On October 21, 2025, the Commonwealth of Massachusetts Department of Revenue issued a DRAFT of a Technical Information Release regarding how Massachusetts tax law for individuals and businesses will interact with the changes enacted by Public Law No. 119—21 (the OBBBA), passed by the US on July 4, 2025.
For individuals, the draft states that Massachusetts will NOT follow the new law for Tips, Overtime, Car Loan Interest, the full expenses of business property, the new Trump accounts (2026), or the deduction for qualified business income (QBI). Certain business deductions will be followed, such as the limitation of gambling losses, the full expensing of domestic research and experimental expenditures, the increased dollar limitations for expensing certain depreciable business assets, and the special depreciation allowance for qualified production property.
The notice issued last week is a draft and is subject to public comment and change. However, the OBBBA presents a challenge to the state budget so certain Federal changes may not be implemented within Massachusetts.
In Your Corner
OBBBA creates both opportunities and complexities. Careful planning can make a meaningful difference in your long-term tax outlook. LGA’s is here to help you navigate these changes. Contact your LGA advisor today to review your 2025 strategy.
