Sales Tax and Reverse Sales Tax Calculator Massachusetts

MASSACHUSETTS [Multidirectional Calculator]
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  • 6.25%
  • 6.3%
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  • Amount Before Tax ${{amountBeforeTax}}
  • Sales Tax Rate {{SalesTaxRate}}%
  • Amount Of Taxes ${{AmountOfTaxes}}
  • Amount After Taxes ${{AmountAfterTaxes}}



Massachusetts – MA Sales Tax Calculator: User Guide

Whether you are starting, expanding, or relocating your business in Massachusetts, it is vital to know about Massachusetts's sales tax. Wherefore our experts have worked days and nights to bring you a MA Sales Tax Guide along with a handy Massachusetts Sales Tax Calculator to help calculate MA Sales Tax accurately in no time!

So let's get started!

Massachusetts Sales Tax Facts

  • The general sales tax rate in Massachusetts levied at the state level is 6.25%. Fortunately, no county or city is allowed to level any additional sales tax, so the same sales tax rate would be applied regardless of where you are in the state.
  • The sales tax rate in Massachusetts is higher than 63.5% of states in the U.S.
  • Meanwhile, no special sales tax rate is levied in Massachusetts.
  • Admissions sales, newspapers, most health care products, most prescription drugs, clothing items including shoes, jackets, and even costumes under $175, food, heating fuel, professional or personal services, and most utilities are exempted from MA Sales Tax.
  • The state has one sales tax holiday, where certain tangible personal properties (TPP) are exempted from sales tax from August 10th to August 11th each year.
  • Individuals and companies can use a Massachusetts Sales Tax Exemption Form to buy goods for resale, improvement, or as raw materials without paying sales tax.
  • Online and out-of-state purchases that are not subjected to MA Sales Tax by a retailer are supposed to be subjected to Massachusetts Use Tax, which is to be paid by the user.

How to calculate Sales Tax in Massachusetts?

Businesses and Sellers engaged in the retail sale or rental of tangible personal property (TPP), (including gas, electricity, and steam) and certain telecommunications services and have Nexus in Massachusetts are required to collect MD Sales tax from the buyer.

Businesses and Sellers are required to register, collect, manage, and transfers the sales tax to the Massachusetts Department of Revenue while staying in compliance with state laws and avoid penalties and interest. However, sales tax on a motor vehicle and trailer sales is directly collected by the Massachusetts Department of Revenue from the buyer.


The sales tax determined on four factors:

  1. Nexus: It is a connection of business with a state. The business is only liable to pay taxes to the states with Nexus.
  2. Out of State (Internet), Seller's Eligibility: Out of State Seller is only required to register, collect, and remit the sales tax to the state's authorities if it falls under the criteria provided by the state.
  3. Location and Products or Services: The sales tax rate varies from product to product and location to location. However, no sales tax is charged locally in Massachusetts, so that the sales tax rate would remain the same in MD, regardless of location.
  • Exemptions: Almost all goods are eligible for sales tax regulation. However, Admissions sales, newspapers, most health care products, most prescription drugs, clothing items including shoes, jackets, and even costumes under $175, raw food, heating fuel, professional or personal services, and most utilities are exempted from MA Sales Tax. You should check with the Massachusetts state government as to which goods and services sold in Massachusetts are subject to sales tax.

To calculate Sales Tax in Massachusetts, follow the steps below:


Step 1 – Determine your Nexus:

As a business owner, you are only required to collect sales tax if you are eligible for collecting sales tax and have Sales Tax Nexus in the Massachusetts State. And to determine your Nexus in Massachusetts, you must have any of the following:

  • Selling, renting or leasing a tangible personal property (TPP) or taxable service in the state directly or indirectly through an agent or subsidiary;
  • Maintaining a business location like office, warehouse, sample room, distribution, storage, and repair facility in Massachusetts;
  • Involved in buying tangible personal property or telecommunications services for resale in MA;
  • Having employees or representatives who request and accept orders, as well as involved in selling, repairing, delivering tangible personal property (TPP) or telecommunications service in the state;

Step 2 – Determine the eligibility to collect sales tax as an out-of-state Internet seller:

Out of State Internet Seller is eligible to register, collect and remit sales tax under Massachusetts Law, if:

  1. The out of state Internet seller has a gross revenue exceeding $500,000 into Massachusetts by selling delivering tangible personal property (TPP) or taxable service completed over the internet during the preceding 12 months;
  2. OR, Makes 100 or more sales of delivering tangible personal property (TPP) or taxable service in Massachusetts in the preceding calendar year.

