Individual tax returns in Massachusetts: the 2025 and 2026 guide
The 2025 federal tax law changed a great deal for individual filers, and Massachusetts followed very little of it. These guides explain each change on both returns, side by side, so you can see what applies to your Form 1040 and what applies to your Form 1.
The federal law enacted on 4 July 2025 raised the standard deduction, lifted the cap on deducting state and local taxes to $40,000, increased the child tax credit to $2,200, and added new deductions for tips, overtime, car loan interest and people 65 and older. In June 2026, the Massachusetts Department of Revenue confirmed that the state does not follow most of those changes. Tips and overtime are fully taxed on the Form 1, there is still no standard deduction, and the senior and car loan deductions do not exist in Massachusetts.
That split runs through every guide here. Each one puts the federal rule and the Massachusetts rule next to each other, states which tax year every figure belongs to, and links to the IRS or DOR page it came from. Where Massachusetts has something the federal return does not, such as the rent deduction, the child and family credit or the senior circuit breaker, we cover that too.
The guides are grouped by what you need. Understand the rules explains the changes and the Massachusetts system. Weigh your options helps you decide whether to itemize, whether you need a preparer, and how a move, a rental or retirement changes things. Get it done covers deadlines, including extended returns due October 15, 2026, what to gather, and how working with us runs.
Understand the rules
How the rules work, federally and in Massachusetts, in plain language.
What the 2025 federal tax law changed, and what Massachusetts did not follow
The 2025 federal law added deductions for tips, overtime, seniors and car loans and raised the SALT cap. Massachusetts follows almost none of it. Side by side.
Read →The federal tips deduction, and why Massachusetts still taxes your tips
The federal deduction for qualified tips (up to $25,000, 2025 to 2028): who qualifies, the income limit, payroll tax, and why Form 1 still taxes every tip.
Read →The overtime deduction: who qualifies, the limits, and Massachusetts
The federal overtime deduction covers only the premium part of FLSA overtime, up to $12,500 ($25,000 joint), 2025 to 2028. Massachusetts taxes all overtime.
Read →The $6,000 senior deduction, plus the Massachusetts breaks for filers 65 and older
The federal $6,000 senior deduction (2025 to 2028) is not allowed in Massachusetts, but the Form 1 has its own breaks for 65 and older. Both sides explained.
Read →The Massachusetts senior circuit breaker credit: tax year 2025 limits
The Massachusetts circuit breaker credit pays up to $2,820 for 2025 to homeowners and renters 65 and older. The limits, the math, and claiming missed years.
Read →The $40,000 SALT cap: should Massachusetts homeowners itemize again?
The federal SALT cap is $40,000 for 2025 and $40,400 for 2026, reduced above $500,000 of income. What it means for Massachusetts homeowners and Form 1.
Read →Child tax credits for 2025: $2,200 federal and $440 Massachusetts
The federal child tax credit is $2,200 per child for 2025 and 2026; the Massachusetts child and family credit is $440 per eligible dependent. How the two differ.
Read →The car loan interest deduction: rules, limits, and what Massachusetts does
For 2025 to 2028, up to $10,000 of interest on a loan for a new, U.S.-assembled personal vehicle is deductible federally. Massachusetts does not allow it. The rules.
Read →Massachusetts income tax for individuals: rates, exemptions and deductions
Massachusetts taxes most income at 5%, short-term gains at 8.5% and collectibles at 12%, plus a 4% surtax. Exemptions, state-only deductions and how Form 1 differs.
Read →The Massachusetts 4% surtax: thresholds, one-time gains and married couples
The Massachusetts 4% surtax applies above $1,083,150 (2025) and $1,107,750 (2026) per return, not per person. One-time gains and joint filing are the traps.
Read →Federal tax brackets and standard deduction for 2025 and 2026
Federal income tax brackets and standard deductions for 2025 and 2026, with the corrected 2025 standard deduction of $15,750, and how Massachusetts compares.
Read →Charitable giving in 2026: the new federal rules, and what Massachusetts does
From 2026, non-itemizers can deduct up to $1,000 ($2,000 joint) of cash gifts and itemizers face a 0.5% of AGI floor. Massachusetts follows neither rule.
