Taxes in Boston
Massachusetts levies a real flat 5% state income tax, with a real, additional 4% 'millionaires tax' surtax on income above $1,107,750 (2026 threshold) -- producing an effective 9% top marginal rate, though most Boston residents' effective rate is the flat 5% -- alongside a statewide 6.25% sales tax with no general local add-on, and a genuinely disclosed local property tax picture where Boston's classified system taxes residential property below commercial, even as the residential rate itself rose in FY2026.
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Learn moreMassachusetts's Real Flat 5% State Income Tax, Plus a Real Millionaires-Tax Surtax
Massachusetts's state income tax is a real flat 5% -- but since a 2022 ballot measure, income above $1,107,750 (the 2026 threshold, indexed annually) carries a real additional 4% 'millionaires tax' surtax, producing an effective 9% top marginal rate. This record states this precisely rather than citing only the flat base rate or only the top-bracket rate in isolation: most Boston residents' actual effective rate is the flat 5%, since the surtax applies only to income above the threshold.
A Separate, Real 8.5% Rate on Certain Short-Term Capital Gains
Massachusetts also levies a separate, real 8.5% rate on certain short-term capital gains -- a distinct provision from the ordinary income-tax brackets and surtax described above. Confirm current, specific treatment for a given transaction directly with the Massachusetts Department of Revenue or a tax professional.
Boston's Classified Property Tax System Runs Below Commercial for Residential Owners
As detailed further on the property-taxes topic page, Boston's FY2026 residential property tax rate ($12.40 per $1,000 assessed value, with a real 35% owner-occupant exemption) runs genuinely below the commercial rate ($26.96 per $1,000) -- though the residential rate itself rose 13% on typical bills year-over-year, a real, current cost pressure.
Massachusetts's Standard 6.25% Sales Tax, With No General Local Add-On
Massachusetts's statewide base sales tax runs 6.25%, with no general local or municipal add-on -- genuinely simpler than a market with a stacked state-plus-city-plus-county sales tax structure.
No Local Boston Wage or Payroll Tax on Residents
Boston does not levy its own separate municipal wage or payroll tax on residents -- Massachusetts's flat state income tax (plus the millionaires-tax surtax where applicable) is the full state-level income-tax picture for a Boston resident, a real, meaningful simplification relative to a city with a comparable local wage-tax layer covered elsewhere in this project.
Key takeaways
- Massachusetts's flat 5% state income tax carries a real 4% millionaires-tax surtax above $1,107,750 -- an effective 9% top rate, though most residents pay the flat 5%.
- A separate, real 8.5% rate applies to certain short-term capital gains.
- Boston's classified property tax system taxes residential property ($12.40/$1,000, FY2026) below commercial ($26.96/$1,000), though the residential rate itself rose 13% year-over-year.
- Massachusetts's statewide 6.25% sales tax carries no general local add-on.
- Boston does not levy a separate local wage or payroll tax -- Massachusetts's state income tax is the full income-tax picture for residents.
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