Millions of Mass. taxpayers will get money back starting in November, officials say. Here are the details.


It marks just the second instance the law has been triggered in nearly 40 years.

The law stipulates that any credit is applied on a “proportional basis,” meaning those who paid more in taxes are due to benefit the most. Baker administration officials cautioned Friday that the 13 percent “refund” is a preliminary estimate and that officials will finalize it in late October, after all 2021 tax returns are filed.

Baker’s budget office had previously estimated in July that taxpayers stood to get back roughly 7 percent of the income taxes they paid in 2021.

To be eligible, individuals must have filed a 2021 state tax return by Oct. 17. State officials said someone’s credit could be reduced if they have unpaid taxes, unpaid child support, and other debts.

The state ended the last fiscal year in June with a nearly $5 billion surplus after collecting nearly 21 percent more in tax revenue than it did a year ago, an extraordinary jump. Aides to Baker have said the surplus is large enough to cover the credit, and estimated the state would still have some $2 billion in surplus revenue, itself a whopping figure.

“With families facing continued pressure from high prices and inflation, these returns will provide some needed relief,” Governor Charlie Baker said in a statement Friday. “Even with nearly $3 billion going back to taxpayers, significant state and federal resources remain, and we look forward to working with the Legislature to invest this funding into our economy, communities and families.”

State officials have set up a website where people can calculate their estimated credit. The state also plans to launch a five-day-a-week call center starting Tuesday to help answer people’s questions.

The only other time the law was triggered was in 1987 when tax collections exceeded the allowable amount by $29.2 million, according to a previous report from Bump’s office.

At the time, the state did not issue the credit directly, but instead added a line to the 1987 version of the individual income tax return form where individual taxpayers could “insert his or her individually calculated share.” The state ultimately issued $16.8 million in credits, leaving nearly $12.4 million unclaimed.

Whether the Baker administration can, in fact, issue the credits as a direct refund may be an open debate.

Kurt Wise, a senior policy analyst at the Massachusetts Budget and Policy Center, told the Globe on Thursday that the law is clear in calling the refund a “tax credit,” effectively limiting the form it can take. Wise also noted that Bump in her own statement described it as taking the “form of a credit.”

The language, however, also leaves it to the state revenue commissioner to set the rules for implementing the law.

State Representative Mike Connolly, a Cambridge Democrat who has advocated limiting what high-income earners could get back under the credit, said Friday that he is considering taking legal action in a bid to stop Baker from issuing checks in “this unprecedented fashion.” The law gives taxpayers the option to file litigation to “enforce the provisions of this chapter.”

Connolly said his objective is to not delay people receiving the money, but for the Legislature to “take action as soon as possible to explicitly and legally authorize distribution of these refund checks this fall, and at the same time, for us to adjust the distribution formula so middle-income and poor folks see a greater share” of the nearly $3 billion.

House and Senate leaders have not indicated they have any plans to change the law or reshape how the state distributes the excess revenue.

The likelihood of billions flowing back to taxpayers has roiled Beacon Hill, and lands amid a separate ongoing debate about whether the state should raise taxes on some of its wealthiest residents.

Baker’s disclosure during the final days of the Legislature’s formal sessions in July that the state was poised to trigger the decades-old law upended talks over a $4.5 billion spending package that included roughly $1 billion in proposed tax relief.

The Legislature gaveled its formal sessions to close the morning of Aug. 1 with no deal on the legislation, leaving the fate of a final package in limbo. In a statement on Thursday after Bump had certified the amount taxpayers will receive, House Speaker Ronald Mariano said that legislative leaders intend to continue talks over a potential economic development package.

This is a breaking news story and will be updated.


Matt Stout can be reached at matt.stout@globe.com. Follow him on Twitter @mattpstout.



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