Read →
Weigh your options
Comparisons, checklists and the questions that decide which way to go.
Do I need someone to prepare my taxes this year?
An honest self-check: when tax software is enough for your federal and Massachusetts returns, and the situations where paying a preparer is worth it.
Read →Tax software vs. a local tax preparer: an honest comparison
Cost, time, error risk and who answers when a letter arrives: how tax software and a local preparer compare for a federal and Massachusetts individual return.
Read →Itemize or take the standard deduction? The 2025 math for Massachusetts homeowners
With the SALT cap at $40,000 for 2025, many Massachusetts homeowners should compare itemizing with the $31,500 joint standard deduction. A worked example.
Read →Moving in or out of Massachusetts? How Form 1-NR/PY works
Moved into or out of Massachusetts, or earned Massachusetts income while living elsewhere? You file Form 1-NR/PY. Income, prorated exemptions and credits.
Read →Life events that change your tax return, and what to do before filing
Marriage, a new baby, a home sale, retirement, a move or the death of a spouse: how each changes your federal and Massachusetts returns, and what to gather first.
Read →Owning a rental in Massachusetts: what changes on your 1040 and Form 1
Rental income goes on Schedule E federally and is taxed at 5% in Massachusetts. Depreciation, owner-occupied two-families, and where the two returns differ.
Read →Retiree tax returns in Massachusetts: pensions, IRAs and Social Security
Massachusetts does not tax Social Security or many government pensions, and treats IRA withdrawals differently from federal. What retirees should know.
Read →
Get it done
Deadlines, what to gather, and how working with us actually runs.
Filed an extension? What to do before October 15, 2026
Extended 2025 federal and Massachusetts returns are due October 15, 2026. Check your Massachusetts extension is valid, what penalties apply, and what to do now.
Read →Individual tax deadlines from October 2026 to spring 2027, federal and Massachusetts
Federal and Massachusetts individual tax dates from October 15, 2026 through the 2027 filing season, including the January estimate and how April due dates are set.
Read →Tax document checklist for your 2026 return, federal and Massachusetts
What to gather for your 2026 Form 1040 and Massachusetts Form 1, including the new tips, overtime, car loan and Trump account items and state-only records.
Read →What does individual tax preparation cost? What actually drives the fee
What drives the fee for preparing a federal and Massachusetts individual return, flat versus hourly pricing, and the fee arrangements the IRS warns you to avoid.
Read →
Quick answers
- Does Massachusetts follow the 2025 federal tax changes?
- Mostly not. In TIR 26-4, issued 23 June 2026, Massachusetts DOR said the state does not conform to the federal deductions for tips, overtime, car loan interest or seniors, the higher SALT cap, the new charitable rules or Trump accounts. It does follow a few narrower changes, including expanded 529 plan expenses and the new limit on gambling losses.
- When are extended 2025 returns due?
- October 15, 2026, for both the federal Form 1040 and the Massachusetts Form 1. The Massachusetts extension is only valid if at least 80% of your 2025 Massachusetts tax was paid by April 15, 2026. Neither extension gave extra time to pay, so interest and late-payment penalties have been running on any unpaid balance since April 15.
- Are tips and overtime tax-free now?
- No. For 2025 through 2028, qualifying workers can deduct up to $25,000 of tips and up to $12,500 of overtime premium ($25,000 joint) on the federal return, subject to income limits. Social Security and Medicare tax still apply, and Massachusetts taxes all tips and overtime in full at 5%.
- Does Massachusetts have a standard deduction?
- No. Massachusetts does not allow the federal standard deduction or federal itemized deductions. It uses personal exemptions instead: $4,400 single, $6,800 head of household and $8,800 married filing jointly, plus exemptions for dependents, age 65 and blindness, and its own deductions such as rent and 529 contributions.
- How much does it cost to have Murphy prepare my return?
- It depends on the schedules, states and records involved, so we don't publish a single price. After a short conversation and a look at last year's returns, we give you a scope and a price in writing before anything starts.
Get an answer for your situation, not a general one.
These pages cover what applies broadly. What applies to you depends on your own facts — which is a conversation rather than an article.
Please don't send Social Security numbers or tax documents through this form.