Massachusetts Tax Refund: How to Calculate How Much Money You’ll Get Back

Massachusetts taxpayers are getting nearly $3 billion in income tax payments back, the state Executive Office for Administration and Finance has confirmed. Thanks to Chapter 62F,  a 1986 voter-approved statute, tax revenue is tied to growth in wages and any excess must be returned to taxpayers.

This is only the second time that the refund has been triggered.

Massachusetts Finance Secretary Michael Heffernan said taxpayers will receive a credit “in the proportion that they paid in.” Previously, the administration said the refund would be approximately 13% of their 2021 state income tax liability.

That’s just an estimate, however — the actual amount won’t be finalized until after all 2021 tax returns have been filed in late October. And individual refunds could be offset by unpaid tax liabilities, child support payments and other debts.

Here’s what Massachusetts residents need to know about the tax rebate, including who is eligible, how much it could be for and when it may go out.

For more on tax relief, find out which states are mailing out tax rebates, pausing their gas tax and instituting sales tax “holidays.”

How much will the Massachusetts tax rebate be?

Gov. Charlie Baker originally proposed a $250 refund, intended for individual filers who earned between $38,000 and $100,000 last year and joint filers who made up to $150,000. But that plan was scuttled in favor of enforcing Chapter 62F.

The state has estimated taxpayers could receive 13% of their state income tax liability back but the exact amount is still to be determined.  

 A website has been set up to answer frequently asked questions and help residents get a preliminary estimate of their refund. A call center is also available at 877-677-9727. 

Massachusetts residents could start receiving their refunds in November 2022, according to Gov. Charlie Baker.

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Who qualifies for the Massachusetts tax rebate?

Theoretically, anyone who paid 2021 income tax in Massachusetts would be eligible to be paid back. Indivudals with outstanding tax bills, child support payments or other debts may see their credit reduced or eliminated altogether.

When will rebate checks go out?

State Auditor Suzanne Bump confirmed on Sept, 15 that Massachusetts had more than $2.9 million in excess tax revenue that needed to go back to taxpayers. Direct deposits and physical checks should start being distributed in November 2022, according to Gov. Charlie Baker.

“With families facing continued pressure from high prices and inflation, these returns will provide some needed relief,” Baker said in a statement.

What other tax breaks could Massachusetts residents receive?

Lawmakers want to increase the earned income tax credit from the 30% match of the federal credit to 40%, raise the child care credit from $180  per child to $310 and increase the rental deduction cap from $3,000 to $4,000. 

Certain seniors who own or rent their primary properties in Massachusetts get a “circuit breaker” tax credit, and Democrats want to bump the maximum from $1,170 to $2,340.