"Big beautiful" tax cuts mean savings in Mass.
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Massachusetts residents are in line for some of the biggest federal tax cuts in the nation starting next year, with some taxpayers in Greater Boston set to save more than $7,000 on average under Republicans' new tax law.
Why it matters: The One Big Beautiful Bill Act makes permanent the 2017 Trump-era tax cuts and adds new ones — offering meaningful relief to households even as rising prices and interest rates continue to strain budgets, Axios' Emily Peck and Jason Lalljee report.
State of play: The tax law expands deductions for tipped and overtime workers, increases the child tax credit and makes write-offs for business research and equipment purchases permanent.
- The law also caps the state and local tax (SALT) deduction at $40,000 through 2029 — a significant boost for high-tax states like Massachusetts.
By the numbers: Massachusetts taxpayers will see an average tax cut of $5,138 in 2026 — the third highest in the U.S., behind only Wyoming and Washington, according to the Tax Foundation, a nonpartisan research group usually in support of lower taxes.
- In Middlesex County, home to tech hubs and affluent suburbs, the average tax cut comes in at $7,085.
- Norfolk County, which includes Quincy and Brookline, gets a $7,004 average cut.
- Boston's Suffolk County will see an average of $5,750 in savings.
- Areas with relatively lower incomes, like Essex County ($4,965) and Barnstable County on Cape Cod ($4,470) will see less savings from the law.
Zoom out: Higher-income communities with more capital income and itemized deductions tend to see bigger benefits under Trump's tax law.
- Adjustments tied to SALT, mortgage interest and the alternative minimum tax combine to boost the savings for wealthier communities.
- Business owners are also big winners thanks to extended tax breaks for R&D and equipment.
Reality check: Part of the tax savings trade-off is slashes to services for the poor, like future spending on food assistance and Medicaid.
- Those kick in in 2027 and could outweigh whatever tax benefits low-income Americans see from the new law.
What's next: Unless Congress extends them, some Trump tax breaks, like those on tips, overtime and the child tax credit, are set to expire by 2030.