Determination engine

Which state do you actually withhold in?

Reciprocity, convenience-of-the-employer, nonresident thresholds and unemployment localization, applied together to one employee's facts. Every answer cites the state source it came from.

Withhold Massachusetts income tax.

The work state does not tax these wages, so the residence state governs.

Income tax withheld to

Massachusetts

Graduated, top rate 9%

Employee certificate

M-4

Massachusetts Employee's Withholding Exemption Certificate

Unemployment insurance

New Hampshire

Localized under factor 1: Localization.

Reciprocal agreement

New Hampshire has no reciprocal agreements.

✓

No New Hampshire withholding

New Hampshire has no personal income tax on wages, so nothing is withheld for the work state.

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Massachusetts still taxes this income

A resident state taxes its residents on all income regardless of where it is earned. If you have nexus in Massachusetts you should register and withhold Massachusetts tax; if you do not, the employee must cover it through estimated payments.

Massachusetts also runs a paid leave program

The employee resides in Massachusetts, which has a mandatory paid leave program, but unemployment coverage is localized to New Hampshire. Check whether Massachusetts requires coverage based on residence; several programs use a work-location test and a few do not.

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Employer registrations you will need

Massachusetts — Income tax withholding: Massachusetts Department of Revenue
New Hampshire — Unemployment insurance: New Hampshire Employment Security

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Get the form

M-4 — New Hampshire (official state source)

New Hampshire profile Massachusetts profile Full write-up for this pair

Change the inputs

Withholding determination

Answer six questions. The result is a shareable link, so you can paste it into a ticket or an email.

Employee lives inState of residence

Work is performed inWhere the employee physically sits

Employer is based inWhere the work is directed from

Days in the work stateThis calendar year, leave blank if unknown

Wages from work-state daysUS dollars, leave blank if unknown

Arrangement Works remotely rather than at an employer location Remote work is an employer necessity, not employee preference

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This is a determination aid, not advice. StateSide encodes published state rules and applies them mechanically to the facts you enter. It does not know your entity structure, your nexus history, your equity compensation, or the dozens of exceptions that turn a clean rule into a judgement call. Every determination cites the state source it came from — verify against that source, and take anything consequential to a payroll tax professional before you act on it.