Massachusetts ‘Millionaires’ Tax
Effective January 1, 2023, Massachusetts taxpayers with incomes over $1 million will be taxed an additional 4% on the portion of annual income that exceeds $1 million. This tax applies to both earned and investment income within the state. This brings the Massachusetts income tax rates to 5% on income up to $1 million, and 9% on income earned over $1 million. The $1 million threshold will be indexed annually for inflation following the federal adjustments.
This surtax resulted from a change in November 2022, when the State of Massachusetts voted to amend the state constitution. Voters said ‘yes’ to the Fair Share Amendment, which is expected to generate a projected $2 billion in tax revenue aimed at helping fund state transportation and public education needs, including subsidized lunch programs.
To learn more about what this means to you, please contact one of our advisors.
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