Massachusetts Individual Income Tax Instructions
Extracted from PDF file 2021-massachusetts-form-1-instructions.pdf, last modified January 2022
Individual Income Tax InstructionsDepartment of Revenue Commonwealth of Massachusetts Form 1 2021 Massachusetts Resident Income Tax e l i F e / v o g . s s a M Before using paper, consider Fast — Filing electronically, rather than on paper, can mean much faster processing of your refund and money in your account sooner. Accurate — Generally, there are fewer errors with electronic filings than paper forms. Online programs make it easy to ensure that you don’t miss anything important. Ecofriendly — A great majority of Massachusetts taxpayers file electronically. Help us to continue reducing our carbon footprint. Affordable — About 70% of Massachusetts taxpayers qualify to use commercial tax preparation software at no charge. Or, you may have the option to file through MassTaxConnect for free. Give E-file a try this year! C’mon, admit it — filing paper tax returns is no fun! So forget about longer refund wait times and calculation mistakes. E-file this year! There are three easy and convenient ways to do it. 1 2 3 File Electronically for Free Approximately 70% of Massachusetts taxpayers likely qualify to file both federal and state returns for free, enhanc ing fraud protection and cutting down on identity theft. Massachusetts joined the Free File Alliance, a nonprofit partnership between tax preparation companies, the IRS and the states to increase opportunities for taxpayers to E-file their tax returns for free. Check out the free filing options available to taxpayers at mass.gov/efile. You may also be able to file your tax return online through DOR's MassTaxConnect. You qualify for this option if you were a Massachusetts resident for the entire 2021 tax year, previously filed a Massachusetts return, and the forms you file are supported by the program. Commercial Tax Preparation Software You can also E-file using commercial tax filing products. Visit our website for a complete listing of approved products. Although some of these products offer a paper filing option, you may only use that option if it incorporates a 2D barcode in the right-hand corner of all pages. If you have a 2D printing issue, be sure to contact the software manufacturer for instructions before filing to avoid having your return rejected. Also, be sure to use the correct 2D barcode mailing address: PO Box 7000 for refunds/no payments or PO Box 7003 for payments. See DOR’s online tax form instructions for more information. Tax Preparers The majority of paid tax preparers recognize that their clients don’t want mistakes, delays, or longer refund times so they offer E-filing for their customers. Moreover, Massachusetts law requires any preparer who completes more than 10 Massachusetts income tax returns to E-file (TIR 11-13 has a specific taxpayer opt-out provision to this law). Preparers who do file paper returns for their clients have specific requirements they must meet to avoid paying penalties and fines. You’ll find a list of preparers on the DOR website. You may qualify for assistance with preparing your tax returns. Check out options at mass.gov/taxassistance. mass.gov/efile 2021 Form 1 Instructions 3 Major 2021 Tax Changes but for a Pandemic-Related Circumstance will be treated as Massachusetts source income subject to Massachusetts personal income tax. The state of emergency was terminated by Executive Order effective June 15, 2021, and the foregoing rule only applied during the state of emergency and for 90 days after its conclusion. Additionally, in consideration of the fact that other states have adopted similar sourcing rules, for tax year 2021 Massachusetts residents who immediately prior to the Massachusetts COVID19 state of emergency were employees engaged in performing services from a location outside of Massachusetts, and who began performing such services in Massachusetts due to their employing state’s COVID-19 state of emergency or other Pandemic-Related Circumstance, will be eligible to claim a credit for taxes paid to that other state, to the extent generally provided under Massachusetts law. For more information about this change, see TIR 20-15. This credit replaces the Dependent Care Deduction for employment related expenses incurred in caring for dependents, which was repealed for tax years beginning on or after January 1, 2021. Penalty for Failure to Obtain Health Insurance For tax years beginning on or after January 1, 2020, individuals subject to tax under MGL ch 62 that are primarily engaged in cranberry production may be eligible for a Cranberry Bog Renovation Tax Credit (CBRTC), which is equal to 25% of the taxpayer’s total qualified renovation expenditures incurred for the qualified renovation of a cranberry bog for the cultivation, harvesting or production of cranberries. The CBRTC is refundable but is not transferrable. However, in lieu of claiming the CBRTC as a refundable tax credit, the taxpayer may carryover unused CBRTC for the next 5 years. For more up-to-date and detailed information on (i) tax changes and federal conformity, (ii) the Department of Revenue’s response to the COVID-19 pandemic, and (iii) to view all of the public written statements referenced in these instructions, please visit mass.gov/dor. Filing Due Dates For tax year 2021, Form 1 must be filed on or before April 19, 2022. Because of the observance of Emancipation Day in Washington D.C. on Friday, April 15, 2022, federal returns otherwise due on April 15 will generally be treated as timely if filed by Monday, April 18, 2022. However, Monday, April 18, 2022, is Patriot’s Day, a legal holiday in the Commonwealth of Massachusetts. Therefore, Massachusetts personal income tax returns and payments with a due date of April 15, 2022, shall be treated as timely if filed and paid on or before April 19, 2022. 2021 Personal Income Tax Rates Effective for tax years beginning on or after January 1, 2020, the tax rate on most classes of taxable income is changed to 5%. The tax rate on short-term gains from the sale or exchange of capital assets and on long-term gains from the sale or exchange of collectibles (after a 50% deduction) remains at 12%. Expansion of Certain Electronic Filing and Payment Requirements TIR 21-9 announced the expansion of electronic filing and payment requirements for certain tax types. The changes for partnerships and fiduciaries are effective for tax periods ending on or after December 31, 2021, and for payments made on or after January 1, 2022. It also announced an expansion of the Department’s two-dimensional (“2D”) bar code requirements for paper forms produced by tax preparation software programs effective for tax periods ending on or after December 31, 2021. Revised Guidance on the Massachusetts Tax Implications of an Employee Working Remotely due to the COVID-19 Pandemic In response to the COVID-19 pandemic, several states, including Massachusetts, declared a state of emergency, and many businesses implemented work-from-home requirements for their employees in response to government orders and public health recommendations. Due to Massachusetts’ COVID-19 state of emergency, all compensation paid for services performed prior to September 16, 2021, to non-residents who would generally perform such services in Massachusetts Massachusetts requires most adults 18 and over with access to affordable health insurance to obtain it. In 2021, individuals must be enrolled in health insurance policies that meet minimum creditable coverage standards defined in regulations adopted by the Commonwealth Health Insurance Connector Authority (Health Connector). Individuals who are deemed able to afford health insurance but fail to obtain it are generally subject to penalties in Massachusetts for each month of noncompliance in the tax year. The monthly penalties, which will be imposed through the individual’s personal income tax return, are set out in Technical Information Release (TIR) 21-1 and are based on half of the minimum monthly insurance premium for which an individual would have qualified through the Health Connector. Dependent Care Tax Credit Starting with the 2021 tax year, individuals subject to tax under MGL ch 62 are eligible to receive a Dependent Care Tax Credit (DCTC) equal to employment-related