Massachusetts tips tax calculator: all tips reported
The Massachusetts Department of Revenue says it does not allow the federal deduction of qualified tips income: “All tips income must be reported in Massachusetts.”
Massachusetts income is defined its own way
Massachusetts lists the federal tips deduction among its differences from federal law, alongside the overtime deduction, which it also rejects. Because Massachusetts builds gross income from its own categories rather than federal taxable income, there is nothing to add back — tips are simply wages on Form 1.
Massachusetts figures
| Cash wage / minimum | $6.75 / $15.00 |
|---|---|
| In force | July 1, 2026 |
| Next change | none scheduled |
| Tipped threshold | More than $20 a month in tips |
| Tips on the 2025 return | tips stay taxable in this state. DOR: “Massachusetts does not allow the federal deduction of qualified tips income. All tips income must be reported in Massachusetts.” Source: Massachusetts Department of Revenue |
| Tips on the 2026 return | tips stay taxable in this state. Unchanged. Source: Massachusetts Department of Revenue |
Tipped pay
The tipped cash wage is $6.75 against a $15.00 minimum, a tip credit of $8.25. Massachusetts counts someone as a tipped worker at more than $20 a month in tips, a lower threshold than the federal $30.
A Boston bartender
$27,000 of tips exceed the cap, so the federal deduction is $25,000 and saves $3,000; Massachusetts taxes all $27,000. In a 32-hour week, $6.75 an hour plus $180 of tips is $84 short of $480.
Check a Massachusetts workweek
Where these figures come from
- Massachusetts Department of Revenue · Massachusetts Attorney General, Fair Labor Division
- Differences Between MA and Federal Tax Law for Personal Income (2026)
- Minimum Wages for Tipped Employees (table by state) (2026-07-01)
Federal rules: how the deduction works. Nearby: New York, Vermont, New Hampshire, Rhode Island, Connecticut.
Figures verified against primary sources on