Massachusetts: Sales Tax Handbook
How to file your sales taxes in Massachusetts
Once your business has a Massachusetts sales tax license and begins to make sales, you are required to start collecting sales taxes on behalf of the Massachusetts government and filing regular sales tax returns. This page will help you understand the basics of your tax collection and filing responsibilities.
How To Collect Sales Tax In Massachusetts
If the seller has an in-state location in the state of Massachusetts, they are legally required to collect sales tax at the statewide tax rate, which is 6% in the state of Massachusetts.
If the seller's location is out of state, then the same policy applies: the state of Massachusetts still requires the seller to charge the statewide sales tax rate.
Sales Tax Collection Discounts In Massachusetts
While many states allow merchants to keep a small percentage of the sales tax they collect as a collection discount, or compensation for the work put in collecting the tax on behalf of the state, Massachusetts does not currently allow this.
Your Massachusetts Sales Tax Filing Requirements
To file sales tax in Massachusetts, you must begin by reporting gross sales for the reporting period, and calculate the total amount of sales tax due from this period.
In the state of Massachusetts, all taxpayers have two options for filing their taxes. One option is to file online by using the Massachusetts Department of Revenue's MassTaxConnect website, the new system that has replaced the older Massachusetts WebFile for Business website. This online system can also be utilized to remit tax payments as well as file returns.
It must be noted that any business that has over five thousand dollars in tax liability is required to use MassTaxConnect to both file and pay. The other option is the phone service Telefile, which can also be used to pay your tax liabilities.
Massachusetts Late Filing Penalties:
Taxpayers in Massachusetts should be aware of several late penalties the state applies. The penalty for late filing is 1% of the unpaid tax on the return per month that it goes unpaid, with a maximum compounded penalty of 25%. The penalty for late payments is interest, which is charged at the federal short-term rate, in addition to four percentage points, which are compounded daily.
The state of Massachusetts does require that all sellers who hold a sales tax permit file a sales tax return on the required day, even if the tax return would have been "zeroed-out", and there is nothing to report.
Your Massachusetts Sales Tax Filing Frequency & Due Dates
Your business's sales tax return must be filed by the 20th of the month following reporting period. For a list of this year's actual due dates, see our calendar of Massachusetts sales tax filing due dates.
Where To File Your Massachusetts Sales Tax Return:
Filing Your Massachusetts Sales Tax Returns Online
Massachusetts supports electronic filing of sales tax returns, which is often much faster than filing via mail.Online filing is required for all businesses that registered for sales tax permits after August 31, 2003 and for all taxpayers filing zero tax returns. Taxpayers who had a combined tax liability (including wage withholding, excise taxes, and all sales taxes) in the preceding calendar year of at least $5,000 (previously, $10,000) in combined taxes are also required to file online. Online filing is optional for taxpayers that do not fall within either group.
Massachusetts allows businesses to make sales tax payments electronically via the internet.Electronic payments are required from most taxpayers. For other taxpayers who have been grandfathered in, the electronic payments are optional.
You can process your required sales tax filings and payments online using the official MassTaxConnect website, which can be found here . You should have received credentials to access your MassTaxConnect account when you applied for your Massachusetts sales tax license.
Filing Your Massachusetts Sales Tax Returns Offline
While it is highly recommended that you file online using the MassTaxConnect website, it is possible to file your required sales tax reportings offline using Massachusetts Form ST-9A, which you can download and print here . Once you have completed your required reportings, you can mail it to the state at this address:Massachusetts Sales Tax Filing Address:
Please note that if you file your Massachusetts sales taxes by mail, it may take significantly longer to process your returns and payments.
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