expenses for the care of a qualified child under the age of 13, a disabled dependent, or a disabled spouse. To claim the credit a taxpayer must be eligible for the federal Dependent Care Tax Credit allowed under IRC § 21. For taxpayers filing a joint U.S. Form 1040 that are filing separately for Massachusetts purposes, either spouse may claim the DCTC he or she incurred, but their combined DCTC cannot exceed $240 for one qualifying individual or $480 for two or more qualifying individuals. The DCTC is refundable but is not transferrable. A taxpayer claiming the DCTC may not also claim the Household Dependent Tax Credit. Household Dependent Tax Credit Starting with the 2021 tax year, individuals subject to tax under MGL ch 62 may claim the Household Dependent Tax Credit (HDTC) if they maintain a household as provided under IRC § 21 that includes a dependent that qualifies as a dependent under IRC § 152 and who is under the age of 12, age 65 or over, or is disabled. The amount of the HDTC is $180 if the taxpayer has one dependent or $360 if the taxpayer has two or more dependents. A taxpayer claiming the HDTC may not also claim the Dependent Care Tax Credit. This credit replaces the deduction for household dependents, which was repealed for tax years beginning on or after January 1, 2021. Cranberry Bog Renovation Tax Credit Disability Hire Tax Credit For tax years beginning on or after January 1, 2023, businesses subject to tax under MGL ch 62 that hire employees with a disability who live and work in Massachusetts may be eligible for a Disability Hire Tax Credit (DHTC). The credit is equal to the lesser of $5,000 or 30% of the wages paid to a qualified employee in the first year of employment, and the lesser of $2,000 or 30% of the wages paid to a qualified employee in each subsequent year of employment. To qualify for the DHTC, the employee must be certified by the Massachusetts Rehabilitation Commission as being disabled under the federal American Disabilities Act, 42 USC § 12102, be capable of working independently, have a mental or physical disability that constitutes or results in a substantial impediment to employment, be hired after July 1, 2021, and be employed by the business for at least 12 consecutive months prior to and in the taxable year in which the DHTC is claimed. The business must be certified by the Massachusetts Rehabilitation Commission. The DHTC is refundable but is not transferrable. 2021 Form 1 Instructions New Optional Pass-Through Entity Excise For taxable years beginning on or after January 1, 2021, pass-through entities, including S-corporations, partnerships, and certain trusts may elect to pay an optional 5% excise on the income that flows through to shareholders, partners, or beneficiaries subject to the personal income tax. The shareholders, partners, or beneficiaries of the pass-through entity may claim a nontransferable, refundable credit equal to 90% of their allocable share of the entity’s excise due. The credit may be claimed in the taxable year in which the passthrough entity’s taxable year ends. Annual Update of Circuit Breaker Tax Credit Taxpayers age 65 or older who own or rent residential property located in Massachusetts are allowed a credit equal to the amount by which their real estate tax payments, or 25% of the rent constituting a real estate tax payment, exceeds 10% of the taxpayer’s total income, not to exceed $1,170. The amount of the credit is subject to limitations based on the taxpayer’s total income and the assessed value of the real estate, which for tax year 2021 must not exceed $884,000. For purposes of calculating the credit, total income and maximum credit thresholds are adjusted annually. For tax year 2021, an eligible taxpayer’s total income cannot exceed $62,000 in the case of a single filer who is not a head of household filer; $78,000 for a head of household filer; and $93,000 for joint filers. To qualify for the credit, a taxpayer must be age 65 or older and must occupy the property as his or her principal residence. See TIR 21-11 for more information. Employer-Provided Parking, Transit Pass, and Commuter Highway Vehicle Benefits Exclusion Amounts Massachusetts adopts Internal Revenue Code (“IRC”) § 132(f) as amended and in effect on January 1, 2005, which excludes from an employee’s gross income (subject to a monthly maximum) employer-provided parking, transit pass, and commuter highway vehicle transportation benefits. For tax year 2021, the IRS has calculated, based on inflation adjustments contained in IRC § 132(f) as effective on January 1, 2005, the 2021 monthly exclusion amounts of $275 for employer-provided parking and $140 for combined transit pass and commuter highway vehicle transportation benefits. Massachusetts adopts these 2021 monthly exclusion amounts as they are based on the IRC as effective on January 1, 2005. See TIR 20-16. Taxation of Unemployment Compensation Received in 2020 and 2021 On April 1, 2021, “An Act financing a program for improvements to the Unemployment Insurance Trust Fund and providing relief to 4 employers and workers in the Commonwealth” (the “UI Trust Fund Act”) was signed into law. Section 26 of the UI Trust Fund Act, provides that, for the taxable years beginning on January 1, 2020 and January 1, 2021, up to $10,200 of unemployment compensation that was or is included in a taxpayer’s federal gross income shall be deducted from federal gross income for purposes of determining Massachusetts gross income for taxpayers, whose household income is not more than 200% of the federal poverty level. The deduction is not limited to $10,200 per return, rather, a deduction of up to $10,200 may be claimed by each eligible individual for unemployment compensation received by that individual. Taxpayers who already filed their 2020 personal income tax returns and reported unemployment compensation as income should not file amended returns at this time. DOR will send notices to taxpayers who reported unemployment to explain whether those persons may be eligible for relief. See TIR 21-6 for more information. Section 8 of the UI Trust Fund Act provides that until January 1, 2022, no penalty shall be assessed against a taxpayer solely for failure to remit taxes imposed on unemployment compensation received during the 2020 tax year (i.e., unemployment compensation in excess of $10,200). See TIR 21-6 for more information. Delay in reinstatement of the personal income tax deduction for charitable contributions The Massachusetts charitable deduction, which has been suspended since the 2002 tax year, was scheduled to be reinstated for tax years beginning on or after January 1, 2021. However, this reinstatement has been delayed, and will be available for tax years beginning on or after January 1, 2023. See TIR 21-4 for additional information. Small Business Loan Forgiveness Section 1106 of Public Law 116-136, the Coronavirus Aid, Relief, and Economic Security Act (the CARES Act) provides loan forgiveness to small businesses for certain loans made pursuant to the Paycheck Protection Program (“PPP”) under the Small Business Act. Furthermore, any amount of cancelled indebtedness resulting from these loans that would otherwise be includable in the gross income for federal income taxes will be excluded from federal gross income. Section 12 of the UI Trust Fund Act provides a deduction for cancellation of debt (“COD”) income related to forgiven PPP loans made under § 1102(a) of the CARES Act. The deduction applies to the taxable year beginning January 1, 2020. PPP loan borrowers subject to the Massachusetts personal income tax, including Schedule C filers, certain partners in a partnership, and S corporation shareholders should not include in Massachusetts gross income the amount of a PPP loan forgiven under § 1106(b) of the CARES Act during the 2020 tax year. Taxpayers who have already filed their 2020 personal income tax returns and included forgiven PPP loans in Massachusetts gross income should file an amended return to exclude these amounts. See TIR 21-6 for more information. Consistent with the federal rules, a deduction is allowed for otherwise deductible expenses that are paid with the proceeds of a PPP loan that is forgiven. See TIR 21-6 for more information. Taxation of Certain Federal COVIDRelated Relief Payments Section 12 of the UI Trust Fund Act