No tax on wages/salaries (Interest & Dividends Tax repealed 2024 - fully eliminated)
New Hampshire has 0% state income tax on wages and salaries - one of only 9 US states with no income tax. At $100,000 income, New Hampshire residents pay $0 state tax plus $12,908 federal tax. NH was unique until 2024 for having 0% wage tax but 3% Interest & Dividends Tax (I&D Tax) on investment income; that tax was fully repealed effective January 2024, making NH a true 0% income tax state. This makes NH extremely attractive to MA border workers (save 5% MA tax), retirees with investment income, and high earners seeking tax efficiency.
New Hampshire has 0% state income tax on wages, salaries, and business income - making it one of only 9 US states with no income tax (TX, FL, TN, WY, SD, NV, AK, WA, NH). At $100K income, you pay $0 state tax - significantly better than Vermont (3.35-8.75%), Maine (5.8-7.15%), Massachusetts (5%), and Connecticut (3-6.99%). This makes NH the most tax-efficient state in New England.
Unique history - Interest & Dividends Tax repealed 2024: New Hampshire was unique among no-income-tax states until 2024: it had 0% tax on wages BUT levied a 3% Interest & Dividends Tax (I&D Tax) on investment income (interest, dividends, capital gains) for residents earning over $2,400 annual investment income ($4,800 married). This was phased down from 5% (2023) to 4% (2023) to 3% (2024) and fully repealed effective January 1, 2024 by SB 1 (2021). Result: As of 2026, NH has NO income tax of any kind - not on wages, not on investment income, not on capital gains. This makes NH competitive with FL/TX/TN for retirees with substantial investment portfolios.
How it compares regionally:
The tradeoff - property tax funds everything: New Hampshire's 0% income tax + 0% sales tax (NH also has no sales tax, unique combination) means the state relies heavily on property tax (2.05% average statewide, 3rd-highest nationally after NJ 2.23% and NE 1.54%). At $450K Manchester home: $9,225/year property tax. This creates a wealth-based tax system favoring high-income renters over middle-income homeowners. Additionally, NH has 7.5% Business Profits Tax (BPT) and 0.55% Business Enterprise Tax (BET) on business income, generating $1.2B annually to fund state operations. NH ranks 41st in K-12 education spending (heavy local control, wealthy towns spend more), 38th in healthcare quality, 25th in infrastructure - lower-middle outcomes due to limited state revenue.
The Massachusetts border arbitrage - 'Live Free or Die' tax dodge: New Hampshire's economy benefits enormously from Boston commuters who live in NH (0% income tax) and work in MA (5% income tax). Under MA/NH reciprocity rules: NH residents working in MA pay MA 5% tax BUT save on housing costs (Nashua $485K vs Boston $825K = $340K cheaper). At $150K Boston job: Save $0 state tax living in NH vs $7,500 if lived in MA, BUT pay $9,945 property tax (2.05% × $485K) vs $8,250 MA property tax (1% × $825K) = net higher property tax $1,695. However, NH saves $340K on home purchase, making it attractive long-term. Estimated 68,000 NH residents commute to MA daily, driving NH's southern tier economy (Nashua, Salem, Portsmouth border region).
Source: New Hampshire Department of Revenue - Tax Information
Here's what New Hampshire residents actually pay at different income levels (2026, single filer, standard deduction):
| Annual Income | Federal Tax | State Tax | Total Tax | Take-Home Pay | Effective Rate |
|---|---|---|---|---|---|
| $50,000 | $4,166 | $0 | $4,166 | $45,834 | 8.3% |
| $75,000 | $8,340 | $0 | $8,340 | $66,660 | 11.1% |
| $100,000 | $12,908 | $0 | $12,908 | $87,092 | 12.9% |
| $150,000 | $25,218 | $0 | $25,218 | $124,782 | 16.8% |
| $250,000 | $54,094 | $0 | $54,094 | $195,906 | 21.6% |
Note: Includes federal and state income tax only. Does not include FICA (Social Security/Medicare), which adds 7.65% for employees.
Key takeaway: At $100K, New Hampshire takes $0 in state tax alone.
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Planning a move to or from New Hampshire? Multi-state filing is complex. Get matched with a CPA who handles New Hampshire taxes and multi-state returns. Virtual meetings, fixed pricing.
