According to Massachusetts House Speaker Ronald Mariano,
Massachusetts ( Photo: WAMC )
Massachusetts House has approved a tax relief package worth $654 million for the fiscal year 2024
The bill, which aims to provide assistance to seniors, renters, businesses, and wealthier homeowners, also revises the law that returned approximately $3 billion to taxpayers last year. The tax relief package is expected to result in $1.1 billion in savings for taxpayers in the 2026 fiscal year.
One of the key changes included in the proposal is to increase the state’s estate tax threshold from $1 million to $2 million. Massachusetts is one of the twelve states with an estate tax. Democratic Governor Maura Healey proposed a tax relief package worth $742 million in February, which would eliminate the tax for estates valued up to $3 million.
Additionally, the bill would make modifications to the 1986 law designed to limit state tax revenue growth and return excess revenue to taxpayers. Last year, this law resulted in almost $3 billion in refunds. The bill would credit an equal amount per taxpayer, unlike the current proportional basis, which gives higher credits to those who pay more taxes.
The House proposal includes combining the child care expenses credit with the dependent member of household credit to create one refundable $600 credit per dependent
It also doubles the tax credit for eligible seniors who own or rent property from $1,200 to $2,400, increases the rental deduction cap from $3,000 to $4,000, and boosts the earned income tax credit from 30% to 40% of the federal credit.
Moreover, the tax relief package lowers the short-term capital gains tax rate from 12% to 5% over two years and strengthens the state’s stabilization fund, commonly referred to as the rainy day fund.
The House approved the bill with an overwhelming majority of 150-3 votes. If passed by the Senate and signed by the Governor, the proposed tax relief package will take effect in the fiscal year 2024, providing significant relief to taxpayers in Massachusetts.
