Massachusetts Estate Tax Nonresident Guide
Last updated: 18 Oct 2025 • Author: Alexander Foelsche CPA (US), WP (DE), RE (CH)
Massachusetts Estate Tax — Nonresident Guide
For estates of decedents domiciled outside Massachusetts that own Massachusetts-situs assets. This page explains who must file, what’s taxable, how apportionment limits the tax to Massachusetts property, deadlines & extensions, payment, lien releases, and practical checklists for Form M-706.
Do you need to file as a nonresident?
What counts as Massachusetts-situs property?
| Asset type | Taxed by Massachusetts? | Notes |
|---|---|---|
| Real property located in Massachusetts | Yes | Homes, condos, land, commercial property. Appraisals recommended. |
| Tangible personal property kept in MA | Yes | Boats, vehicles, equipment, artwork physically in Massachusetts. |
| Intangibles (stock, bonds, cash, brokerage) | Generally no | Usually excluded for nonresidents unless tied to a Massachusetts business situs. |
| Entity interests (LLC/partnership/corp) | Generally no | Treated as intangibles; avoid MA-centered management or records that could imply business situs. |
How Massachusetts limits tax to the MA portion
- Step 1: Compute the estate tax as if the decedent were a Massachusetts resident (federalized base with MA adjustments, $2M exclusion, anti-cliff credit).
- Step 2: Multiply by a fraction: MA-situs real & tangible property ÷ federal gross estate (with Massachusetts adjustments). The result is the Massachusetts tax due.
- Deductions: Administration expenses, debts, and other deductions should be properly documented and, for nonresidents, reasonably connected to the MA-reported property.
Result: accurate location/valuation evidence strongly influences the apportionment fraction—and your tax.
Deadlines, extensions & payment
| Item | Timing | Notes |
|---|---|---|
| Form M-706 due | 9 months after death | Same 9-month rule as federal. File even if no federal 706 is required if the MA computation shows tax due or an election is needed. |
| Extension to file | Typically up to 6 months | Attach IRS Form 4768 approval if available or use MA procedure. Filing extension does not extend time to pay. |
| Extension to pay | Separate written request | Interest accrues; security may be required. Distinct from filing extension. |
| How to pay | By the 9-month date | Use e-payment options or check per DOR instructions; retain proof. |
Automatic lien & releases
- Massachusetts estate tax creates an automatic lien on MA real and tangible property at death.
- For closings/refinances, request a Certificate of Release/Discharge from DOR after filing (or provide acceptable security when permitted) and record it with the appropriate Registry of Deeds.
- Spousal survivorship property and sales for value may provide paths to release; confirm the title company’s requirements early.
Core forms (nonresident focus)
Massachusetts forms
- Form M-706 — Massachusetts Estate Tax Return (with apportionment and anti-cliff credit worksheet).
- M-706 Instructions — Annual package with $2M exclusion, credit, nonresident apportionment, and elections (including MA-only QTIP).
- Extensions — Filing extension (attach IRS 4768 if used) and separate request for time to pay.
- Lien discharge request — To clear title for sale/refinance; record at Registry of Deeds.
Federal attachments
- Form 706 pages/schedules (or pro-forma schedules if no federal filing), Forms 712 (life insurance).
- Deeds, appraisals, proof of Massachusetts location; will/trusts; letters of authority.
Follow the current M-706 Instructions for the exact attachment checklist.
Quick examples
Example — Cape Cod cottage to children
Nonresident decedent owns a Cape Cod cottage plus out-of-state investments. The Massachusetts return includes only the cottage (and related deductions) via apportionment; brokerage accounts are typically excluded.
Example — Boat kept in MA to nephew
A boat stored in Massachusetts passes to a nephew. The boat is MA-situs tangible property and is included in the Massachusetts computation even if most assets are outside MA.
Nonresident filing checklist
Documents
- Death certificate; letters of appointment (domicile state and any Massachusetts ancillary).
- List of MA-situs assets with appraisals and location evidence.
- Federal schedules (706/pro-forma), will/trusts, beneficiary designations.
Computations & timing
- Compute the Massachusetts portion on Form M-706; exclude non-MA assets through apportionment.
- Target the 9-month payment date; request an extension to file if needed (and separately, to pay).
- Plan ahead for lien-release steps if a sale/closing is imminent.
FAQs — Nonresident estates
Are nonresidents taxed on brokerage accounts?
Generally no. Intangibles (e.g., brokerage, stock, cash) of a nonresident are usually not Massachusetts-situs unless they acquire a Massachusetts business situs.
Do I have to file if there’s no Massachusetts property?
Usually not. If the decedent had no MA-situs assets, an M-706 filing is not generally required. Verify titles and locations carefully.
What if a federal estate return isn’t required?
You may still need a Massachusetts filing if the MA computation shows tax due. Use federal-style schedules as pro-forma support and follow the M-706 attachment checklist.
How does the $2M exclusion work for nonresidents?
You compute tax as if resident using the $2M exclusion and anti-cliff credit, then apportion so only the MA-situs share is taxed.