provides that (i) the amount of any advance received as an Economic Injury Disaster Loan pursuant to § 1110(e) of the CARES Act; (ii) the amount of any Small Business Administration payment described in § 1112(c) of the CARES Act; and (iii) the amount of any funding received as an Economic Injury Disaster Loan pursuant to § 331 of the federal Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act should be deducted from federal gross income for purposes of determining Massachusetts gross income for taxable years beginning January 1, 2020 and January 1, 2021. Accordingly, taxpayers who received such federal payments in 2020 or 2021 should exclude these amounts from their Massachusetts gross income. Taxpayers who have already filed their 2020 personal income tax returns and included such federal payments in taxable income should file an amended return to exclude these amounts. See TIR 21-6 for more information. Changes Related to Federal Tax Reform As a general rule, Massachusetts does not adopt any federal personal income tax law changes incorporated into the IRC after January 1, 2005. However, certain specific Massachusetts personal income tax provisions, as set forth in MGL c. 62, § 1(c), automatically conform to the current IRC. The provisions of the IRC Massachusetts adopts on a current basis are: ◗ Roth IRAs; ◗ IRAs; ◗ The exclusion for gain on the sale of a principal residence; ◗ Trade or business expenses; ◗ Travel expenses; ◗ Meals and entertainment expenses; ◗ The maximum deferral amount of government employees’ deferred compensation plans; ◗ The deduction for health insurance costs of self-employed taxpayers; 2021 Form 1 Instructions ◗ Medical and dental expenses; ◗ Annuities; ◗ Health savings accounts; ◗ Employer-provided health insurance coverage; ◗ Amounts received by an employee under a health and accident plan; and ◗ Contributions to qualified tuition programs. See TIRs 98-8, 02-11, 02-18, 07-4 and 09-21 for further details. In recent years there have been a few federal acts that have had significant impacts on the Massachusetts personal income tax. Most recently, the enactment of (i) the Federal Consolidated Appropriations Act, 2021 omnibus legislation, which includes the COVID-Related Tax Relief Act of 2020 and the Taxpayer Certainty and Disaster Tax Relief Act of 2020, and (ii) the American Rescue Plan Act of 2021 on December 27, 2020, resulted in several modifications to the Massachusetts personal income tax including (1) an expansion of the federal EITC that impacts the calculation of the Massachusetts EITC, (2) the timing of inclusion in gross income of withdrawals from certain retirement accounts, (3) an exclusion from gross income of a federal tax credit, (4) an exclusion from gross income of discharges of certain student loans, and (5) an exclusion from gross income of child tax credits, (6) a modification to the depreciation period for certain residential rental property from 40 years to 30 years, (6) the treatment of debt forgiven and expenses incurred pursuant to PPP loans, (7) the treatment of expenses paid using proceeds form Shuttered Venue Operator Grants or Restaurant Revitalization Grants, (8) an expansion of the limitation on the deduction of executive compensation paid by publicly traded corporations, and (9) a temporary allowance for businesses to deduct as a business expense the full amount of the cost of food and beverages provided by a restaurant. For more information see Working Draft TIR 21-XX: Massachusetts Tax Implications of Selected Provisions of the Federal Consolidated Appropriations Act, 2021 and the American Rescue Plan Act of 2021. Prior to that, in 2017 and 2020, Public Law 11597, commonly known as the Tax Cuts and Jobs Act (“TCJA”), and the CARES Act, also provided for federal changes to a variety of provisions in the IRC that affect the Massachusetts personal income tax. Included among these are changes to the tax treatment of certain medical expenses incurred, treatment of income generated by U.S. individual shareholders of a controlled foreign corporation (CFC), modifications to the tax treatment of retirement funds, plans, and accounts, increases to the allowable charitable deduction, exclusion of certain employer payments from taxable income, and changes to depreciation scheduled and loss limitations. For more information 5 about the TCJA’s and CARES Act’s changes, see DOR’s public written guidance, including TIRs 1814, 19-6, 19-7, 19-11, and 20-9. What Is Gross Income? For more information on the differences between federal and Massachusetts income tax rules, please see: ◗ All wages, salaries, tips, bonuses, fees and other compensation; mass.gov/info-details/differences-between-massachusetts-state-tax-law-and-federal-tax-law-for-personal-income ◗ Pension income from another state or political subdivision before any deduction; Privacy Act Notice Under the authority of 42 USC § 405(c)(2)(C)(i), and MGL ch 62C, § 5, DOR has the right to require an individual to furnish his or her Social Security number on a state tax return. This information is mandatory. DOR uses Social Security numbers for taxpayer identification to assist in processing and keeping track of returns and in determining and collecting the proper amount of tax due. Under MGL ch 62C, § 40, the taxpayer’s identifying number is required to process a refund of overpaid taxes. Although tax return information is generally confidential pursuant to MGL ch 62C, § 21, DOR may disclose return information to other taxing authorities and those entities specified in MGL ch 62C, §§ 21, 22 or 23, and as otherwise authorized by law. Filing Your Massachusetts Return If you were a resident of Massachusetts and your gross income was more than $8,000 — whether received from sources inside or outside of Massachusetts — you are required to file a Massachusetts income tax return. If your gross income was $8,000 or less, you do not need to file a return. If you did not live in Massachusetts but received Massachusetts source income in excess of your personal exemption amount multiplied by the ratio of your Massachusetts income to your total income, you must file as a nonresident on the Nonresident/Part-Year Resident Income Tax Return, Form 1-NR/PY. If, during the taxable year, you either moved to Massachusetts or terminated your status as a Massachusetts resident to establish residency outside the state, and your gross income was more than $8,000 — whether received from sources inside or outside of Massachusetts — you must file as a part-year resident on the Form 1-NR/PY. Massachusetts gross income includes the following: ◗ Taxable pensions and annuities; ◗ Taxable IRA/Keogh and Roth IRA distributions; ◗ Alimony; ◗ 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; ◗ Mortgage forgiveness; ◗ Taxable portion of scholarships and fellowships; and ◗ Any other income not specifically exempt. Massachusetts gross income also includes the following, which are not subject to U.S. income tax: ◗ Interest from obligations of states and their political subdivisions, other than Massachusetts and its political subdivisions; and ◗ Income earned by a resident from foreign employment. Massachusetts gross income does not include: ◗ Interest on obligations of the U.S. and U.S. territories; ◗ Pension income received from a contributory annuity, pension, endowment or retirement fund of the U.S. government or the Commonwealth of Massachusetts and its political subdivisions. ◗ Amounts received as U.S. Social Security, public welfare assistance, Veterans Administration disability payments, G.I. Bill education payments, certain worker’s compensation, gifts, accident or life insurance payments, or certain payments received by Holocaust survivors; and ◗ Compensation earned by members of the armed forces for service in a combat zone (excluded to the same extent as under federal law). Am I a Resident, Nonresident, or Part‑Year Resident? There are four different categories of resident status under Massachusetts tax law: ◗ You are a full-year resident if your residence (domicile) is in Massachusetts or if you maintain 2021 Form 1 Instructions 6 a permanent place of abode in Massachusetts and during the year spend more than 183 days, in the aggregate, in the state. If you fit this description you should file a Massachusetts Resident Income Tax Return, Form 1. What