#2023-23, September 29, 2023

Tax Relief Bill Updates Estate Tax Code, Capital Gains Rate, and More

Earlier this week, House & Senate Leadership voted on their agreed upon $1B+ tax relief proposal that aims at offering relief to Bay Staters – including eliminating the estate tax for estates under $2 million as well as its so-called “cliff effect.” The bill is now before Governor Maura Healey for her signature.

The accord, which is a rewrite of the House-backed H. 3770, the Senate-approved S.2397, and Governor Healey’s H. 42 proposal, looks to address the high cost of living for working families in the Commonwealth in a responsible and sustainable way.

The final negotiated MA tax package includes:

1. Estate Tax Relief:
   A long-fought Association battle, the final package reforms the MA estate tax by eliminating the tax for estates under $2 million. As the Association has raised in our advocacy for estate tax reform over many years, Massachusetts is an outlier as one of only 12 states that impose an estate tax at all. As such, the state runs the risk that older residents leave the state, and professionals may not wish to move here if they see the tax climate as unfavorable for themselves and their families. While the relief is certainly welcome, we should note that other nearby states still impose their estate taxes at a much higher threshold – including Vermont at $5 million, Maine at $5.8 million, New York at $6.1 million, and Connecticut at the federal threshold ($12.3 M) beginning next year.

2. Single Sales Factor Apportionment:
   Presently, most businesses in Massachusetts are subject to a three-factor apportionment based on location, payroll, and receipts. The agreement establishes a single sales factor apportionment in Massachusetts based solely on receipts, matching what 39 other states currently do, according to House Leadership who proposed the provision and passed it in their original bill.

   • The final accord also contains additional language included in the “Investment & Trading” provision than that which was originally passed in the House-backed bill.

3. Short Term Capital Gains Rate Relief:
   The agreement includes a reduced rate on short-term capital gains tax of 8.5%.

4. Housing Tax Relief for Renters:
   The new law would allow filers to deduct up to 50% of the cost of the rent for their primary residence, up to $4,000; as well as doubles the tax credit for seniors who rent or own in Massachusetts from $1,200 to $2,400.

The Boston Globe’s Tonya Alanez and Matt Stout have more on the details of the tax package, which can be found here.

Massachusetts Department of Revenue: Mid-September Report - $2.42 Billion Collected

The Massachusetts Department of Revenue (DOR) released mid-September collections data reporting the Commonwealth collected $2.42 billion during the first half of the month, which is $76 million (3.2%) more than what was collected in the same period of September 2022.

To read the September 2023 mid-month report, click here.

Join Today: Basic Banking for Massachusetts

Basic Banking for Massachusetts was launched in 1994 as a product of the Partnership for Financial Equity’s Banking Services Committee to expand access to bank products and services and to encourage those with modest incomes to establish banking relationships. Banks participating in Basic Banking for Massachusetts voluntarily provide low-cost checking and savings accounts that meet the guidelines below.

To learn more about Basic Banking for Massachusetts or to become a participating Financial Institution, contact Tom Callahan, Partnership for Financial Equity Executive Director at 857-309-3096 or tcallahan@financialequity.net.

Election Day is Tuesday, November 7, 2023

With under 6 weeks until Election Day, many municipalities are gearing up for a busy election season. You know better than most the vital role that municipal government plays in our daily lives and how important it is to vote in local elections.

For your convenience, find pertinent election information in the links below:

• Register to Vote
• Upcoming Elections – Primary and General Election Day Dates and Information
• Find Your Polling Place
• Vote-by-Mail Information
  • To track your mail-in ballot: Track Your Ballot

For more 2023 Election information and resources, click here.