Massachusetts: Tax Relief in the House

April 17, 2023

A long-promised tax relief package was introduced in the Massachusetts House last week.

Massachusetts: Tax Relief in the House

A long-promised tax relief package was introduced in the Massachusetts House last week. Governor Maura Healey filed her proposal earlier in the year and included a $3 million estate tax exemption that NFIB strongly supported. The House version of the relief bill was a step backwards. It rolled the estate tax exemption proposal back to $2 million benefiting roughly 50% of people that will face the estate tax. Massachusetts currently has the lowest exemption in the nation at $1, the House bill doubles it. The Healey proposal tripled the exemption, helping to make Massachusetts less of an outlier by applying to 70% of those impacted by the estate tax. Fortunately, both proposals seek to eliminate the fiscal cliff. One additional negative aspect of the House relief plan modifies the 62F law. You may recall that last year the state of Massachusetts was forced to return nearly $3 billion to taxpayers after triggering the 62F revenue cap that was approved by voters via referendum in 1986. The House wanted to seek more “equity” in how the funds were distributed. In 2022, refunds were roughly 14% of a Massachusetts resident’s income tax liabilities. The House plan will take the excess tax revenue and evenly redistribute it amongst all taxpayers so that everyone receives an equal share. NFIB asked House members to reinstate Governor Healey’s $3 million estate tax exemption and abandon efforts to modify the 62F law, but it passed unaltered despite our objections. The Senate will tackle tax relief efforts next.

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State:

Massachusetts

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