Are the Rules for Filing a Joint Return? ◗ You are a nonresident if you were not a resident of Massachusetts but earned Massachusetts income (e.g., from a job in Massachusetts). You must report such income by filing a Massachusetts Form 1-NR/PY. If your spouse died during 2021, you may still choose to file a joint return. ◗ You are a part-year resident if you either moved into or moved out of Massachusetts during the taxable year. In this case, you must reduce certain income, deductions and exemptions based on the number of days you were a resident or on the amount of your income that is subject to Massachusetts tax. Part-year residents must file a Massachusetts Form 1-NR/PY. ◗ You are both a nonresident and part-year resident if you meet the criteria above for both the part-year resident and nonresident categories. If filing as a nonresident and part-year resident, the Schedule R/NR must be completed. Are Military Personnel Required to File? If you enlisted in the service as a Massachusetts resident and have not established a new domicile (residence) elsewhere (refer to military guidelines), and if your gross income is more than $8,000, you are required to file a Massachusetts resident income tax return. This applies even though you may be stationed outside of Massachusetts. The words residence and domicile are used to denote the place where you have your permanent home and to which, whenever you are absent, you have the intention of returning. Nonresident military personnel stationed in Massachusetts may be subject to Massachusetts taxes and should file Form 1-NR/PY if they earn income from outside military sources. Military Spouses. The Military Spouses Residency Relief Act (P.L. 111‑97) prohibits a service-member’s spouse from either losing or acquiring a residence or domicile for purposes of taxation because of being absent or present in any U.S. tax jurisdiction solely to be with the servicemember in compliance with the servicemember’s military orders. In general, for Massachusetts tax purposes, the law affects only servicemembers and their spouses who are domiciled in a state other than Massachusetts. Under federal law, a military spouse is allowed, in some circumstances, to elect to use the same residence for purposes of taxation as the servicemember regardless of the date on which the marriage of the spouse and the servicemember occurred. For further information on the Massachusetts implications of the federal law, see TIR 19-14. A joint Form 1 is not allowed if both spouses were not Massachusetts residents for the same portion of 2021. If you are legally married, you have the option of filing either a joint return or a married filing separate return. Married taxpayers who file a joint return are allowed to claim the following exemptions, deductions and credits which married taxpayers filing separate returns may not claim: ◗ A credit of $180 ($360 for two or more dependents) for a dependent member of household under age 12, or dependent age 65 or over as of December 31, 2021 (not you or your spouse) or a disabled dependent; ◗ No Tax Status if joint Massachusetts AGI was $16,400 or less plus $1,000 for each dependent; ◗ Limited Income Credit if joint Massachusetts AGI is between $16,400 and $28,700 plus $1,750 for each dependent; ◗ Excess unused exemptions against interest income (other than interest from Massachusetts banks), dividends or capital gain income; and ◗ A senior circuit breaker tax credit allows senior citizens meeting certain eligibility criteria to claim a refundable credit on their state income taxes for the real estate taxes paid on the Massachusetts residential property they own or rent, and which they occupy as their principal residence. The credit is the amount by which the real estate tax payment or 25% of the rent constituting real estate tax payments exceeds 10% of their total income, but not more than $1,170. The credit is refundable to the extent the credit exceeds the taxpayer’s tax liability. How Do I File a Decedent’s Return? A final income tax return must be filed for a taxpayer who died during the taxable year. This return should include income received until date of death. It must be signed and filed by his/her personal representative, administrator or surviving spouse for the portion of the year before the taxpayer’s death. Be sure to fill in oval 1 if the taxpayer who was listed first on last year’s income tax return is deceased, or oval 2 if the taxpayer who was listed second on last year’s income tax return is deceased. Also, enclose Form M-1310, Statement of Claimant to Refund Due on Behalf of Deceased Taxpayer, with the refund claimant’s name and Social Security number clearly printed. A joint return may be filed by a surviving spouse. In the case of the death of both spouses, a final return must be filed by their legal representative. Any income of $100 or more received for the decedent for the taxable year after the decedent’s death, and for succeeding taxable years until the estate is completed, must be reported each year on Massachusetts Form 2, Massachusetts Fiduciary Income Tax Return. Form 2 is available online at mass.gov/dor. If the decedent’s return shows a refund due, and if the Probate Court has not appointed a legal representative and none is contemplated, a Massachusetts Form M-1310 must be enclosed with the return so the refund check may be made payable to the proper person. Should I Make Estimated Tax Payments in 2022? Every resident or nonresident who expects to pay more than $400 in Massachusetts income tax on income which is not covered by Massachusetts withholding must pay Massachusetts estimated taxes. Estimated tax payments can be made online by using MassTaxConnect at www.mass.gov/ masstaxconnect or by filing Massachusetts Form 1-ES. See line 40 instructions and TIR 04-25 for more information. When to File Your Return Your 2021 Massachusetts Form 1 is due on or before April 19, 2022. Automatic Extensions All taxpayers filing personal income tax returns are automatically granted a six-month extension of time to file their tax return as long as at least 80% of the total amount of tax ultimately due on or before the due date prescribed for payment of the tax has been paid. See TIR 16-10. Also, if you are making a payment of $5,000 or more, you are required to submit your extension payment electronically. Failure to do so will result in a penalty. If you are making a payment of less than $5,000, you also have the option of filing your extension electronically. If there is a tax due with your extension, payment can be made through Electronic Funds Withdrawal. Form 1 Extension Worksheet 1. Enter amount from Form 1, line 32 . . . . . . . . . . . 2. Enter the total of Form 1, lines 38 through 40 and 43 through 47 . . . . . . . . . . . . . . 3. Amount due. Subtract line 2 from line 1, not less than 0. . . . . . . . . . . . . . . . . . continue on next page ... 2021 Form 1 Instructions Note: Your extension will not be valid if you fail to pay 80% of your total tax liability through withholding, estimated tax payments or with your extension. Must I File on a Calendar Year Basis? No. You may file on a fiscal year basis if you keep your books and records on that fiscal year basis and if you receive permission from the Commissioner of Revenue. If you file on a fiscal year basis, you must file on or before the fifteenth day of the fourth month after the end of your fiscal year. Taxpayers filing on a fiscal year basis must complete and file Form 13, Notice of Designation of Fiscal Year, available at mass.gov/dor or by calling (617) 887-6367 or toll-free in Massachusetts (800) 392-6089. Fiscal Year Filers File the 2021 return for calendar year 2021 and fiscal years that began in 2021 and ended in 2022. For a fiscal year return, fill in the tax year space at the top of page 1. Short year filers should file using the tax form for the calendar year within which the short year falls. If the short year spans more than one calendar year, the filer should file using the tax form for the calendar year in which the short year began. If the current form is not available at the time the short year filer must file, the filer should follow the rules explained in TIR 11-12. What If I am Unable to Pay? If you are unable to pay the full amount of tax that you owe, you should pay as much