What is the Massachusetts millionaire surtax and how does it affect me?

Effective January 2023, Massachusetts voters approved a 4% surtax on annual income exceeding $1 million (adjusted annually for inflation). This means Massachusetts residents earning over $1M now pay a combined 9% state income tax on income above the threshold. For someone earning $2 million, the surtax alone would cost $40,000. By establishing Florida residency, you eliminate both the base 5% tax AND the 4% surtax entirely.

Does Massachusetts have a safe harbor rule for former residents?

Massachusetts has a "safe harbor" rule: if you maintain a home in Massachusetts but establish domicile elsewhere, you will not be taxed as a resident if you spend no more than 183 days in Massachusetts during the tax year. However, the Massachusetts Department of Revenue may still challenge your domicile change if other factors suggest you remain a Massachusetts resident. Keeping detailed records of your time in each state is critical.

How does Massachusetts source income work after I move to Florida?

After establishing Florida domicile, Massachusetts can still tax "Massachusetts-source income." This includes: wages for work physically performed in Massachusetts, income from Massachusetts-based businesses, rental income from Massachusetts property, and gains on sale of Massachusetts real estate. Remote work performed from Florida for a Massachusetts employer is generally not MA-source income, though rules can be complex. Consult a tax professional.

How does Massachusetts determine residency for tax purposes?

Massachusetts uses a domicile test. Your domicile is where you intend to maintain your permanent home. Factors include: where you spend most of your time, location of your family, where you're registered to vote, driver's license state, vehicle registrations, where you work, location of banks and professional advisors, and where your social connections are. No single factor is decisive—the totality of circumstances is considered.

How much can I save by moving from Massachusetts to Florida?

At the base 5% rate, someone earning $200,000 would save approximately $10,000 annually. For $500,000 in income, savings would be approximately $25,000. For high earners over $1 million, savings increase dramatically due to the 4% surtax—someone earning $2 million could save approximately $85,000+ per year. Florida has no state income tax on any income type.

Can Massachusetts tax my capital gains after I move?

Massachusetts taxes short-term capital gains at 12% and long-term capital gains at 5% (plus the 4% surtax for gains that push total income over $1M). If you establish Florida residency before realizing large capital gains, you can potentially eliminate state-level capital gains tax entirely. Timing your domicile change before a major liquidity event (business sale, stock vesting, etc.) can save significant amounts.

Does Massachusetts tax my retirement income?

Yes, Massachusetts taxes most retirement income at the flat 5% rate, including 401(k) distributions, IRA withdrawals, and pension income. Social Security benefits are exempt from Massachusetts tax. By moving to Florida, you eliminate state tax on all retirement income. For retirees drawing $100,000+ from retirement accounts, this represents $5,000+ in annual savings.

What documents should I keep to prove I left Massachusetts?

Maintain: Florida driver's license, Florida voter registration, Declaration of Domicile filed in Florida, lease or deed for Florida residence, utility bills in Florida, records of time spent in each state (calendars, travel receipts), Florida vehicle registration, updated estate documents executed in Florida, records of Massachusetts ties severed with dates, and tax returns showing Florida as your state of residence.

Massachusetts → Florida Tax Migration

Escape Massachusetts's 9% Millionaire Tax

Massachusetts's new 4% surtax on income over $1M pushes the top rate to 9%. Save $5,000-$90,000+ annually by establishing Florida residency. We help you navigate the process, document your move, and protect yourself from state audits.

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Your Massachusetts Tax Savings

See how much you could save by moving from Massachusetts to Florida

Your Annual Income

$150,000

🦞

Massachusetts

$7,500/year in state tax

5% flat rate

🌞

Florida

$0/year in state tax

0% state income tax

YOUR ESTIMATED ANNUAL SAVINGS

$7,500

That's $75,000 over 10 years

*Estimate based on Massachusetts 2024 tax rates (5% + 4% surtax on income over $1M). Individual results vary. Consult a tax professional.

How to Leave Massachusetts the Right Way

Our 5-step process protects you from state tax audits

Document Your Intent to Leave Massachusetts

Establish clear evidence of your intent to make Florida your permanent home. Create a timeline, document your reasons, and prepare for potential scrutiny from the Massachusetts Department of Revenue.

Set Up Your Florida Address & Virtual Mailbox

Get a legitimate Florida residential address. Complete USPS Form 1583 with remote notarization. Your mail will be scanned and accessible from anywhere.

Obtain Florida Driver's License & Update Voter Registration

Surrender your Massachusetts license and get a Florida license. Register to vote in Florida. These are two of the strongest indicators of domicile change.

Sever Massachusetts Ties Systematically

Close Massachusetts bank accounts, update professional licenses, move financial advisors, cancel Massachusetts memberships, and file a Declaration of Domicile in Florida. Document everything.

File Your Final Massachusetts Return & Maintain Florida Ties

File a part-year return for Massachusetts. Going forward, build Florida ties: register vehicles, update estate documents, and maintain organized records. If you earn over $1M, escaping the surtax makes this especially valuable.

Complete Guide

Florida Residency: Everything You Need to Know

Learn about Florida's tax advantages, residency requirements, and how to establish domicile.

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Massachusetts Exit FAQ

Common questions about leaving Massachusetts for Florida

Ready to Leave Massachusetts Taxes Behind?

Escape the millionaire surtax and Massachusetts's 5% base rate. We'll help you establish proper Florida residency and keep more of what you earn.

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