State guide · Massachusetts · 2026 rules
S corporation in Massachusetts: what the election changes
Massachusetts adds a minimum corporate excise and several payroll contributions on your salary.
Choose a state and enter your profit and salary to see the comparison.
The corporate excise
A Massachusetts S corporation pays the greater of $456 or $2.60 per $1,000 of taxable tangible property or net worth. With total receipts under $6 million it pays no income-based excise. A disregarded single-member LLC or sole proprietorship owes none.
Payroll contributions on your salary
Unemployment insurance: 2.42% for a new employer on the first $15,000 of wages in 2026; new employers are exempt from the COVID-19 Recovery Assessment. An LLC that elects to be a corporation is legally distinct from its officers for unemployment purposes.
Paid Family and Medical Leave: 0.46% of wages for an employer with fewer than 25 covered individuals, all of which may be withheld. Workforce Training Fund: 0.056% on the first $15,000. A one-owner S corporation is exempt from the Employer Medical Assistance Contribution.
The optional pass-through entity excise
The 5% excise is elected on the timely original Form 355S and confirmed with Form 63-ELT by the return due date (March 15 for a calendar year). Members claim a 90% credit. The calculator leaves it out.
Worked examples
A single-member LLC owner, single filer, 22% federal bracket, default payroll and return costs. The figure is total tax and added costs as an S corporation compared with staying as you are.
| Profit / salary | Statewide |
|---|---|
| $80,000 / $45,000 | about even |
| $120,000 / $60,000 | $2,379 lower |
| $200,000 / $90,000 | $7,021 lower |
Starting payroll in Massachusetts
Register for withholding and paid leave in MassTaxConnect, and for unemployment insurance in Unemployment Services for Employers.
Other states
- Alabama
- Alaska
- Arizona
- Arkansas
- California
- Colorado
- Connecticut
- Delaware
- Florida
- Georgia
- Hawaii
- Idaho
- Illinois
- Indiana
- Iowa
- Kansas
- Kentucky
- Louisiana
- Maine
- Maryland
- Massachusetts
- Michigan
- Minnesota
- Mississippi
- Missouri
- Montana
- Nebraska
- Nevada
- New Hampshire
- New Jersey
- New Mexico
- New York
- North Carolina
- North Dakota
- Ohio
- Oklahoma
- Oregon
- Pennsylvania
- Rhode Island
- South Carolina
- South Dakota
- Tennessee
- Texas
- Utah
- Vermont
- Virginia
- Washington
- Washington, DC
- West Virginia
- Wisconsin
- Wyoming
Sources
- M.G.L. c. 63, §39(b)
- M.G.L. c. 63, §32D(a)(ii)
- M.G.L. c. 63D, §2
- M.G.L. c. 63D, §1
- M.G.L. c. 63D, §6
- Mass. DOR, Elective pass-through entity excise (updated July 31, 2026; archive.org capture 2026-10-23)
- M.G.L. c. 151A, §14(a)(4)
- Mass. DUA, Employer contributions to unemployment
- Mass. Board of Review decision, Issue ID 0035 1763 93 (LLC taxed as S corporation; G.L. c. 151A §§1(s)(A), 24(a))
- Mass. DUA, Employer’s Guide to Unemployment Insurance (2017)
- Mass. DUA, 2026 UI & COVID-19 Recovery Assessment Rate Schedule (archive.org copy)
- Mass. DUA, COVID-19 Recovery Assessment rates (archive.org capture 2026-10-05)
- Mass. DFML, PFML employer contribution rates and calculator (updated Oct. 1, 2026)
- M.G.L. c. 175M, §1
- M.G.L. c. 151A, §14L(a)
- Mass. DUA, Employer medical assistance contribution (EMAC) (archive.org capture 2026-10-05)
Federal figures: IRS Publication 15 (2026), Schedule SE and Form 2553 instructions. Every figure was read on an official page and checked a second time. Checked October 24, 2026. How we check facts.