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Massachusetts Taxation of Nonresidents – Selected Issues
When: January 11, 2024
Location: State Tax Virtual Conference
 

Massachusetts Society of CPAs (MassCPAs)

People: Richard L. Jones and Caroline A. Kupiec

Richard Jones and Caroline Kupiec spoke on a panel, "Massachusetts Taxation of Nonresidents – Selected Issues," at the State Tax Virtual Conference sponsored by MassCPAs.

As many former residents of Massachusetts have learned, leaving the state does not necessarily mean leaving behind the obligation to pay Massachusetts income tax. Nonresidents are taxed on Massachusetts-source income, which encompasses income effectively connected with a trade or business, including employment, in Massachusetts. There continues to be uncertainty and an evolving landscape about what is considered Massachusetts-source income, particularly with respect to a nonresident’s sale of an interest in a business operating in Massachusetts.

In this session, Rich and Caroline addressed several nonresident tax issues, distilling the clear obligations from the gray areas, and highlighting overlooked opportunities. Among other things, they discussed the often-vexing task of calculating Massachusetts-source income attributable to the ownership of pass-through entities, compensation of remote or travelling workers and income from stock options and other kinds of deferred compensation.