of your tax liability as possible with this return. You will receive a bill from DOR for the remaining amount of tax due plus accrued interest and penalty charges. If the amount of that bill is less than $10,000 and you still cannot pay it in full, you must apply formally to DOR for a small payment agreement in order to avoid collection activity. You can apply for a small payment agreement by visiting Mass TaxConnect at mass.gov/masstaxconnect. Note: Do not mail your request for a payment agreement with your tax return. Requests can be made once a bill is issued through DOR’s MassTaxConnect application at mass.gov/dor or by calling DOR at (617) 887-6367. Setting up a small payment agreement will allow you to make monthly payments within a set time period to satisfy your unpaid liability. Name and Address Print the full name, address, and Social Security number of each person filing the return in the spaces provided. Enter names as they appear on your federal return. Social Security Number(s) Be sure to enter your Social Security number(s) on your return. Also, enter your Social Security number on pages 2 through 4 of Form 1 and on page 2 of Schedule B or Schedule C, if filed. Fail- 7 ure to show the correct Social Security number in the space provided will delay the processing of your return. If filing jointly, list your number and your spouse’s number in the order they appear on your federal return. Taxpayers filing their U.S. return using an Individual Taxpayer Identification number (ITIN) should enter that ITIN as their Social Security number in the appropriate space. Also, be sure your employer has listed the correct Social Security number on your Form W-2. If you are married, you must list your spouse’s name and Social Security number even if you are filing a separate return. Other Jurisdiction Change To apply for an SSN, you must complete Form SS-5. Form SS-5 is available online at socialsecurity.gov, from your local Social Security Administration (SSA) office, or by calling the SSA at (800) 772-1213. It usually takes about two weeks to receive an SSN. If you are a nonresident or resident alien and you do not have and are not eligible for an SSN, you must apply for an ITIN. For details on how to do so, see Form W-7 and its instructions. Form W-7 is available online at irs.gov or by calling the IRS at (800) 829-1040. It usually takes about four to six weeks to receive an ITIN. In certain instances, an amended return showing a reduction of tax may be treated by DOR as an abatement application. Under such circumstances, by filing an amended return, you are giving your consent for the Commissioner of Revenue to act upon the abatement application after six months from the date of filing. See TIR 1611. You may withdraw such consent at any time by contacting the DOR in writing. If consent is withdrawn, any requested reduction in tax will be deemed denied either at the expiration of six months from the date of filing or the date consent is withdrawn, whichever is later. Note: You must wait until you receive an ITIN or SSN to file your Massachusetts return. Filing an Amended Return Filing an Amended Return If you need to change a line item on your return, complete a new return with the corrected information and fill in the Amended return oval. Your amended return must include all schedules filed with the original return even if there are no changes to the schedules. Mail your amended return to the same address used for original returns. Do not file Form ABT with your amended return. An amended return can be filed to either increase or decrease your tax. An amended return should also be filed to correct a credit amount (such as withholding) or to dispute a health care penalty. Generally, an amended return must be filed within three years of the date that your original return was filed. Visit mass.gov/dor/amend for more information about filing an amended return. Federal Changes If your amended return includes changes resulting from another state or jurisdiction audit or change, fill in the Other Jurisdiction change oval. Amended return due to IRS BBA Partnership Audit If your amended return includes changes made due to an IRS BBA Audit, fill in the Amended return due to IRS BBA Partnership Audit oval. Consent to Extend the Time to Act on an Amended Return treated as Abatement Application Filing an Application for Abatement File an Application for Abatement only to dispute one of the following: ◗ Penalties ◗ Audit assessments ◗ Responsible person determinations For the fastest response time, file your dispute online at mass.gov/masstaxconnect. If you cannot file online, use Form ABT. Visit mass.gov/dor/amend for additional information about filing an amended return, or filing an application for abatement. Form 1 Frequent Errors Not entering the information below correctly may result in an item being adjusted or removed. ◗ Line 2c – You must fill in the bubble for each spouse over 65 and enter a “1” or “2” in the Total box accordingly. If your amended return includes changes you have reported on an amended federal return filed with the IRS for the same tax year or if you are amending due to changes as a result of a federal audit, check the Amended return due to federal change oval. ◗ Line 3 – If you are a Massachusetts state, city, town, or county employee, you must report the State wages, tips etc. amount from box 16 of Form W-2. If your amended return does not report changes that result from the filing of a federal amended return or from a federal audit (for example, if the amended Massachusetts return is reporting a rental deduction not claimed on the original return) fill in only the Amended return oval. ◗ Line 38 – You must submit all documents that have Massachusetts withholding, including passthrough entity or K-1 withholding. ◗ Line 14 – Enter the total qualified rent paid in 2021 in the box, then divide by 2. ◗ Lines 39 and 40 – Be sure to differentiate any overpayment from 2020 as a credit carry forward 2021 Form 1 Instructions 8 on line 39 and do not list it as 2021 estimated tax payment on line 40. Failure to include this documentation could delay processing of your return. ◗ Line 44 – Schedule CB must be completed and submitted with your return. a. Total Federal Income ◗ Line 48 – Excess Paid Family Leave withholding (PFML) is not the amount shown on your Form W-2. You must use the worksheet for line 48 to see if you qualify and to calculate the excess amount. Each taxpayer would need to have multiple W-2’s and to have paid PFML greater than $539.78 to qualify. Or, have paid on the gross amount of self-employment income, not the net. ◗ Schedules B, C, D – Entries should be positive values unless there is a box to mark to indicate a negative value. Enter your total federal income (from U.S. Form 1040, line 9). If married filing separately and living in the same household, each spouse must combine their income figures from their separate U.S. returns when completing this section. If you did not have a requirement to file a U.S. return, you must enter 0 in this section. Note: Failure to enter this information will delay the processing of your return. b. Federal Adjusted Gross Income ◗ Schedule HC – You must complete and submit Schedule HC showing the FEIN and subscriber number. Form 1095 is a federal form and cannot be used to report health care coverage in Massachusetts. Enter your federal adjusted gross income (from U.S. Form 1040, line 11) If married filing separately and living in the same household, each spouse must combine their income figures from their separate U.S. returns when completing this section. If you did not have a requirement to file a U.S. return, you must enter 0 in this section. Voluntary Contribution to State Election Campaign Fund Note: Failure to enter this information will delay the processing of your return. You, and your spouse if filing jointly, may voluntarily contribute $1 each to the State Election Campaign Fund. The purpose of this fund is to provide limited public financing for campaigns of eligible candidates for statewide and elective office. This contribution will not change your tax or reduce your refund. Veterans Benefits Fill in the appropriate oval(s) for you, and/or your spouse if married filing a joint return, if you are a veteran who served in the Armed Forces of the United States