US State Tax Massachusetts

Your Ultimate Guide to US Payroll in Massachusetts

Managing payroll in Massachusetts? Read our state-by-state guide to US payroll taxes to learn what you must withhold and deduct from employee wages.

Stefana Zaric
Written by Stefana Zaric
August 7, 2023

Key takeaways

  1. Employers must pay unemployment insurance for their Massachusetts employees.
  2. Employers are also responsible for withholding and paying PFML tax, a state program that offers paid leave for family or medical reasons to eligible employees.
  3. Massachusetts employers must pay for workers’ compensation, even if they only have one Massachusetts employee.

As an employer with workers in Massachusetts, you need to understand state payroll taxes to ensure compliance with the law. Besides federal taxes like Medicare and Social Security, you are also responsible for withholding and paying specific Massachusetts state taxes from your employees' payroll.

This helpful guide provides an overview of Massachusetts payroll tax requirements.

Paying unemployment insurance

Unemployment Insurance (UI) is a national program managed by the U.S. Department of Labor. It provides temporary payments to individuals who are unemployed through no fault of their own. As an employer in Massachusetts, you are required to pay UI on behalf of your employees.

You can manage your Massachusetts unemployment insurance through the state's online portal, which offers a convenient platform for handling UI payments and related matters.

To learn more about paying your unemployment insurance and your specific obligations, refer to the Massachusetts Department of Unemployment Assistance's information.

Withholding personal income tax from your Massachusetts employee 

Massachusetts employers are responsible for withholding Personal Income Tax (PIT) from their employees' wages.

PIT, also known as individual income tax or state income tax, is deducted from the employee's wages and remitted to the state by the employer. You can pay the withheld amount through Massachusetts' online portal, which simplifies the process of managing and submitting taxes.

For a detailed understanding of your responsibilities and the requirements associated with PIT withholding, the Massachusetts Department of Revenue provides comprehensive information.

Withholding and paying Paid Family Leave (PFL) in Massachusetts

Massachusetts employers are also responsible for withholding and paying Paid Family and Medical Leave (PFML) tax.

PFML is a state program that offers up to 26 weeks of paid leave for family or medical reasons to eligible employees. To meet this requirement, employers can pay the PFML tax through Massachusetts' online portal.

For more details about the Paid Family and Medical Leave program, refer to the Massachusetts Department of Family and Medical Leave's information.

Paying your Massachusetts workers’ compensation 

Workers' Compensation (WC) insurance is essential for employers in Massachusetts, providing coverage for employees' job-related injuries or illnesses.

Whether you have one or multiple employees, you must purchase Workers' Compensation insurance from a qualified commercial carrier within the state. To find a qualified carrier that meets the state's requirements, refer to the information provided by the Massachusetts Department of Industrial Accidents.

Simplify US payroll tax compliance with Deel

While this guide provides essential information on Massachusetts payroll taxes, payroll compliance, and state requirements extend beyond what is covered above. To streamline the process and ensure full compliance, companies can turn to Deel. 

Deel offers a comprehensive solution for managing US and international payroll, including payments, taxes, worker classification, and more. Speak with an expert today to see how you can streamline your US payroll processes and ensure compliance with state regulations.

Disclaimer: This article is provided for general informational purposes and should not be treated as legal or tax advice. Consult a professional before proceeding.

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