetts return.
Health Savings Account
Enter the amount from Form 1040, Schedule 1, Line 13.
Business Expenses of National Guard and Reserve Members, Performing Artists, Impairment-Related Work Expenses and Fee-Based Government Officials
- As a member of the National Guard or a Reservist, if you have to travel greater than 100 miles from home for service, you may deduct unreimbursed expenses such as overnight lodging, travel, and meal expenses.
- As a qualified performing artist, you may deduct expenses related to performances.
- As an individual with physical or mental disability, you may deduct allowable expenses for attendant care at place of employment that enable you to perform work.
- As an official government employee, you may be allowed a deduction for expenses paid related to serviced performed on a fee basis.
Enter the amount from Form 1040, Schedule 1, Line 12.
Student Loan Interest Deduction
Enter the amount from Form 1040, Schedule 1, Line 21; this amount may not exceed $2,500.
NOTE: This deduction is only allowable if you are not claiming the same expenses as Undergraduate Student Loan Interest Deduction.
College Tuition Deduction
You may claim a deduction for tuition payments paid by you, for yourself or a dependent, to a qualifying two, or four-year college leading to an undergraduate or associate's degree, diploma or certificate. Any tuition payments for students pursuing a graduate degree at such a college or university are not eligible for the college tuition deduction.
This deduction is equal to the amount by which the tuition payments, minus any scholarships, grants or financial aid received, exceed 25% of your MA AGI amount.
Undergraduate Student Loan Interest Deduction
You may claim a deduction for interest paid on a qualified undergraduate student loan. To be considered eligible for this deduction, the "education debt" must be a loan that is administered by the financial aid office of a two-year or four-year college that you, or a qualified dependent, were enrolled as an undergraduate student. The loan must have been used solely for the purposes of paying tuition and other expenses directly related to school enrollment. Restrictions apply.
Deductible Amount of Qualified Contributory Pension Income from Another State or Political Subdivision Included in Form 1, Line 4
The state of Massachusetts allows a deduction for contributory pension income received from another state or any of its political subdivisions that do not tax such income from MA, or any of it's political subdivisions. Refer to TIR 95-9 for more information.
Claim of Right Deduction
Massachusetts taxpayers who have paid MA personal incomes taxes in a prior year on income attributed to them under a "claim of right" may deduct the amount of that income from their gross income if it later develops that they were not in fact entitled to that income, and have repaid the amounts in question.
NOTE: This deduction is allowed in the year of repayment, provided that the repayment is not considered otherwise deductible.
Some examples in which the claim of right may be applied are listed below:
- Stock under claim of ownership
- Employment contracts
- Dividends
- Corporate notes
- Mistake in validity of claim
- Advanced insurance commissions
- Repayment of unemployment compensation and supplemental unemployment benefits in a subsequent year
Commuter Deduction
You may claim a deduction for certain amounts paid for tolls through an E-Z Pass account or for weekly or monthly transit commuter passes for MBTA transit, bus, commuter rail, commuter boats, including RTA fares, bikeshare memberships, certain bicycle expenses such as improvements, purchases, and storage.
If you are filing as Single, Head of Household, or Married Filing Separately this deduction applies only to the portion that exceeds $150, and the total amount deducted may not exceed $750.
If you are filing as Married Filing Jointly, this deduction applies to the portion expended by each individual that exceeds $150, and the total amount deducted may not exceed $750 for each individual.
Deduction for Expenses of Human Organ Transplant
You may deduct certain expenses and other costs incurred in the process of donating an organ for a human organ transplant to another individual. Nonresidents are not eligible for this deduction.
You may deduct the following expenses:
- Travel expenses
- Lodging expenses, and
- Lost wages not to exceed $10,000
Certain Gambling Losses
Massachusetts now allows for a deduction for losses from wagering transactions that were incurred at a MA gambling establishment licensed in accordance with MGL Ch. 23K, or a racing meeting licensee or simulcasting licensee, only the extent of the gains from such transactions.
Prepaid Tuition or College Savings Plan Deduction
You may claim a deduction for purchases of, or contributions made to an account in a pre-paid tuition program or a college savings program established by the Commonwealth.
This deduction may not exceed $1,000 for individuals filing as Single, Married Filing Separately, or Head of Household. For individuals filing as Married Filing Jointly, this amount is $2,000. The deduction is subject to recapture if funds or distributions are used for anything other than qualified education expenses.
To enter these deductions within the program, please go to:
- State
- Massachusetts Return
- Deductions
- Prepaid Tuition or College Savings Plan Deduction
Rental Deduction
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 $4,000. Students renting a residence but have a principal residence elsewhere, do not qualify for this deduction.
To enter this deduction with in the program, please go to:
- State
- Massachusetts Return
- Deductions
- Rental Deduction
For more information and other deductions please refer to the instructions for MA Form 1.