Massachusetts has made the following changes to the tax laws for the 2024 tax year:
2024 Personal Income Tax Rates
- Effective for tax years beginning on or after January 1, 2020, the tax rate on most classes of taxable income has been changed to 5%. Long-term gains from the sale/exchange of collectibles is subject to a tax rate of 12%. The tax rate on short-term gains on capital assets is 8.5%.
Annual Update of Circuit Breaker Tax Credit
- Massachusetts has done an annual update on the income thresholds for the Senior Circuit Breaker Tax Credit. Your total income cannot exceed $72,000 for single filers, $91,000 for a head of household filer, and $109,000 for joint filers. Maximum credit for 2024 is $2,730.
Child and Family Tax Credit
- There is an increase in the credit to $440 from a previous $310, starting on January 1, 2024, with no limit on the number of individuals who may qualify.
Deduction of Interest from Massachusetts banks
- A prior deduction of up to $100 per individual or up to $200 for joint filers for interest from Massachusetts banks has been repealed, effective January 1, 2024.
Joint Filing Requirements
- Beginning January 1, 2024, married couples who file a federal joint return must file a Massachusetts joint return. Certain exceptions may apply.
Filing Deadline
- Massachusetts Form 1 and any state tax payments are due on or before April 15, 2025.
4% Surtax
- For 2024, the 4% Surtax applies to income over $1,053,750. This is up from $1,000,000 in 2023.
Failure to Obtain Health Insurance Penalty
- For 2024, individuals over the age of 18 must obtain health insurance that meets the Minimum Creditable Coverage (MCC) as defined by MA Health Connector. Penalties are imposed monthly and based upon monthly insurance premiums that the individual would have qualified for.
Septic Credit Expansion
- Starting January 1, 2024, qualifying expenses have expanded to include upgrades and sewer connections to satisfy Title 5 Environmental code or a watershed permit from the Department of Environmental Protection. See TIR 24-14 for additional information on expansion.
For more details on new changes, please click here.