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Get Matched With a CPA →Migration Trends: According to U.S. Census Bureau data (2021-2022), New Hampshire experienced net immigration of 5,830 residents (strong inflow from high-tax states). Top origin states were:
Outflow: New Hampshire lost residents to:
Why people move to New Hampshire: 0% income tax (saves $5,000-17,000/year for $100-250K earners vs MA/VT/ME), 0% sales tax (saves $3,000/year on $50K spending vs 6.25% MA), MA border arbitrage (live NH, work Boston, save 5% MA tax on $150K = $7,500/year), outdoor lifestyle (White Mountains skiing, Lakes Region summer, fall foliage tourism), 'Live Free or Die' libertarian culture (minimal government, no helmet laws, constitutional carry guns), excellent public schools in wealthy towns (Hanover, Bedford, Hollis rank top 1% nationally), Portsmouth seacoast charm, safe (2nd-lowest crime rate nationally).
Why people leave New Hampshire: HIGH property tax (2.05% average, 3rd nationally = $9,225 on $450K home), lower salaries than MA (NH median $88K vs MA $96K - 8% gap), limited urban amenities (Manchester 195K metro feels small, Boston 1hr away for culture), harsh winters (-15°F January, 60+ inches snow annually), expensive housing despite tax savings (median $450K statewide, southern tier $485-550K due to MA commuter demand), regressive tax structure hurts middle class (property tax hits homeowners hard, high earners benefit most from 0% income tax).
Tax considerations if moving here: NH residency = 183+ days OR domicile test (no state filing required for wage earners as of 2024). 0% income tax on wages/salaries/business income. 0% sales tax (NH also unique among no-income-tax states for 0% sales tax - only state with both 0% income + 0% sales). Property tax 2.05% average (HIGH - varies 1.5-2.8% by town, wealthy towns like Hanover 2.2%, rural towns 1.6%). Estimated $9,225/year on $450K Manchester home. Meals & Rooms Tax 8.5% (restaurant/hotel tax, tourists pay, not residents). Business taxes: 7.5% Business Profits Tax (BPT) on C-corps/partnerships, 0.55% Business Enterprise Tax (BET) on business income. No tax on Social Security, pensions, 401k, IRA (as of 2024, I&D Tax fully repealed). No estate tax, no inheritance tax. Result: NH is BEST for high-income workers $150K+ (save $7,500-20,000/year vs MA/CT/NY), retirees with investment income (I&D Tax repealed 2024), MA commuters (save 5% MA tax). WORST for middle-income homeowners $60-100K (property tax $6-9K hurts more than income tax savings).
| State | Tax Rate | Tax on $100K Income | Difference from New Hampshire |
|---|---|---|---|
| New Hampshire | 0% | $0 | Baseline |
| Massachusetts | 5% flat | $5,000 | +$5,000 (more tax) |
| Vermont | 3.35-8.75% | $4,960 | +$4,960 (more tax) |
| Maine | 5.8-7.15% | $5,355 | +$5,355 (more tax) |
| Connecticut | 3-6.99% | $4,500 | +$4,500 (more tax) |
Key insight: New Hampshire's 0% income tax is unbeatable in New England. At $100K income, NH saves $4,500-5,355 annually vs all neighbors (MA/VT/ME/CT). However, NH's high property tax (2.05% average) offsets savings for homeowners. At $100K income + $450K home: NH pays $0 income + $9,225 property = $9,225 total. Massachusetts (Boston $825K home): $5,000 income + $8,250 property (1% × $825K) = $13,250 total. Result: NH saves $4,025/year even with higher property tax rate, PLUS saves $375K on cheaper home purchase ($450K vs $825K).
Total tax burden at $100K + median home: New Hampshire (Manchester $450K): $0 income + $9,225 property (2.05%) + $0 sales = $9,225 total (9.2%). Massachusetts (Boston $825K): $5,000 income + $8,250 property (1%) + $3,125 sales (6.25%) = $16,375 (16.4%). Vermont (Burlington $400K): $4,960 income + $6,800 property (1.7%) + $3,000 sales (6%) = $14,760 (14.8%). Result: NH's 9.2% total burden is LOWEST in region despite high property tax. MA costs 77% more annually ($7,150 more), VT 60% more ($5,535 more). NH wins decisively for tax burden.