Step 3 – Determine the Sales Tax Rate:

Once you have determined that your Nexus is with Massachusetts, next is to deduce the Sales Tax rate (State) applicable to your product. As no city or county in Massachusetts levy local sales tax, so sales tax rate remains the same throughout Massachusetts.

Step 4 – Calculate Sales Tax:

After determining the sales tax rate according to the location and type of purchases, it is easy to calculate the sales tax amount charged on the product and gross price (amount after tax) of a product.


Example # 1:

For instance, you are selling a Leather Jacket on your store in Springfield, Massachusetts, having a net price tag of $100. The amount that a buyer has to pay (including sales tax) on a check out would be:


Manual Method:

Net Price (amount before Tax) of a Leather Jacket: $100

Total Sales Tax rate: 0.00% (Springfield) + 0.00% (Hampden County) + 6.25% (Massachusetts State) = 6.25%


Total Sales Tax amount = $100 x 6.25% = $6.25

Gross Price (Amount after Tax) = 100 + 6.25 = $106.25


It means the amount the buyer has to pay for a Leather Jacket on a cash counter would be $106.25.


Using our Sales Tax Calculator:

All of the steps mentioned above can be skipped to get an instant result using our Sales Tax Calculator. All you need is:

  1. Input the $100 Net Price of a Leather Jacket as Amount Before Tax
  2. Input or select 25% of the combined Sales Tax rate on the Tax Rate menu.

Our calculator will automatically calculate the result, and represents it in 3 different forms, as shown in the image below:

massachusetts-sales-tax-calculator

Reverse Sales Tax Calculation

In the example above, we have explained to you to calculate the Sales Tax amount payable in a product, and the Gross Price of the Product.

But there are also instances when you are required to deduce how much sales tax buyer has actually paid on a product or you may want to check the accuracy of the sales tax indicated on your item's receipt.

This is where the Reverse Sales Tax Calculation Kicks in. And luckily, our Massachusetts Sales Tax Calculator can perform this calculation like a Pro.


Example:

Your buyer has paid $55 for a Dress Shoes at your store in Barnstable, Massachusetts. Now the buyer is inquiring how much a dress shoe actually cost before the sales tax was added. So you need to follow the steps below to determine the amount before tax (net price) of a dress shoe:

Gross Price (Amount after Tax) of Dress Shoes: $55

Total Sales Tax rate: 0.00% (Barnstable) + 0.00% (Barnstable County) + 6.25% (Massachusetts State) = 6.25%


Manual Method:

Gross Price with sales tax = [Net Price × (tax rate in decimal form + 1)]

55 = [Net Price x ((6.25/100) + 1)]

55 = Net Price x 1.06

$51.9 = Net Price


So the original Price (net price) of the Dress Shoes was $51.9.

Using our Sales Tax Calculator:

You can also use our Sales Tax Calculator for Reverse Sales Tax calculation to skip the aforementioned manual method. All you need is:

  1. Input the $55 Gross Price of Dress Shoes as Amount after Tax
  2. Input or select 6.25% of the combined Sales Tax Rate on the Tax Rate

Our calculator will automatically calculate the result and represents it in 3 different forms.

Also Check: Massachusetts Paycheck Calculator to Calculate your Paycheck in Massachusetts State including all taxes and take home pay.

FAQs

Answer: Almost all tangible personal property (TPP), including gas, electricity, steam, furniture, home appliances, and motor vehicles and certain telecommunications services, are subjected to sales tax in Massachusetts.

Answer: The general sales tax rate in Massachusetts levied at the state level is 6.25%. Fortunately, no county or city is allowed to level any additional sales tax.

Answer: The Massachusetts sales tax on cars is 6.25% if sales are made a motor vehicle dealer or lessor who is registered,

Answer: All the sellers who have sales tax nexus in Massachusetts like owning a personal property such as office, inventory in the warehouse, employee present in Massachusetts are required to pay sales tax.

Answer: Prepared meal sold by, or bought from a restaurant, or any restaurant within any store is subjected to 6.25% of Massachusetts sales tax. However, food like groceries for personal consumption is exempted.

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