Massachusetts Taxable Gross Income
Massachusetts gross income includes various types of income that are subject to state income tax. The definition is broad and encompasses many forms of compensation and earnings, even those not taxed at the federal level.
What Constitutes Massachusetts Gross Income?
- All wages, salaries, tips, bonuses, fees, and other compensation
- Taxable pensions and annuities
- Pension income from another state or political subdivision before any deduction
- Taxable IRA/Keogh and Roth IRA distributions
- Taxable alimony (refer to Schedule X instructions)
- Income from a business, trade, profession, partnership, S corporation, trust, or estate
- Rental, royalty, and REMIC income
- Unemployment compensation
- Taxable interest and dividends
- Gambling winnings
- Capital gains
- Forgiveness of debt and mortgage forgiveness
- Taxable portion of fellowships and scholarships
- Any other income not specifically exempt
Additional Inclusions Not Subject to Federal Tax
Massachusetts gross income also includes income that is not subject to U.S. income tax, such as:
- Interest from obligations of states and their political subdivisions (other than Massachusetts and its political subdivisions)
- Interest and dividends derived from or connected with Massachusetts business activity, or ownership of Massachusetts real estate or tangible personal property
- Gain from the sale of a business or an interest in a business
- Separation, sick, or vacation pay
- Deferred compensation
- Income from covenants not to compete
- Nonqualified pension income that federal law allows states to tax
Important Notes for Taxpayers
- For nonresident or part-year residents, ensure you fill in the appropriate return category (e.g., Form 1-NR/PY) and report income earned while residing in Massachusetts.
- Use the correct mailing address for tax returns: Massachusetts Department of Revenue, PO Box 7003, Boston, MA 02204-7003.
- If using tax software, verify the correct PO box is selected.
- For estimated tax payments, refer to Form 1-ES.
Source:
Form 1 Instructions
Form 1-NR/PY Instructions
Disclaimer: Always verify information with official Federal or State Department of Revenue Forms and Instructions.