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Key Facts
- New Hampshire state level: New Hampshire does not impose a broad state individual income tax on wages.
- New Hampshire state level: The former Interest and Dividends Tax was repealed effective January 1, 2025.
- New Hampshire state level: Taxpayers can still face filing, audit, refund, and collection matters for periods governed by the former Interest and Dividends Tax.
- New Hampshire state level: Businesses can owe the Business Profits Tax and Business Enterprise Tax even though the state lacks a broad wage income tax.
- New Hampshire state level: Local real-property taxes and state-administered meals, rooms, tobacco, real-estate-transfer, and other taxes remain separate.
New Hampshire is commonly described as having no state income tax. For individuals earning wages, that shorthand is generally accurate, but it can hide important distinctions. The state repealed its separate tax on interest and dividends in 2025, while retaining business, consumption, transfer, and locally administered property taxes. The broader American tax system overview provides context for these separate government layers.
No broad New Hampshire tax on wages
New Hampshire does not require a general individual income-tax return merely because a resident earned wages, salary, or self-employment income. Federal income tax still applies.
The absence of a broad wage tax does not make every payment tax-free. A business owner may face entity-level New Hampshire taxes, an employer still administers federal payroll taxes, and property or transactions can fall within other state and local tax systems.
The Interest and Dividends Tax ended in 2025
New Hampshire’s former RSA Chapter 77 imposed a limited tax on specified interest and dividend income rather than wages. The Department of Revenue Administration confirms that the tax was repealed effective January 1, 2025.
The repeal generally means interest and dividends received in taxable periods beginning on or after January 1, 2025 are not subject to that former tax. Historical liability did not disappear. Returns, amendments, audits, credit balances, refunds, and collection for earlier taxable periods remain governed by the law applicable to those periods.
Proposals to reinstate a tax are not current law merely because a bill was introduced. Current status must be checked against enacted legislation, the current Revised Statutes, and Department guidance.
Federal income tax still applies
New Hampshire residency does not eliminate federal income tax. Wages, business income, interest, dividends, gains, retirement distributions, and other income remain subject to the Internal Revenue Code unless a federal exclusion applies.
Residents generally handle federal income tax through withholding, estimated payments, and Form 1040. The federal return can also matter as a starting record for business taxes, but federal treatment does not itself establish a New Hampshire deduction or exemption.
Business Profits Tax
The Business Profits Tax is imposed under RSA Chapter 77-A on taxable business profits, with detailed rules defining business organizations, nexus, apportionment, additions, deductions, and credits. It can apply to corporations, partnerships, proprietorships, and limited liability companies when statutory thresholds and connections are met.
Taxable business profits are not simply cash in a bank account. The calculation begins with federally based measures and applies New Hampshire modifications and apportionment. Proprietors, partners, and LLC members can encounter rules for reasonable compensation and owner services.
A business return obligation can therefore exist even though the owner owes no New Hampshire individual tax on wages. Entity classification and federal pass-through treatment do not automatically eliminate the state business tax.
Business Enterprise Tax
The Business Enterprise Tax under RSA Chapter 77-E uses a value-added tax base rather than net profit. Its enterprise value tax base generally involves compensation, interest, and dividends, subject to statutory definitions and adjustments.
Because the base differs from profit, a business with little or no profit can still have a Business Enterprise Tax filing or payment question. Credits coordinate parts of the Business Enterprise Tax and Business Profits Tax systems, but each return and threshold must be analyzed separately.
Report-year rates and filing thresholds can change. Current Department forms and instructions control the applicable period rather than a rate remembered from an older return.
Meals and Rooms Tax
New Hampshire imposes a Meals and Rooms Tax on covered restaurant meals, hotel and room rentals, and certain motor-vehicle rentals. Operators generally collect the tax from customers and remit it to the Department of Revenue Administration.
Short-term rental operators can fall within meals-and-rooms rules even when they do not view themselves as traditional hotels. Marketplace collection, licensing, filing, and recordkeeping depend on the current statute and Department guidance.
Real estate and property taxes
New Hampshire real-property tax is primarily administered locally. Municipal assessing officials determine assessments under state law, while local tax rates and bills reflect municipal, school, county, and state education components.
Owning a home therefore can produce substantial local property tax even without state wage income tax. Assessment, exemption, abatement, appeal, and payment procedures follow separate local and state rules.
New Hampshire also imposes a Real Estate Transfer Tax on qualifying transfers of real property or interests in real property. That transaction tax is different from annual property tax and from federal income tax on gain.
Other New Hampshire taxes
The Department administers additional taxes and fees, including tobacco, communications services, electricity consumption, utility property, insurance, and specified business taxes. Which apply depends on the activity, property, industry, and transaction.
New Hampshire does not have a general statewide sales tax, but that does not make every purchase or service free from state-imposed charges. Meals and rooms, tobacco, motor fuels, and other categories have specialized systems.
Sources
- New Hampshire Department of Revenue Administration: Taxes at a Glance
- Interest and Dividends Tax Repeal
- RSA Chapter 77-A, Business Profits Tax
- RSA Chapter 77-E, Business Enterprise Tax
- New Hampshire Meals and Rooms Tax
- New Hampshire Real Estate Transfer Tax
- New Hampshire Property Tax
- IRS Publication 17, Your Federal Income Tax
