Does New Hampshire have a state income tax? No. Here is what New Hampshire taxes instead

Not on individuals’ personal income for 2025 and later. The Department of Revenue Administration says New Hampshire “does not have an income tax on an individual’s reported W-2 wages”, and the interest and dividends tax, the state’s only tax on personal income, ended for taxable periods beginning after December 31, 2024. So wages, Social Security, pensions, interest, dividends and capital gains are not taxed by the state, and employers withhold only federal tax.

Business income is the exception. Self-employed people, landlords and other businesses over the filing thresholds pay New Hampshire’s Business Profits Tax and Business Enterprise Tax, on business returns, as explained below.

New Hampshire taxed interest and dividends above $2,400 a year ($4,800 joint) at 5%, cut to 4% for 2023 and 3% for 2024. A 2021 law repealed the tax, and the 2023 budget moved the repeal up to taxable periods beginning after December 31, 2024. For calendar-year filers, the last return was the 2024 Form DP-10, due April 15, 2025; fiscal-year filers whose year began on or before December 31, 2024 still filed for that year.

Nothing is filed or paid for 2025: there is no 2025 form and no 2025 estimated payments, and estimates paid by mistake are refunded on written request. The repeal is not an amnesty, so unpaid tax for 2024 and earlier years is still owed and can still be audited.

New Hampshire’s constitution does not ban an income tax; it lets the legislature levy “proportional and reasonable” taxes. In 2026 the House voted on two proposed amendments to ban a personal income tax (CACR 10 and CACR 12), and both fell short of the three-fifths vote needed. Neither is on the November 3, 2026 ballot, which has no income tax question.

The Business Profits Tax is 7.5% of business profits. For tax years beginning in 2025 and 2026, any business organization with more than $109,000 of gross business income from all its activities must file, even if it made no profit. That includes sole proprietors and single-member LLCs, which file Form NH-1040, a business return and not a personal income tax return. Rental property counts too: gross rents go toward the $109,000 test, and net rental profit is business profit.

Owners can deduct a reasonable amount of compensation for their own work, which often brings a small business’s taxable profit down a lot (records are needed above $75,000). Partnerships, LLCs and S corporations pay at the business level, not on the owners’ returns. The threshold is adjusted every two years.

The Business Enterprise Tax is 0.55% of a business’s enterprise value tax base: the wages and other compensation, interest and dividends it pays. For 2025 and 2026 a business files if gross receipts or that base are over $298,000; a 2026 law raises both thresholds to $400,000 from January 1, 2027. Business Enterprise Tax paid is a credit against the Business Profits Tax, and the two thresholds are tested separately, so a business can owe one and not the other.

New Hampshire has no general sales tax. It does charge 8.5% on restaurant meals, hotel and other room rentals, including short-term rentals, and car rentals, collected by the business; hosts and restaurants need a state license before they start.

Property tax is set and collected by each town and city, and New Hampshire relies on it heavily. Each bill combines town, county, local school and state education rates; for 2025 the total ran from under $7 per $1,000 of assessed value in some towns to over $33 in others. The statewide education property tax is $1.12 per $1,000 of equalized value for the tax year starting April 1, 2025 and $1.03 for 2026, which each town converts to its own rate.

Massachusetts, Maine and Vermont tax nonresidents on wages for work done in their state, and New Hampshire has no tax to credit against it. Massachusetts splits your pay by the days you actually work in Massachusetts compared with all working days; days you work from home in New Hampshire are not Massachusetts days, and a day split between the two counts as a Massachusetts day unless you worked more than half of it outside Massachusetts. Keep a log of where you work.

During the pandemic, Massachusetts kept taxing former commuters working from home in New Hampshire; that rule ended September 13, 2021, and on June 28, 2021 the U.S. Supreme Court declined to hear New Hampshire’s challenge to it. Maine taxes nonresidents who work there more than 12 days and earn over $3,000 there, and Vermont taxes pay for work done in Vermont.

Moving ends Massachusetts tax only once you change your domicile. Massachusetts says you keep your domicile until you establish a new one, that the burden of proving the change is on you, and that it looks at ties such as your home, voter registration, driver’s license and where your children go to school. Even after a move, keeping a home in Massachusetts and spending more than 183 days there makes you a full-year resident.

In the year you move you file Massachusetts Form 1-NR/PY, and income you earned while still a resident stays taxable there. After that, Massachusetts still taxes pay for days you work in Massachusetts.

New Hampshire employers withhold only federal taxes, plus Massachusetts, Maine or Vermont tax for work done there. They pay state unemployment tax on the first $14,000 of each employee’s wages. New employers start at 2.7%, reduced by 1 percentage point every quarter of 2025 and 2026 because the trust fund is above its target, so they actually paid 1.7%. Wages also count toward the Business Enterprise Tax base.

New Hampshire residents file a federal Form 1040 when their income requires it, plus a New Hampshire business return if they have business or rental income over the thresholds above, and a nonresident return in any other state where they earned wages. There is no New Hampshire personal refund to track, so use the IRS “Where’s My Refund?” tool, which shows a status about 24 hours after you e-file or four weeks after you mail a paper return.