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You made a point in a thread on the budgetting forum that MA taxes out of state interest (ING, Emigrant, etc) at 12%.

Now, even with this I am *much* better off at one of those than at my local bank, but I was concerned, so I did some research and it appears that that law is no longer true. I responded as such on the tread to get your opinion but there was never a response. I noticed you were here, as are many knowledgeable people, so I thought I'd repost and see if we could get to the bottom of this.


[links and references to MA tax rules snipped]

Now I will note that there's a $100 exception for in-state interest which does not exist for out of state, but at these apparent rates that's only $5.30, which is muc less than the difference I gain by moving it to Emigrant.

So, is out of state interest now only taxed at 5.3% also, or am I confused?


You are not confused. MA currently taxes all interest at 5.3% (but allows the first $100 of MA-source interest tax free). Some other income is still taxed at 12%.

Ira
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