No. New Hampshire does not have a personal income tax. The state’s last remaining personal-level tax, on interest and dividends, was fully repealed on January 1, 2025, which means wages, salaries, retirement distributions, capital gains, and investment income are all untouched at the state level.1NH Department of Revenue Administration. Repeal of NH Interest and Dividends Tax Now in Effect Federal income tax still applies to every resident, and businesses operating in the state face two separate state-level business taxes, so “no income tax” is the headline rather than the whole picture.
What New Hampshire Does Not Tax
New Hampshire does not tax wages, salaries, tips, or any other form of personal compensation. Employers are not required to withhold state income tax from paychecks, so your payroll deductions include only federal income tax, Social Security, and Medicare.2NH Department of Revenue Administration. Laws and Rules The same is true whether you live in the state full-time or work in New Hampshire as a nonresident.
Since the 2025 repeal, the state also collects nothing on savings account interest, certificates of deposit, stock dividends, or other investment income.1NH Department of Revenue Administration. Repeal of NH Interest and Dividends Tax Now in Effect Capital gains, pensions, Social Security benefits, and IRA withdrawals are likewise untaxed at the state level. For individual residents, New Hampshire now collects no direct tax on any form of personal income.
The Interest and Dividends Tax Repeal
For decades, New Hampshire taxed interest and dividend income under RSA 77:4, covering income from bonds, bank interest, and corporate dividends.3New Hampshire General Court. New Hampshire Code 77-4 – What Taxable The rate was 5% through 2022, dropped to 4% for 2023, and fell to 3% for 2024 as part of a legislated phase-out.4NH Department of Revenue Administration. Interest and Dividends Tax Frequently Asked Questions House Bill 2, signed by Governor Sununu during the 2023 legislative session, set the final repeal date at January 1, 2025.1NH Department of Revenue Administration. Repeal of NH Interest and Dividends Tax Now in Effect
If you still owe a return for 2024 or an earlier year, that obligation has not disappeared. Tax periods beginning on or before December 31, 2024, remain subject to audit and collection. The Department of Revenue Administration will not issue 2025 I&D forms because no return is required, and anyone who accidentally made estimated I&D payments for 2025 should request a refund in writing.1NH Department of Revenue Administration. Repeal of NH Interest and Dividends Tax Now in Effect
Business Taxes That Catch Self-Employed Residents
The absence of a personal income tax does not mean self-employed residents pay nothing to the state. New Hampshire imposes two business-level taxes, and freelancers, sole proprietors, and single-member LLCs can fall into them without realizing it.
Business Profits Tax
The Business Profits Tax applies to every business organization, including corporations, LLCs, partnerships, sole proprietorships, and associations, with gross income exceeding $109,000 from New Hampshire sources. The current rate is 7.5% of net business income.5NH Department of Revenue Administration. Business Taxes If your business grosses more than $109,000, you owe this tax even though your personal wages are untouched.6NH Department of Revenue Administration. Business Profits Tax Frequently Asked Questions
Business Enterprise Tax
The Business Enterprise Tax is a separate levy at 0.55% applied to the enterprise value tax base, which generally includes compensation paid to employees, interest paid, and dividends paid. You owe it even in years with no net profit. Businesses can credit the BET they pay against their BPT liability for the same period, so the two taxes overlap in most cases rather than stacking.7NH Department of Revenue Administration. Business Enterprise Tax Frequently Asked Questions
Federal Taxes Still Apply
Living in a state with no income tax does not reduce what you owe the IRS. Every New Hampshire resident who meets the federal filing thresholds must file a federal return and pay federal income tax on all earned and unearned income. Self-employed individuals must file if net earnings reach just $400. Federal marginal rates run from 10% to 37% across seven brackets.8Internal Revenue Service. IRS Releases Tax Inflation Adjustments for Tax Year 2026
Because New Hampshire collects nothing at the state level, the only way to adjust your total withholding is through your federal Form W-4. If you moved from a state with an income tax and kept the same salary, your take-home pay will rise, but your federal obligation stays the same. Review your W-4 after any move so your withholding still matches what you’ll owe in April.9Internal Revenue Service. Employees Withholding Certificate
Investment Income
The repeal of the state I&D tax eliminated only the New Hampshire layer. Federal taxes still apply to every dollar of interest and dividends you earn. Ordinary interest from savings accounts and CDs, along with nonqualified dividends, is taxed at your regular federal rate. Qualified dividends from stocks held for a minimum period receive preferential federal treatment at 0%, 15%, or 20% depending on your taxable income. An additional 3.8% Net Investment Income Tax applies if your modified adjusted gross income exceeds $200,000 as a single filer or $250,000 filing jointly.
Payroll and Self-Employment
New Hampshire employees pay the same federal payroll taxes as workers everywhere else. Social Security tax is withheld at 6.2% on earnings up to $184,500 in 2026, and Medicare tax is withheld at 1.45% on all earnings with no cap.10Social Security Administration. Contribution and Benefit Base Your employer matches both. Employees earning over $200,000 also pay an additional 0.9% Medicare surtax that the employer does not match.
Self-employed residents pay the combined employer-and-employee share of 15.3% on net self-employment income (12.4% for Social Security up to the wage base, plus 2.9% for Medicare). That hits on top of any Business Profits Tax owed to the state. Half of the self-employment tax is deductible when calculating your federal adjusted gross income, but the cash outlay still lands in full at estimated-tax time.
How the State Raises Revenue Instead
Without a personal income tax or a general sales tax, New Hampshire leans on a different mix.11NH Department of Revenue Administration. Does New Hampshire Have a Sales Tax Property taxes carry the heaviest load. The effective property tax rate on owner-occupied homes sits at roughly 1.4%, among the highest in the country, because local governments depend on it to fund schools, roads, and public services.
The state also collects an 8.5% Meals and Rooms Tax on restaurant meals, hotel stays, and short-term rentals, which applies to both residents and visitors. There is no general sales tax on goods purchased in the state.11NH Department of Revenue Administration. Does New Hampshire Have a Sales Tax
Remote Workers With Out-of-State Employers
The lack of a state income tax creates complications if you work remotely from New Hampshire for an employer based in a state that does tax income. A handful of states apply what is sometimes called the “convenience of the employer” rule, which tries to tax your income based on where your employer’s office sits rather than where you physically work. Massachusetts attempted this during the pandemic with New Hampshire remote workers, and the dispute prompted New Hampshire to pass a protective statute.
Under that law, income earned by New Hampshire residents for work performed entirely within the state cannot be subject to another state’s personal income tax. The practical effect is that New Hampshire has declared its intent to fight these claims on behalf of its residents, although interstate tax disputes ultimately involve the laws and enforcement posture of the other state. If you work remotely from New Hampshire for a company in New York, Massachusetts, or Connecticut, talk to a tax professional. You may need to file a nonresident return in your employer’s state even if you dispute the obligation.
Estate and Inheritance Tax
New Hampshire does not impose a state-level estate tax or inheritance tax. The state’s legacy and succession taxes were repealed for deaths occurring on or after January 1, 2003, and no state estate tax return has been required for deaths since January 1, 2005.12NH Department of Revenue Administration. Inheritance and Estate Taxes Frequently Asked Questions Federal estate tax still applies if your estate exceeds the federal exemption, which is $15,000,000 per individual for 2026.13Internal Revenue Service. Estate Tax Married couples can effectively shield up to $30,000,000 combined through portability of the unused exemption.