You will file your grandson's tax return as a resident of NY because that is where he lives. Then you will need to file a Massachusetts Form 1-NR/PY - Massachusetts Nonresident or Part-Year Resident Income Tax Return. to report his W-2 income from Massachusetts.
The link below has information on filing MA tax returns that you may find useful.
https://www.mass.gov/guides/personal-income-tax-for-nonresidents