in active service as part of Operation Enduring Freedom, Operation Iraqi Freedom, Operation Noble Eagle or Operation Sinai Peninsula and were discharged under honorable conditions and were domiciled for six months in Massachusetts immediately prior to entry into the Armed Forces. DOR will then forward the name and address to the Department of Veterans’ Services and the adjutant general of the Massachusetts National Guard to verify eligibility for any benefits you may be entitled to. Deceased Taxpayer Be sure to fill in the appropriate oval if a taxpayer died during the taxable year. For further information, refer to the section How Do I File a Decedent’s Return? Under Age 18 If you are under age 18 as of January 1, 2022, be sure to fill in the oval(s). Name Change If you legally changed your name in 2021, fill in the oval. Enclose a copy of your Social Security card or driver’s license showing your new name. Noncustodial Parent Fill in the oval if you are a noncustodial parent. A noncustodial parent is defined as a person who has a minor child, but does not live with the child. Note: If you are the biological parent of a child, but your parental rights have been terminated, you are not the noncustodial parent of that child. Schedule TDS. Inconsistent Filing Position Penalty Fill in the oval and enclose Schedule TDS, Taxpayer Disclosure Statement, if you are disclosing any inconsistent filing positions. Schedule TDS is available on our website at mass.gov/dor. The inconsistent filing position penalty (see TIR 06-5, § IV) applies to taxpayers that take an inconsistent position in reporting income. These taxpayers must “disclose the inconsistency” when filing their Massachusetts return. If such inconsistency is not disclosed, the taxpayer will be subject to a penalty equal to the amount of tax attributable to the inconsistency. This penalty is in addition to any other penalties that may apply. A taxpayer is deemed to have taken an “inconsistent position” when the taxpayer pays less tax in Massachusetts based upon an interpretation of Massachusetts law that differs from the position taken by the taxpayer in another state where the taxpayer files a return and the governing law in that other state “is the same in all material respects” as the Massachusetts law. The Commissioner may waive or abate the penalty if the inconsistency or failure to disclose was attributable to reasonable cause and not willful neglect. Note: Lines without specific instructions are considered to be self-explanatory. Line 1. Filing Status Note: More than one filing status may apply to you. If so, you may wish to figure your taxes based upon more than one filing status to see which status is to your benefit. Be sure to select only one filing status. Single Fill in the Single oval if you were single as of December 31, 2021. This status applies to you if at the close of the taxable year you fit into any of the following categories: ◗ You were unmarried; ◗ You were a widow or widower whose spouse died before 2021; or ◗ You were legally separated under a final judgment of the probate court. Note that you are not single if: ◗ You have obtained a judgment of divorce which has not yet become final; ◗ You have a temporary support order; or ◗ You and your spouse simply choose to live apart. Married Filing Joint Return Fill in the Married filing joint return oval if you were legally married as of December 31, 2021. Both spouses are responsible for the accuracy of all information entered on a joint return and both must sign. A joint return is allowed even if only one spouse had income or if one spouse died during 2021. For further information, refer to the section “What Are the Rules for Filing a Joint Return?” Married Filing Separate Return Fill in the Married filing separate return oval if you were legally married as of December 31, 2021, and if you and your spouse are not filing a joint return. Be sure to enter your spouse’s name and Social Security number in the space provided. Head of Household Fill in the Head of household oval if you qualify to file this status federally. This status is for unmarried people who paid over half the cost of keeping up a home for a qualifying person, such as a child who lived with you or your dependent parent. Be sure to include such qualifying person on Schedule DI, Dependent Information. Certain married people who lived apart from their spouse for the last six months of 2021 and who meet all of the other federal requirements may also be able to use this status. See IRS Publication 501, Exemptions, Standard Deduction, and Filing Information, for more information. Custodial Parent Fill in the Custodial parent who has released claim to exemption for child(ren) oval if you are claiming the head of household filing sta- 2021 Form 1 Instructions tus and you have released your claim to one or more dependent exemptions on U.S. Form 8332, or participated in a decree or agreement to allow the noncustodial parent to claim a dependency exemption. Whole Dollar Method Required DOR requires that the whole dollar method be used for entries made on forms or schedules. For example, amounts between $1.00 and $1.49 should be entered as $1.00 and amounts between $1.50 and $2.00 should be entered as $2.00. However, calculations on worksheets used to reach amounts shown on the return may be made in one of two ways: ◗ Round amounts before adding them up and enter the resulting total on the form; or ◗ Add amounts to the penny, and then round to the whole dollar for entry on the form. Either method is acceptable as long as one method is used consistently throughout the return. Line 2. Exemptions Line 2a. Personal Exemptions Each taxpayer is entitled to claim a personal exemption. The amount of your personal exemption depends on your filing status in line 1. ◗ If you are single or married filing a separate return, enter $4,400 in line 2a. ◗ If filing as head of household, enter $6,800 in line 2a. ◗ If married filing a joint return, enter $8,800 in line 2a. Line 2b. Number of Dependents You may claim a $1,000 exemption for each of your dependents if you claimed them on your U.S. return. Enter in the box in item b the number of dependents you listed on U.S. Form 1040. Do not include yourself or your spouse. Then, multiply that total by $1,000 and enter the total amount in line 2b. Be sure to fill out Schedule DI, Dependent Information, if you are claiming a dependent exemption(s). Failure to do so will delay the processing of your return. Note: Only one person (or married couple filing jointly) may claim the dependent exemption for any one child or other dependent. In a few cases, the number of dependents claimed for Massachusetts purposes and for U.S. purposes may differ. Massachusetts allows a dependent exemption for each individual who qualifies for exemption as a dependent under § 151(c) of the Code. For purposes of § 151(c), the definition of dependent in § 152 is adopted. Under federal law, there are additional restrictions on the dependent exemption beyond the rules of § 152 that are not adopted by Massachusetts. For Massachusetts tax purposes, if an individual qualifies 9 as a dependent under the rules of § 152, you can claim a dependent exemption for such a person. If you claim such a dependent in Massachusetts, increase the number reported in item b from your U.S. return by the number of such additional dependents. Line 3. Wages, Salaries, Tips and Other Employee Compensation Line 2c. Age 65 or Over Before 2022 Note: Following are instances that require an adjustment to these amounts: You are allowed an additional $700 exemption if you were age 65 or over before January 1, 2022. If your spouse was age 65 or over and you are filing a joint return, you may also claim a $700 exemption for your spouse. Fill in the appropriate oval(s) and enter the total number of persons age 65 or over in the small box. Multiply that total by $700 and enter the total in line 2c. Line 2d: Blindness Exemption You are allowed an additional $2,200 exemption if you are legally blind. If your spouse is also legally blind and you are filing a joint return, you may also claim a $2,200 exemption for your spouse. Fill in the appropriate oval(s) and enter the total number of blindness exemptions in the small box. Multiply that total by $2,200 and enter the total in line 2d. Legal