Massachusetts Accelerates Sales Tax Remittance

As a part of its 2021 budget bill, Massachusetts now requires certain businesses to make advance payments (i.e., prepayments or accelerated payments) on reported sales tax or room occupancy and meals tax.  

Effective April 1, 2021, businesses with more than $150,000 in sales tax liability in the previous calendar year are required to remit taxes for sales made during the first 21 days of the month by the 25th day of the month. Affected businesses must remit the remainder of the sales tax for the month when they file the return for the period.

Before this change, the entire amount of sales tax reported for the month was due to be paid at the same time the return was filed, on the 30th day following the tax period. The due dates for filing returns were unaffected by the change in payment due dates.

A 5% underpayment penalty will be imposed, unless the underpayment is due to reasonable cause, if the advanced payment is less than the amount of advance payment due or 70% of the total tax reported during the filing period.




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