Why incorporate in Massachusetts?
Business Information & Rankings
- Massachusetts ranked 3rd in the Top States for Biotech Growth Index. (Laboratories of Innovation: State Bioscience Initiatives 2004)
- Massachusetts ranked 1st for both the number of high-technology companies per capita and the level of venture capital investment. (Development Report Card for the States: 2004, Corporation for Enterprise Development)
- Massachusetts offers one of the nation’s largest R&D tax credits. (2004 Index of the Massachusetts Economy)
- Massachusetts has produced half of all the Nobel Prize winners in the country.
Cost of Living Index
|For Boston, MA (2005):||Index Score|
|Misc. Goods & Services:||123.2|
Massachusetts has the 13th lowest crime ranking in the U.S. (FBI, 2004)
Fees & Taxes
Business Inventory Tax
Business inventory is exempt.
Corporate Income Tax
Massachusetts’ corporate tax structure consists of a flat rate of 9.5% on all corporate income. This rate includes a 14% surtax, as does the following: an additional tax of $7.00 per $1,000 on taxable tangible property (or net worth allocable to state, for intangible property corporations); and a minimum tax of $456.
Personal Income Tax
Massachusetts’ personal income tax system consists of a flat tax of 5.3% on all personal income.
Personal Property Tax
Taxable. All real and tangible personal property located within the Commonwealth of Massachusetts is taxable unless specifically exempted by statute.
Massachusetts imposes a 5.3% tax on any gains from the sale or exchange of capital assets held for more than one year. There is an exception for collectibles. The state’s long-term gains rate on collectibles is 12%.
The state also collects a 12% tax on interest (except interest from Massachusetts banks), dividends, and gains from the sale or exchange of capital assets held for one year or less (short-term capital gains).
Massachusetts is one of the 38 states that collect property taxes at both the state and local levels.
State Sales and Use Tax
Base Rate: 5.0%
Machinery Rate: None
There is a exemption for sales of machinery or replacement parts thereof used directly in farming, fishing, the actual manufacturing of tangible personal property to be sold, utilities, or research and development by a manufacturing constitution or a research and development corporation.
Massachusetts’ new employers’ rate is 2.53% for 2 years.