Massachusetts tax return changes for 2026

TIR 26-4 (June 23, 2026) explains St. 2026, c. 101. For personal income tax, gross income follows the Code as amended and in effect on January 1, 2024, while trade or business deductions generally follow the current Code. The corporate excise automatically conforms to the current Code, with limited exceptions.

• Tips, overtime and car loan interest deductions: not adopted for personal income tax.
• Full expensing of business property: not adopted for either tax.
• Higher section 179 limits and the qualified production property allowance: adopted for tax years beginning on or after January 1, 2027.
• Section 163(j) change: adopted from 2027.
• Domestic research expensing: adopted in part from 2026. Massachusetts decouples from the retroactive and transition rules, so 2022 to 2024 costs keep five-year amortization.
• Non-itemizer charitable deduction and the 0.5% floor: not adopted for personal income tax.
• The higher 1099 reporting threshold: adopted.

Because Massachusetts follows the higher federal information reporting threshold, the same contractor list works for both returns. HelloBooks tracks payments against the threshold and prepares 1099s in the Combined Federal/State Filing format. Massachusetts penalties are at /us/penalties/massachusetts.