Massachusetts Question 5 Sets New Tax Refund Formula
Voters on the 2026 ballot will decide whether to change how the state calculates excess tax revenue returned to taxpayers.
Updated on Nov. 3, 2026 in Taxes
Live Poll
Should Massachusetts return more excess tax revenue to residents as refunds?
Massachusetts Question 5 would establish a new formula for determining when the state must return excess tax revenue to taxpayers. A "no" vote keeps the current system in place, while a "yes" vote adopts the new formula.
Why it matters
The measure would change the trigger for refunds that residents of Massachusetts have seen only twice in 40 years. Supporters say revenue spikes leave excess funds that could be returned, while opponents argue the state needs that revenue for education and healthcare.
The current system returns excess tax revenue through refunds when the state exceeds its annual tax revenue cap, a provision triggered only twice in the past 40 years. Question 5 would base the calculation on the previous year's tax revenue plus recent wage and salary growth, adding revenue from the millionaires tax.
The players
Evan Horowitz
Evan Horowitz is executive director of the Center for State Policy Analysis at Tufts University, a research center that studies state-level fiscal policy.
The details
Question 5 would base the excess-revenue calculation on the prior year's tax revenue combined with recent wage and salary growth, and would account for additional revenue generated by the state's millionaires tax. If approved by voters, the change would take effect next July.
Timeline
Forty years ago: Voters approved returning excess tax revenue to taxpayers as refunds.
November 3, 2026: Massachusetts voters decide Question 5 on the ballot.
Next July: Question 5 would take effect if approved.
Roadmap
Question 5 would revise the 40-year-old voter-approved system for returning excess tax revenue in Massachusetts. The measure reflects a debate over whether revenue surges from events like stock market gains should be refunded or retained for public services.
If Question 5 passes, Massachusetts taxpayers could receive refunds under a new formula that uses prior-year revenue, wage growth, and millionaires tax collections. Residents should note that the refund trigger would change from the current rule that has been met only twice in four decades.
The takeaway
Massachusetts voters on November 3, 2026 will decide whether the state's excess tax revenue refund rules change. Residents following state tax policy should watch how the new formula would affect their future refunds.
What happens next
If voters approve Question 5, the new formula would take effect next July.
Further reading
Explore more on Massachusetts taxes and how state refund rules work.
Live Poll
Should Massachusetts return more excess tax revenue to residents as refunds?
