Who Cannot Apportion Income?
If you know the actual amount of your Massachusetts source income, do not apportion. Report your income taxable in Massachusetts on your Massachusetts return. Examples of nonresidents who cannot apportion include:
- An employee whose actual Massachusetts income is shown on Form W-2;
- An employee whose Form W-2 does not indicate initially his/her actual Massachusetts income but whose employer issues a corrected Form W-2 or other statement which breaks down this amount. Since your employer is required by law to withhold Massachusetts tax on your Massachusetts wages, this breakdown will be easy to obtain; and
- A self-employed person whose actual Massachusetts income is known, such as a surgeon who comes to Massachusetts to perform a specific operation for a set fee.
In the few cases when your employer fails to issue a separate Form W-2 that includes only Massachusetts earnings, you may use the Nonresident Apportionment Worksheet to adjust your earnings.
Who Must Use the Nonresident Apportionment Worksheet?
If your employment or business took you both inside and outside Massachusetts and you do not know the actual amount of income you earned in Massachusetts, you must use the Nonresident Apportionment Worksheet if you are a self-employed person or employee who is on an hourly, daily, weekly, monthly or mileage basis, or whose compensation depends upon sales, at least some of which take place outside of Massachusetts you must use the Nonresident Apportionment Worksheet.
Note: If both you and your spouse both qualify to apportion your income or you have more than one job that is eligible for apportionment, you must complete a separate apportionment worksheet for the income that is eligible to be apportioned
Who Can Apportion Income But Cannot Use the Nonresident Apportionment Worksheet?
If you do not know the actual amount of income you earned in Massachusetts from one business or employment, but you do not fit into any of the categories listed in the preceding section, you should not use the Nonresident Apportionment Worksheet. See the section on Special Apportionment Methods for your apportionment method.
Examples of nonresidents who must apportion income using one of these special methods include:
- An independent business or professional person whose income does not depend on sales, days or mileage;
- An entertainer or athlete whose income does not depend solely on receipts or winnings;
- A general or limited partner in a partnership; and
- A shareholder of an S corporation with Massachusetts source income.
Please see the mass.gov website for more information.