Massachusetts has a flat state income tax rate of 5%, one of the highest in the nation.
However, the state also imposes an additional 4% surtax on income over $1 million, resulting in a top marginal rate of 9% for high earners.
Massachusetts does not have any local or municipal income taxes, unlike some other states.
Federal income tax withholding can range from 10% to 37% depending on your taxable income and filing status.
Social Security and Medicare taxes together account for 7.65% of your gross pay.
Massachusetts requires employers to withhold a Paid Family and Medical Leave (PFML) tax of up to 0.68% from employee paychecks.
Residents can claim various deductions and credits, such as a rental deduction and a tax credit for dependent care expenses, which can lower their overall tax burden.
Self-employed individuals in Massachusetts are responsible for paying both the employee and employer portions of Social Security and Medicare taxes, amounting to 15.3% of their net earnings.
Massachusetts does not have a sales tax on most groceries, prescription drugs, or clothing items under $175, but the standard sales tax rate is 6.25%.
The state has a relatively high property tax rate, with an average effective rate of 1.20% statewide.
Massachusetts imposes a gas tax of 24 cents per gallon, one of the higher rates in the country.
The state's progressive income tax structure means that higher-income earners can see a larger percentage of their paychecks go towards state taxes.
Massachusetts offers various tax credits and deductions, such as the Earned Income Tax Credit (EITC) and the state's own Child Tax Credit, which can provide significant savings for low- and middle-income taxpayers.
The state's estate tax applies to estates valued at $1 million or more, with a top rate of 16%.
Massachusetts has a use tax, which requires residents to pay sales tax on purchases made from out-of-state sellers, even if no sales tax was collected at the time of purchase.
The state's capital gains tax rate can be as high as 12%, depending on the type of investment and holding period.
Employers in Massachusetts are required to withhold state unemployment insurance taxes, which can range from 0.94% to 5.42% of the first $15,000 in wages.
Massachusetts has a 0.62% workforce training contribution tax, which helps fund job training and workforce development programs.
The state's Charitable Contribution Tax Credit allows taxpayers to claim a credit of up to 50% of their charitable donations, up to a maximum of $1,000 for single filers and $2,000 for joint filers.
Massachusetts has a flat-rate personal income tax, but the state also imposes an additional "millionaire's tax" of 4% on income over $1 million, resulting in a top marginal rate of 9% for high earners.