What you'd save under the Mass. tax relief bill

Also: Cambridge is getting a new federal life sciences hub; living without the right to drive [Donate ❤️]( [View in Browser](  September 27, 2023 ☀️ Mostly sunny, with a high near 66. Good Morning Boston, Twenty months [later]( the Massachusetts tax cut bill is nearing the finish line. After [their latest round of negotiations]( top Democrats in the State House [unveiled a new $1 billion compromise tax package yesterday]( — and for all intents and purposes, this is the one you want to pay attention to. The bill is expected to breeze through the House and Senate to Gov. Maura Healey's desk by the end of this week. So, wondering how much money you'll save? The bill has a little something — or, in some cases, a lot of something — for almost everyone. Here's a breakdown of some of the biggest provisions: - For parents and caregivers: Massachusetts currently lets parents and guardians claim [a tax credit of up to $240]( for each child they have under the age of 13 — as well as dependents over the age of 65 and disabled dependents of any age. The new bill increases the credit to $310 per dependent for the 2023 tax year (i.e. the taxes you'll file this coming spring) and then up to $440 for tax year 2024 and beyond. - That means an eventual savings of $200 per child if you’re a parent already taking full advantage of the current credit. - Additionally, the bill eliminates the current credit's limit of two qualifying dependents, meaning potentially even more savings for those with three or more kids. For example, a couple with four kids would get an additional $1,280 a year starting in the 2024 tax year. - For lower-income residents: The bill would increase [Massachusetts’ earned income tax credit]( (EITC) for low-income residents, from 30% of the federal EITC to 40%. - The impact depends on your personal circumstances. For example, if you’re single with no kids and made the maximum qualifying amount for the EITC last year ($16,480), you’d save an additional $56. But if you’re a parent of two making the maximum ($49,399), you’d save over $600 more a year. - For seniors: Massachusetts allows lower-income residents aged 65 and older to claim a $1,200 credit on their taxes. The bill doubles that credit to $2,400. - For the last tax year, the income limit for the credit was $64,000 for a single individual and $96,000 for a married couple filing jointly. It's worth noting [the eligibility rules depend on exactly how much]( you pay in property taxes or rent. But if you qualify, the change means you save another $1,200 a year. - For renters: Massachusetts currently lets renters [write off 50% of their rent]( from their taxes each year, up to $3,000. The bill increases that maximum deduction to $4,000. - If you pay more than $8,000 in rent a year (and who doesn’t if you rent in the Boston area), the increased deduction means you'll save an extra $50 a year. - For heirs: The [current Massachusetts estate tax]( — which[Healey]( and [others]( have criticized for making the state an "outlier" — imposes a one-time, graduated tax on inheritances valued at or above $1 million when they are passed down after the owner dies. It applies to everything from financial assets to physical property like homes, cars and jewelry. Under the new tax deal, the threshold would go up to $2 million. The bill also includes a uniform credit of $99,600 to eliminate the "[cliff effect]( for estates just above the threshold. - If you have an estate above the newly proposed $2 million threshold, it would mean a savings of around $99,000. - For investors: If you buy a stock and sell it within a year in Massachusetts, your profits get hit with the state's 12% short-term capital gains tax. The new bill brings that rate down to 8.5%, a little closer to the state's 5% tax on long-term capital gains. - The impact here depends on the amount of short-term investing you're doing. For example, if you made $10,000 off buying and selling stocks within the last year, you'd save $350. (It's also worth noting the top 1% of households in Massachusetts would receive most of the benefit of this tax cut, [according to an analysis by a local left-leaning think tank]( - Wait, there's more: The bill also includes a raft of more narrow — but sometimes still sizable — perks for everyone from low-income housing developers to local theaters to hard cider makers to residents trying to replace their septic tanks. ([Topical!]( - Read [the full summary of the bill]( and [an analysis of how the Senate and House compromised]( in different areas. P.S.— Our fall fundraising goal is for 2,500 WBUR fans to become monthly contributors. Ongoing, monthly contributions provide the funding we need to bring you the stories and information you count on (like this newsletter). And if you [make a monthly gift]( before 10 a.m., it will be matched dollar for dollar. Give now to [double your impact](. Nik DeCosta-Klipa Editor, Newsletters [Follow](  Support the news  The Rundown [Cambridge selected as a hub for a federal life sciences network]( Massachusetts was chosen to host the National Institutes of Health agency's Investor Catalyst Hub, meant to help ARPA-H programs "navigate the complexities of the business and regulatory landscape and provide resources to help bring ideas to market," according to the governor's office. [Read more.]( [Cambridge selected as a hub for a federal life sciences network]( Massachusetts was chosen to host the National Institutes of Health agency's Investor Catalyst Hub, meant to help ARPA-H programs "navigate the complexities of the business and regulatory landscape and provide resources to help bring ideas to market," according to the governor's office. 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[Read more.]( [U.S. sues Amazon in a monopoly case that could be existential for the retail giant]( The Federal Trade Commission and 17 states accuse Amazon of suffocating rivals and raising costs for both sellers and shoppers. [Read more.]( [Warren, Markey join calls for Menendez to resign following corruption charges]( Both Massachusetts senators have called for New Jersey Sen. Bob Menendez to resign, joining a growing number of Democrats in demanding their colleague’s ouster following federal bribery and corruption charges. [Read more.]( [Warren, Markey join calls for Menendez to resign following corruption charges]( Both Massachusetts senators have called for New Jersey Sen. Bob Menendez to resign, joining a growing number of Democrats in demanding their colleague’s ouster following federal bribery and corruption charges. [Read more.]( [State funds Mass. hotline to reduce risk of fatal overdoses]( With overdose deaths at a record high, Massachusetts is funding an overdose prevention hotline. People using drugs call a toll-free number. Staff monitor them and notify emergency responders if they stop responding. Public health leaders say it's the first such investment by a state to prevent overdose deaths. [Read more.]( [State funds Mass. hotline to reduce risk of fatal overdoses]( With overdose deaths at a record high, Massachusetts is funding an overdose prevention hotline. People using drugs call a toll-free number. Staff monitor them and notify emergency responders if they stop responding. Public health leaders say it's the first such investment by a state to prevent overdose deaths. [Read more.]( Anything Else? - The general election races are set in Beverly, Chelsea, Holyoke and Fitchburg following yesterday's preliminaries. [Click here]( for a list of all the results and the preliminary battles remaining on the schedule this season. - A pioneering farm in East Boston is getting $1 million to expand its youth Climate Corps program this February. WBUR's Barbara Moran reports [the program will train 40 young people]( in urban farming, food distribution, climate resilience and community organizing. - Today's local Tiny Desk Contest spotlight: Berklee grad Varsha. The singer-songwriter says she never found a personal anthem, "so I decided to write one myself." The result: A combo of R&B and Hindu influences coming together in the song “Woman.” Listen to it [here](. - On the national stage: [Seven candidates]( are set to take part in the second Republican presidential primary debate tonight in California (but not former president Donald Trump, who is [traveling to Michigan to speak to striking autoworkers](. 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