Definition of Blindness You are legally blind and qualify for the blindness exemption if your visual acuity with correction is 20/200 or less in the better eye, or if your peripheral field of vision has been contracted to a 10-degree radius or less, regardless of visual acuity. Line 2e. Medical/Dental Expenses You may claim an exemption for medical and dental expenses paid during 2021 only if you itemized these expenses on your U.S. Form 1040, Schedule A. If you are married filing a joint U.S. Form 1040, you must file a joint Massachusetts Form 1 to claim this exemption. Enter in line 2e, item 1 the amount reported on your U.S. Form 1040, Schedule A, line 4. Line 2f. Adoption Agency Fee If you paid adoption fees to a licensed adoption agency during 2021, you are eligible for an exemption of the total amount of the fees paid during the year. Fees paid during 2021 to an agency licensed to place children for adoption on account of the adoption process of a minor child regardless of whether an adoption actually took place during 2021 should also be included for this exemption. Enter this amount in line 2f. 5.0% Income Note: DOR and the IRS maintain an extensive exchange program, routinely sharing computer tapes and audit results. Discrepancies between income, deductions, and schedules reported federally and on this return, except those allowed under state law, will be identified and may result in a state audit or further investigation. Report in line 3 total state wages and allocated tips from Form(s) W-2. Generally, your total wages and allocated tips will be the same amount reported on your U.S. Form 1040, line 1. Massachusetts Residents Working in a Foreign Country Income earned by a Massachusetts resident in a foreign country is subject to taxation in Massachusetts. If you excluded part or all of the compensation earned in a foreign country on your U.S. return (under IRC § 911), you must include any such amount in line 3 for Massachusetts tax purposes. State or Local Employees Contributing to Pension Plans If you are a Massachusetts state, city, town or county employee and contributed to your pension plan, enter in line 3 the Massachusetts W-2 state wage amount. This is generally box 16 of Form W-2. This amount will be higher than the U.S. amount because your pension contributions are excluded from your income for U.S. tax purposes. Contributions up to $2,000 per taxpayer may be deducted in lines 11a and/or 11b. Line 4. Taxable Pensions and Annuities Income from most private pensions or annuity plans is taxable in Massachusetts. Certain government pensions, however, are exempt under Massachusetts law. In general, exempt pensions include contributory pensions from the U.S. Government or the Commonwealth of Massachusetts and its political subdivisions, and noncontributory military pensions. The following section describes some specific pensions which are exempt. If your pension is exempt, enter 0 in line 4 and note the source on the dotted line to the left. If your pension is not exempt, you should generally enter in line 4 the taxable amount reported on your U.S. Form 1040, line 5b. In some cases, however, Massachusetts law requires an adjustment to the federal amount. Distributions from annuity, stock bonus, pension, profit-sharing or deferred payment plans or contracts described in §§ 403(b) and 404 of the IRC must be adjusted to account for your contributions that have been previously taxed. Subtract from such income (as reported on your U.S. Form 1040, line 5a) the amount of your contributions which was previously taxed by Massachusetts until the total of your taxed contributions is received. If your pension falls into this category, enter the adjusted amount in line 4. If you are receiving distributions from an IRA or Keogh plan, do not report 2021 Form 1 Instructions 10 the income here; instead, see the instructions for Schedule X, line 2. should be reported in line 9, “Other Income (from Schedule X).” Note: Massachusetts does not tax Social Security income; therefore, you should not report such income on Massachusetts Form 1. Rollover from a traditional IRA to a Roth IRA. Taxpayers are allowed to make partial or complete rollovers from existing IRAs to Roth IRAs. Any taxable portion of these rollovers included in federal gross income is also included in Massachusetts gross income, except for amounts previously subject to Massachusetts personal income tax. See Schedule X, line 2 instructions for further details. What pensions are exempt? ◗ Pension income received from a contributory annuity, pension, endowment or retirement fund of the U.S. Government or the Commonwealth of Massachusetts and its political subdivisions. ◗ Pension income from other states or their political subdivisions which do not tax such income from Massachusetts, or its political subdivisions must be reported in line 4. However, this income may be eligible for a deduction on Schedule Y line 13. Refer to the instructions for Schedule Y line 13 to determine eligibility for this deduction. ◗ Noncontributory pension income or survivorship benefits received from the U.S. uniformed services (Army, Navy, Marine Corps, Air Force, Coast Guard, commissioned corps of the Public Health Service and National Oceanic and Atmospheric Administration) are exempt from taxation in Massachusetts. Line 5. Interest from Massachusetts Banks Enter in line 5a the total amount of interest received or credited to deposit accounts (term and time de-posits, including certificates of deposit, savings accounts, savings shares, and NOW accounts) in Massachusetts banks. Then, enter your exemption amount in line 5b (if married filing jointly, enter $200; otherwise, enter $100). Subtract line 5b from 5a and enter the result in line 5, but not less than 0. Note: This exemption amount does not apply to your U.S. tax return. ◗ Massachusetts state court judges who were appointed on or after January 2, 1975 are participants in the Massachusetts contributory retirement system and their pensions are nontaxable. State court judges who were appointed prior to January 2, 1975 receive taxable noncontributory pensions. Do not subtract interest forfeited or penalties charged to you for early savings withdrawal. You will be allowed to deduct these amounts on Schedule Y, line 2. All other interest, unless exempt, should be entered on Massachusetts Schedule B. Interest on an IRA/Keogh is not taxable until distributed. If you retired under MGL ch 32, §§ 56–60 and are a veteran who began Massachusetts state service prior to July 1, 1939, all or part of your pension income may be subject to tax. If you elected to receive your proceeds from contributions in one lump-sum distribution, your original contributions to the retirement system are not taxable. Noncontributory pension income received after a lump-sum distribution is fully taxable and should be reported in line 4. Lines 6, 7 and 10 How do I report lump-sum distributions? If you were an employee of the U.S., Massachusetts or one of its political subdivisions and left public employment prior to retirement, you are not required to report as income the lump-sum distribution of your previously-taxed pension contributions. Lump-sum distributions of qualified employee benefit plans in excess of the employee’s contributions which were previously subject to Massachusetts tax (or not previously excluded from Massachusetts tax) must be reported in line 4. Generally, qualified rollovers are not taxable in Massachusetts to the extent they are not taxable on your U.S. return. Lump-sum distributions related to IRA/Keogh and Roth IRA distributions If showing a loss in lines 6, 7 or 10, be sure to mark over the X in the box to the left. Do not use parentheses or negative signs to indicate losses. Line 6a. Business/Profession Income or Loss Enter in line 6a the amount of income or loss from a business or profession from Massachusetts Schedule C, line 37. You must enclose Massachusetts Schedule C with this return. Note: U.S. Schedule C is not allowed as a substitute for Massachusetts Schedule C. Line 6b. Farm Income or Loss If you operate a farm as an individual or cooperative, enter in line 6b the amount of income or loss from operating a farm from U.S. Schedule F, Profit or Loss from Farming, line 34. Enclose a copy of U.S. Schedule F. Complete a pro forma U.S. Schedule