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Do You Pay Massachusetts Income Tax If You Live in New Hampshire? It Depends.

General Rule:** You pay MA income tax **only on income *earned in* Massachusetts** (sourced there). NH has **no income tax on wages**.

Scenarios

Tax Credit (If You Pay Both)

NH has **no income tax**, so **no credit needed** on NH return. You **only file MA Nonresident Return** for MA-source income. No double taxation.

Key Forms

  • MA Form 1-NR/PY — Nonresident/Part-Year Return.
  • MA Schedule NR — Allocation of income.
  • **Employer:** Must withhold MA tax if you work in MA (even if live in NH).

Remote Work Nuance (Post-2020)

MA **Convenience of the Employer Rule** (830 CMR 62.5A.3) — **if your NH home office is for *your* convenience, not employer's necessity**, MA *could* argue sourcing to MA. **But MA DOR guidance (2021+) and practice** generally **respect work location** for nonresidents. **Get a written remote-work agreement** stating NH location is employer-required/approved.

Consult a CPA/tax pro** for your specific facts.

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    SituationMA Tax Due?Notes
    Live in NH, **work remotely for MA employer** (from NH home office)NOIncome sourced to NH (work location). MA cannot tax. *Post-COVID standard.*
    Live in NH, **commute to MA workplace**YESWages sourced to MA. File MA **Nonresident Return (Form 1-NR/PY)**.
    Live in NH, **rental property in MA**YESNet rental income sourced to MA. File 1-NR/PY.
    Live in NH, **interest/dividends from MA banks/stocks**NOIntangible income sourced to *residence* (NH). MA doesn't tax nonresident portfolio income.
    Live in NH, **sell MA real estate**YESCapital gain sourced to MA. Withholding at closing (Form 1-NR/PY).
    Live in NH, **partner in MA partnership / S-corp**YESDistributive share of MA-source income taxed. Composite filing possible.