BOSTON — Gov. Charlie Baker on Friday announced details on how the state plans to return nearly $3 billion in excess revenue to millions of taxpayers starting this fall.
The news comes after Auditor Suzanne Bump confirmed that the Department of Revenue must return $2.94 billion to taxpayers because state revenues soared past the allowable amount under a voter-approved law.
Bump certified that the 1986 tax cap law known as Chapter 62F set the maximum fiscal 2022 state tax revenue figure at $38,871,154,627. State government collected $41,812,654,358 in FY22, leading to an overage of $2,941,499,731, the State House News reported Thursday.
In a statement, Baker said, “Stronger-than expected state tax revenues have led to a major surplus for Fiscal Year 2022, and we are pleased to be able to return nearly $3 billion in excess revenue to the taxpayers. With families facing continued pressure from high prices and inflation, these returns will provide some needed relief. 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.”
Beginning in November, $2.941 billion in Chapter 62F refunds will be distributed to about 3.6 million eligible taxpayers in proportion to personal income tax liability in Massachusetts incurred by taxpayers in the immediately preceding taxable year 2021.
In general, eligible taxpayers will receive a credit in the form of a refund that is approximately 13% of their Massachusetts Tax Year 2021 personal income tax liability.
The state noted that this percentage is a preliminary estimate and will be finalized in late October, after all 2021 tax returns are filed.
In order to qualify for a credit, residents must have filed a 2021 state tax return on or before October 17, 2022. Credit may be reduced due to refund intercepts, including for unpaid taxes, unpaid child support, and certain other debt.
Those who are eligible for a refund will receive it automatically as a check sent through the mail or through direct deposit.
A refund estimator can be found here.
This is a developing story. Check back for updates as more information becomes available.
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