MA H4975

Phases in Massachusetts conformity with five federal OBBBA tax provisions over two years, with R&E deductions (Section 70302) taking effect for tax year 2026 and four other provisions (business interest limits, depreciation allowances, opportunity zones) delayed until tax year 2027, avoiding a $442 million revenue impact in FY26.

Creates an automatic one-year delay for future federal tax code changes that would impact Massachusetts revenue by more than $20 million, requiring the Commissioner to make this determination within 90 days of enactment.

Expands the existing Pass-Through Entity (PTE) excise to include the 4% high-income surtax, allowing eligible S corporations and partnerships to pay an entity-level tax that helps members bypass the federal SALT deduction cap, estimated to generate over $100 million annually for the state.

Raises the slot machine winnings threshold for W-2G reporting from $1,200 to $2,000, with inflation adjustments, aligning with new federal policy.

Restricts state Opportunity Zone tax benefits to investments located entirely within Massachusetts and adjusts DFML trust fund employer contribution ratios from 40/100 to 100/40.