Massachusetts taxes most personal income at 5%, with higher rates on some capital gains and a 4% surtax on income above $1,083,150. A sole proprietor owes no separate business tax, but an LLC pays a $500 annual report fee every year. Every corporation, S corporations included, pays at least the $456 minimum excise, and C corporations pay 8% of their income.
Personal income tax
Massachusetts residents file Form 1, due April 15, 2026. You automatically get six more months to file as long as at least 80% of your tax is paid by April 15, 2026. Most income, including wages, business profit and long-term capital gains, is taxed at 5%. Short-term capital gains are taxed at 8.5% and gains on collectibles at 12%. Income above $1,083,150 pays a further 4%.
Massachusetts has no standard deduction and no itemized deductions. It gives a personal exemption instead, plus a short list of specific deductions such as half your rent, up to $4,000. Social Security is not taxed.
Low incomes owe nothing. Under No Tax Status, a single filer with Massachusetts income of $8,000 or less pays no tax, and just above that line a limited income credit softens the tax. Married couples filing separately cannot use either.
- Return
- Form 1
- Due date
- April 15, 2026
- Rates
- 5% on most income, 8.5% on short-term gains, 12% on collectibles
- Surtax
- 4% on taxable income above $1,083,150
- Personal exemption
- $4,400 single or married filing separately, $6,800 head of household, $8,800 married filing jointly
- Dependent exemption
- $1,000 each
- Blindness exemption
- $2,200 per person
- No Tax Status
- Income up to $8,000 single, $14,400 head of household, $16,400 married filing jointly, plus $1,000 per dependent for the last two
- Not taxed
- Social Security
Sole proprietor
A sole proprietor with no LLC owes Massachusetts nothing at the business level. There is no annual report with the Corporations Division and none of the $500 fee.
Your business profit is taxed on your own Form 1, at the personal rates above.
Single-member LLC
Every Massachusetts LLC files an annual report with the Secretary of the Commonwealth's Corporations Division, however few members it has. The fee is $500 a year, owed whether the business made a profit, broke even or lost money.
It is due on or before the anniversary of the day the LLC was organized, not on any tax deadline, which makes it easy to miss. The LLC's profit is taxed on your own Form 1.
Partnership
A Massachusetts partnership files Form 3, the partnership return. The profit passes through to the partners, who report it on their own returns.
S corporation
A Massachusetts S corporation files Form 355S, the S corporation excise return, due the 15th day of the third month after the year ends. The profit passes through to the shareholders, who report it on their own returns.
Unlike most states, Massachusetts still charges the S corporation itself. It pays a minimum excise of $456 whatever it earned. Once gross receipts reach $6,000,000, it also pays an excise on income: 2%, rising to 3% once receipts pass $9,000,000.
C corporation
A C corporation files Form 355, the corporate excise return, due the 15th day of the third month after the year ends. It pays 8% of the net income apportioned to Massachusetts, and never less than the $456 minimum, so a year with a loss still costs $456.
The excise also has a property or net worth part, $2.60 per $1,000, charged alongside the income part. From 2025 every corporation selling into other states counts only its Massachusetts share, measured by Massachusetts sales over total sales. Older guidance describing a three-factor formula is out of date.
- Return
- Form 355, due the 15th day of the third month after the year ends
- Excise on income
- 8% of Massachusetts net income
- Minimum excise
- $456 a year
- Property or net worth measure
- $2.60 per $1,000
- Multi-state profit
- Massachusetts sales over total sales
Estimate your state tax
Pick your business type and enter this year's numbers to see the state business tax Massachusetts charges. It assumes all your sales are in Massachusetts.
An estimate for planning, not tax advice.
Sources
- Massachusetts 2025 Form 1 instructions
- Massachusetts 2025 Form 1, resident income tax return
- mass.gov S Corporations
- mass.gov Massachusetts DOR Corporate Excise Tax Guide
- mass.gov Single Sales Factor
- mass.gov 2025 Instructions for Massachusetts Corporation Excise Return Form 355
Last reviewed August 2026.
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