Massachusetts tax deductions and write-offs (2026)

No. Massachusetts fully exempts military retired pay from state income tax. Other retirement income: Private pensions and 401(k)/IRA withdrawals are taxed at Massachusetts' flat rate (above any previously taxed contributions) with no general retirement exclusion.

Yes. Private pensions and 401(k)/IRA withdrawals are taxed at Massachusetts' flat rate (above any previously taxed contributions) with no general retirement exclusion.

No. Massachusetts excludes Social Security benefits from gross income. Statutory basis: M.G.L. c. 62, s. 2(a)(2)(H).

Yes: Massachusetts offers the Massachusetts Earned Income Tax Credit, 40% of the federal EITC (refundable). Married filing separately is allowed in limited cases, e.g., domestic abuse victims living apart from their spouse. Prorated for part-year residents; not available to full-year nonresidents.

Only instead of income tax: itemizers in Massachusetts pick sales tax (6.25% state rate, about 6.25% with local taxes) or state income tax, whichever is bigger. Groceries are exempt, and clothing is exempt up to $175 per item, with tax due only on the amount above $175.

Yes on your federal return if you itemize, within the $40,400 SALT cap. Massachusetts adds its own break: Renters deduct 50% of rent up to $4,000; seniors 65+ can claim the refundable Circuit Breaker credit up to $2,820 (2025).

Yes: Massachusetts offers the Rental Deduction. Deduction of 50% of rent paid on a Massachusetts principal residence, up to $4,000, available to all renters on the state income tax return whether or not they itemize. Maximum $4,000 per return ($2,000 if married filing separately); no income or age limit.

Partly: Massachusetts's motor vehicle excise is based on your vehicle's value, so it's deductible as personal property tax if you itemize. Excise is $25 per $1,000 of value, set at a fixed percentage of list price (90% in the model year down to 10% from year 5).

Massachusetts has a 5% flat rate plus a 4% surtax on income over about $1 million, and renters can deduct half their rent up to $4,000.

Yes on your Massachusetts return: $1,000 single / $2,000 joint per return. Only contributions to the state's own plan count. U.Fund/U.Plan only; deduction recaptured on distributions not used for qualified expenses, death, disability, or scholarship.

Yes: Child and Family Tax Credit: $440 per eligible dependent, with no cap on the number of dependents and no income limit. Covers dependent children under 13, dependents 65 or older, and disabled dependents or spouses. Refundable. Not available to married couples filing separately.

Yes, as a business expense: Massachusetts charges $500 ($520 online/fax) to form an LLC; ongoing: $500 annual report ($520 online). Annual report due on the anniversary of the formation date.