Massachusetts Residency and Tax Treatment of Non-Residents

MIT employees who are residing out of state (temporarily or permanently) should review the guidelines below to determine residency for income tax purposes. 

To submit a change of residency or an income tax withholding election to MIT, use the form below. (Touchstone login required.)

 Residency Declaration and Income Tax Withholding Election Form

Guidelines

An individual is considered to be a Massachusetts resident, for income tax purposes, if the individual: (i)  is domiciled in Massachusetts; and/or (ii) maintains a permanent place of abode in Massachusetts and spends more than 183 days of the taxable year in Massachusetts. A Massachusetts resident is taxed on foreign earned income even if such income is earned during a temporary or protracted absence from Massachusetts.  A non-resident, however, is taxed only on income derived from or connected to sources in Massachusetts. 

The following information is intended to provide guidance regarding Massachusetts' tax residency rules.  These guidelines focus on Massachusetts income tax liability only, and not on federal tax liability.

1. Domiciles

An individual's domicile is the place in which the individual maintains his/her true, fixed, and permanent home.  Although an individual may have many places of residence, he/she can have only one domicile.  A person's domicile is usually the place where he/she maintains his/her most important family, social, economic, political and religious ties. 

Once a person is considered to have a Massachusetts domicile, he/she will retain that status  until he/she establishes a new domicile outside of Massachusetts. The mere absence from Massachusetts does not constitute the relinquishment of one's Massachusetts domicile. Although an individual's absence from Massachusetts is an important factor, other factors, including the individual's intent, are equally important.

To acquire a new domicile outside Massachusetts, an individual must meet three conditions:

  1. Physical presence in a new location outside of Massachusetts;
  2. An intent to make that location the individual's home either indefinitely or permanently; and
  3. An intent not to return to reside in Massachusetts. 

Notes: Physical Presence Outside Massachusetts: The first condition requires that the individual maintain a physical presence outside of Massachusetts.  However, if an individual resides outside of Massachusetts and makes an occasional and short-term visit to Massachusetts, the circumstances suggest that he/she would still meet this requirement. 

Intent to Relocate: Massachusetts does not specify any minimum length of stay that is required to establish an intent to make a new location one's home. A planned stay at the new location that is open-ended will probably be sufficient to prove an intent to make one's home at the new location. A planned stay for several years may also be sufficient. In those cases where an MIT employee is sent to another state or foreign country for a fixed time of one year or less, the circumstances suggest that the person will not qualify for exemption from Massachusetts tax.

No Present Intent to Return: Massachusetts courts have focused on certain factors in rendering decisions regarding the issue of intent to return to Massachusetts. Some of these items are as follows:

  • Has the individual purchased or leased a new home or apartment in the new location?
  • Has the individual canceled his/her Massachusetts bank accounts and opened new accounts in the new location?
  • Did the individual cancel his/her Massachusetts driver's license/registration and obtain a new license/registration in the new location?
  • Did the individual relocate his/her personal property to the new location? 
  • Is the individual's immediate family still residing in Massachusetts?
  • Where is the individual involved in social, civil, or cultural organizations?
  • Has the individual changed his/her voter registration? 
  • Does the individual plan to stay in the new location for a fixed period of time, as opposed to an indefinite stay?

II. Permanent Place of Abode > 183 Days

 Even if an individual is not domiciled in Massachusetts, the individual is still a tax resident of Massachusetts if he/she maintains a permanent place of abode in Massachusetts and spends more than 183 days of the taxable year in Massachusetts. 

A permanent place of abode is a dwelling place that is continually maintained by the individual, whether or not owned by such individual, and includes a dwelling place owned or leased by an individual's spouse.  A permanent place of abode generally does not include:

  • A camp, military barracks and housing, dormitory room, hospital room, or room in any other similar temporary institutional setting
  • A university-owned apartment available only to a university-affiliated student, faculty, and staff
  • A dwelling place that is maintained only during a temporary stay in Massachusetts for accomplishing a particular documented purpose (note: a temporary stay is defined as a predetermined period of time not to exceed 1 year). 

To qualify as a tax resident under "permanent place of abode" guidelines, the individual must also spend more than 183 days of the relevant tax year in Massachusetts. For purposes of calculating days spent in Massachusetts, a day is defined as any part of any day spent in Massachusetts for whatever reason.  However, for members of the U.S. Armed Forces, days spent in Massachusetts while on active duty are not considered days spent in Massachusetts for purposes of establishing whether the member is a resident of Massachusetts. 

III. Part-Year Residents and MA Source Income

A part-year resident for Massachusetts income tax purposes is a person who either moves to Massachusetts during the taxable year and becomes a resident or a person who terminates his/her Massachusetts residency during the taxable year to establish a tax residence outside the state. A determination of whether a person is a part-year resident and when residency commences or terminates depends on facts and circumstances relevant to each person's situation. For the period of time that a person is a resident of Massachusetts, all income earned during this time is subject to Massachusetts tax. 

For any period in which an individual is not a Massachusetts tax resident, only income that is derived from sources in Massachusetts, as detailed in G.L. c. 62, § 5A, is subject to Massachusetts withholding and taxes. Massachusetts requires employers to withhold Massachusetts personal income tax in connection with wages earned by nonresidents who perform services in Massachusetts. 

IV. Massachusetts Income Tax Withholding Options for MIT Employees  

1. No Reporting and Withholding

When an employee determines and certifies, to the best of his/her knowledge and belief, that:

(i) he/she is NOT domiciled in Massachusetts; and

(ii) he/she will NOT maintain a Massachusetts permanent place of abode and spend more than 183 days in Massachusetts in a tax year; and

(iii) his/her compensation from MIT is for services performed outside Massachusetts;

MIT will not report any salary and/or wages earned to Massachusetts and will not withhold Massachusetts income taxes. As in all tax matters, the ultimate responsibility as to the taxability of income rests with the individual taxpayer.

Note: If applicable, the employee will be treated as part-year resident for the portion of the tax year prior to signing this form, and needs to file a MA part-year resident tax return.

2. Reporting and Withholding

When an employee determines and certifies, to the best of his/her knowledge and belief, that:

(i) he/she is domiciled in Massachusetts; or

(ii) he/she will maintain a Massachusetts permanent place of abode and spend more than 183 days in Massachusetts in a tax year; or

(iii) his/her compensation from MIT is for services performed in Massachusetts;

MIT will report all gross salary and/or wages to Massachusetts. Even though MIT must report earnings in this situation, MIT is NOT REQUIRED, under Massachusetts regulations, to withhold Massachusetts income tax due to the foreign tax structure and policy However, MIT recommends that employees elect to have such income tax withheld. Otherwise the employee will be responsible for paying such tax directly to the Massachusetts Department of Revenue through the filing of quarterly estimated tax payments. If the employee wishes, as regulations allow, he/she may elect the exemption from withholding. MIT will also withhold Massachusetts income taxes unless the applicable law of another state or an agreement between another state and Massachusetts dictates otherwise.


Declare a Change in Residency or Change an Income Tax Withholding Election

MIT employees may submit a change of residency or an income tax withholding election to MIT using the form below. (Touchstone login required.)

 Residency Declaration and Income Tax Withholding Election Form