F to report Massachusetts differences, such as bonus depreciation. Line 7. Rental, Royalty, REMIC, Partner ship, S Corporation, Trust Income or Loss Taxpayers with income or loss reported on a Schedule E must file his or her tax return using computer-generated forms produced by third- party software. The tax return may be generated by the taxpayer or by a tax professional. The taxpayer is encouraged, but not required, to submit the return electronically. Paper forms produced using the third-party software product will contain a two-dimensional (2D) bar code and will also be accepted. If the taxpayer hires an income tax preparer to complete the taxpayer’s taxes, the preparer must follow the Commissioner’s electronic filing rules. See TIRs 08-22 and 16-9 for more information. If you do not have access to a software package when filing your 2021 income tax return, you may file your Schedule(s) E on paper. Visit our website at mass.gov/dor to download a paper copy of the 2021 Schedule(s) E, E-1, E-2, E-3 (and instructions) to file with your income tax return. Line 8a. Unemployment Compensation If you received unemployment compensation, enter in line 8a the amount from U.S. Form 1040, Schedule 1, line 7. If you elected voluntary withholding of Massachusetts state income taxes on your unemployment compensation, be sure to include the amount of Massachusetts state income tax withheld, as reported on Form 1099-G, on Form 1, line 38. Update to Unemployment Compensation Reporting due to the COVID-19 Pandemic Recent legislation has enacted a deduction for unemployment compensation for tax year 2021. Please refer to below link for more information: https://www.mass.gov/info-details/tax-filing-season-frequently-asked-questions#unemployment-benefits-and-unemployment-fraudNote: DOR routinely matches the amounts in line 8a with files from the Division of Unemployment Assistance. Line 8b. Massachusetts State Lottery Winnings Enter in line 8b all winnings from the Massachusetts state lottery. Do not enter less than 0. You may only deduct the price of your winning ticket. Lottery losses claimed as itemized deductions on U.S. Form 1040, Schedule A are not allowed on your Massachusetts return. Note: DOR routinely matches the amounts in line 8b with files from the Lottery Commission. Line 9. Other Income (from Schedule X) Alimony Received, Taxable IRA/Keogh and Roth IRA Conversion Distributions, Other Gambling Winnings, Fees and Other 5.0% Income and PFML taxable distributions. “Other 5.0% income” includes the items listed above and must be included on Schedule X. Enter the total from Schedule X, line 6. Not less than 0. Be sure to enclose Schedule X with your return. 2021 Form 1 Instructions 11 Failure to enclose this schedule will delay the processing of your return. Note: This deduction amount does not apply to your U.S. tax return. Deductions What Qualifies for the Rental Deduction? Lines 11 through 15 Massachusetts allowable deductions differ from itemized deductions on Schedule A of U.S. Form 1040. You may claim only the deductions specified on Massachusetts Form 1, lines 11 through 14 and Schedule Y. You are not allowed to deduct amounts unless they are directly related to income that is subject to taxation and reported on Massachusetts Form 1. Line 11. Amount Paid to Social Security (FICA), Medicare, Railroad, U.S. or Massachusetts Retirement Systems If you have paid into any of the retirement systems listed above during 2021, you may deduct those contributions, up to a maximum of $2,000. Enter in lines 11a and 11b the amount you, and your spouse if filing jointly, paid to Social Security (FICA), Medicare or Railroad Retirement and the U.S. or Massachusetts retirement systems during 2021 as shown on your Form W-2, but not more than $2,000 each. Payment amounts may not be combined or transferred from one spouse to the other. Be sure to add any amount of Medicare tax withheld as shown on Form W-2 and any amount of self-employment tax as reported on your U.S. Form 1040 to the amount of Social Security tax withheld, the total not to exceed $2,000 per person. Note: Medicare premiums deducted from your Social Security or retirement payments are not deductible. Payments to an IRA, Keogh, Simplified Employee Pension Plan (SEP), or Savings Incentive Match Plan for Employees (SIMPLE) Account are not deductible for Massachusetts income tax purposes. 2021 Changes for Lines 12 and 13 See instructions for lines 45 and 46 for the new child under age 13, or disabled dependent/ spouse care expenses credit and the new dependent member(s) of household under age 12, or dependents age 65 or over, or disabled dependent credit. Line 14. 50% Rental Deduction You may be entitled to a rental deduction equal to one-half (50%) of the rent you paid during 2021 (up to a maximum of $3,000 per return) for your principal residence in Massachusetts. Enter the total amount of qualified rent paid by you during 2021 in line 14a. Divide line 14a by 2 and enter the result, or $3,000 ($1,500 if married filing a separate return) — whichever is smaller — in line 14. The deduction must be for rent you paid to a landlord for the rental or lease of your principal residence in Massachusetts. If two or more persons jointly rent a unit, each occupant using it as his/ her principal residence is entitled to a deduction based on the amount of rent that each person paid. If the rent is paid by a third party (such as a parent) who maintains a principal residence elsewhere, no 50% rental deduction is allowed for either party. A principal residence does not include any residence for vacation, an apartment for a person on a temporary assignment or a student or faculty member who has a principal residence elsewhere. It also does not include any apartment or house in Massachusetts of a nonresident who has a residence in another state or country. Payment for occupying a hotel, motel or rooming house is not considered rent unless a rental agreement exists. Nor are payments
Form 1 Instructions
More about the Massachusetts Form 1 Instructions Individual Income Tax TY 2021
Use these instructions to help you fill out and file your Form 1 individual income tax return with the Massachusetts Department of Revenue. Form 1 Instructions requires you to list multiple forms of income, such as wages, interest, or alimony .
We last updated the Individual Income Tax Instructions in January 2022, so this is the latest version of Form 1 Instructions, fully updated for tax year 2021. You can download or print current or past-year PDFs of Form 1 Instructions directly from TaxFormFinder. You can print other Massachusetts tax forms here.
Other Massachusetts Individual Income Tax Forms:
|Form Code||Form Name|
|Form 1||Resident Income Tax Return|
|Schedule Y||Other Deductions|
|Form M-4868||Application for Automatic Six-Month Extension of Time to File Massachusetts Income Tax Return|
|Form 1-NR/PY||Nonresident or Part-Year Resident Income Tax Return|
|Schedule X||Other Income|
Massachusetts usually releases forms for the current tax year between January and April. We last updated Massachusetts Form 1 Instructions from the Department of Revenue in January 2022.
About the Individual Income Tax
The IRS and most states collect a personal income tax, which is paid throughout the year via tax withholding or estimated income tax payments.
Most taxpayers are required to file a yearly income tax return in April to both the Internal Revenue Service and their state's revenue department, which will result in either a tax refund of excess withheld income or a tax payment if the withholding does not cover the taxpayer's entire liability. Every taxpayer's situation is different - please consult a CPA or licensed tax preparer to ensure that you are filing the correct tax forms!
Historical Past-Year Versions of Massachusetts Form 1 Instructions
We have a total of seven past-year versions of Form 1 Instructions in the TaxFormFinder archives, including for the previous tax year. Download past year versions of this tax form as PDFs here:
form 1 instructions
form 1 instructions
form 1 instructions
While we do our best to keep our list of Massachusetts Income Tax Forms up to date and complete, we cannot be held liable for errors or omissions. Is the form on this page out-of-date or not working? Please let us know and we will fix it ASAP.