Massachusetts property tax: how Boston's bill is figured

Who sets the value and the rate?

Local assessors decide. Each city and town assessor must “make a fair cash valuation of all the estate, real and personal” (G.L. c. 59, § 38), and values real property as of January 1 each year (§ 2A). The tax goes to the owner of record on January 1 (§ 11).

Assessors classify property. Class one is residential: property used for human habitation with one or more dwelling units (§ 2A). A city may then set different rates for residential and commercial property.

The formula is: (assessed value × rate ÷ 1,000) − exemptions. Boston’s rates for fiscal 2026 are in the table.

Source: City of Boston tax rate history. Fiscal 2027 began July 1, 2026; Boston bills the first two quarters of a year using the prior year’s value and rate, and the new rate appears on the third-quarter bill issued in late December. This article uses fiscal 2026, the latest adopted rate.

What is the residential exemption?

Under § 5C, a city that assesses at full value may choose to exempt part of the value of a taxpayer’s principal residence. The exemption is capped at 35% of the average assessed value of the city’s residential parcels. Boston has adopted it.

Boston says the exemption saved qualified homeowners up to $4,353.74 in fiscal 2026. At $12.40 per $1,000, that equals about $351,000 of value taken off the taxable amount. Other points from the City:

• You must own and live in the home as your primary residence. Only one property qualifies.
• For fiscal 2027, the application deadline is April 1, 2027. Under a recent home rule petition, buyers who recorded a deed and moved in between January 1 and June 30, 2026 may also qualify for the current year.
• The credit appears on the third-quarter bill, issued in late December.
• Taxable value cannot fall below 10% of assessed value after exemptions (§ 5C).

Boston also lists other exemptions (elderly, veteran, blind, hardship and others). If you qualify for more than one, the City applies the one that saves the most.

What is Proposition 2½?

Proposition 2½ (G.L. c. 59, § 21C) has two limits on a city’s total levy:

• Levy ceiling: total taxes cannot exceed 2.5% of the full value of all taxable property in the city.
• Levy limit: the levy can rise only 2.5% a year, plus the tax on new growth, unless voters approve an override or exclusion.

Boston’s own explanation adds that “Proposition 2½ does not limit the year to year growth in individual tax assessments.” Your bill can rise faster than 2.5% if your assessment rises faster than the rest of the city’s.

Example: an $800,000 Boston home

This is an example with an assumed value, using the fiscal 2026 rate. The owner lives in the home and has the residential exemption but no personal exemption.

The surcharge is Boston’s 1% Community Preservation Act charge. The City computes it after deducting $100,000 from the property’s value, then applies the exemptions. Owners who do not live in the home pay tax on the full value with no exemption, which would be $9,920 on the same price.

Payment dates and appeals

Boston bills quarterly. For cities with quarterly payments, state law sets the preliminary installments on August 1 and November 1 and the actual-bill installments on February 1 and May 1 (§ 57C).

To challenge a value, file an abatement application with Boston’s Assessing Department. For fiscal 2027, you can file after the third-quarter bill and no later than February 1, 2027, and only for the current year. The Department has three months to respond. If it refuses, you have three months from the decision to appeal to the Appellate Tax Board (§ 64; Boston’s abatement page). Filing does not delay payment.

For what else you pay at purchase, see closing costs in Massachusetts, the deeds excise and the Boston guide. Lenders often collect the tax through an escrow account.