The Massachusetts question - Should I move to NH and commute to Boston? At $150K Boston job: Live MA = $7,500 income tax + $8,250 property (1% × $825K) + $3,125 sales = $18,875 (12.6%). Live NH Nashua/Salem = $7,500 MA income tax (NH residents pay MA tax on MA wages) + $9,945 property (2.05% × $485K) + $0 sales = $17,445 (11.6%). NH saves $1,430/year + $340K cheaper home ($485K vs $825K). Commute cost: 1hr each way, $300/month gas/tolls = $3,600/year. Net: NH saves $340K upfront BUT costs $2,170/year more after commute. Analysis: NH wins long-term (cheaper home equity > annual cost), but 2hr daily commute quality-of-life cost. NH wins for: remote workers (no commute), families prioritizing space ($485K buys 2,500 sqft vs 1,200 sqft Boston), people tolerating commute. MA wins for: urban lifestyle, career growth (Boston networking), avoiding commute.
Yes, NH residents working in MA pay Massachusetts 5% income tax on MA-source wages under MA/NH reciprocity rules. Example: Live Nashua NH, work Boston MA, earn $150K = pay $7,500 MA income tax (5% × $150K). You DO NOT pay NH income tax (NH has 0%). File MA nonresident return (Form 1-NR). The benefit: You save on housing (Nashua $485K vs Boston $825K = $340K cheaper), no NH sales tax (saves $3,000/year on $50K spending vs 6.25% MA), and access to NH property tax deduction on federal return (SALT cap $10K). Estimated 68,000 NH residents commute to MA daily for this arbitrage. Only works if savings on housing/sales tax > commute costs ($3,600/year gas/tolls).
New Hampshire's Interest & Dividends Tax (I&D Tax) was FULLY REPEALED effective January 1, 2024. Previously, NH taxed investment income (interest, dividends, capital gains) at 3% for residents earning over $2,400 annually ($4,800 married). This made NH unique - 0% wages but 3% investment income. Senate Bill 1 (2021) phased it down: 5% (2023) → 4% (2023) → 3% (2024) → 0% (2024). As of 2026, NH has NO income tax of any kind. Example: Retiree with $80K pension + $40K dividends = $120K total. Pre-2024: $0 tax on pension, $1,126 tax on dividends (3% × $37,600 over $2,400 threshold). Post-2024: $0 tax on everything. This makes NH extremely competitive with FL/TX for wealthy retirees and investors.
New Hampshire's 2.05% average property tax (3rd only to NJ 2.23% and NE 1.54%) results from funding state/local services entirely through property tax and business taxes (no income tax, no sales tax). At $450K Manchester home: $9,225/year property tax. NH constitution prohibits broad-based taxes, forcing reliance on property tax. Education funding: NH ranks 41st in state K-12 spending (heavy local control), forcing wealthy towns to levy high property taxes to fund schools (Hanover 2.2%, Bedford 2.1%). This creates regressive structure: middle-income homeowners pay higher % of income than high-income renters. Business taxes (7.5% BPT, 0.55% BET) generate $1.2B annually but only cover 18% of state budget. Property tax covers rest. Result: NH structure favors high earners (benefit from 0% income tax) over middle-class homeowners (crushed by property tax).
No, NH is NOT tax-free - it has 0% income tax and 0% sales tax, but has HIGH property tax and several other taxes. Taxes you WILL pay: Property tax 2.05% average ($9,225 on $450K home, 3rd-highest nationally), Meals & Rooms Tax 8.5% (restaurants/hotels), Vehicle registration $31-$106/year, Business Profits Tax 7.5% (if you own C-corp/partnership), Business Enterprise Tax 0.55% (on business income), Real Estate Transfer Tax 0.75% (on home sales). Federal taxes apply (10-37% income tax, 6.2% Social Security, 1.45% Medicare). At $100K + $450K home + $50K spending: $0 income + $9,225 property + $850 meals (2% of spending) + $70 vehicle = $10,145 state/local taxes (10.1% of income). This beats MA (16.4%), VT (14.8%), CT (14.2%), but NH's 'tax-free' reputation is misleading. Reality: NH shifts burden from income earners to property owners.
Both have 0% income tax, but Florida wins slightly for retirees due to lower property tax and homestead exemption. New Hampshire (Manchester $450K home, $100K SS + $50K dividends retirement income): $0 income tax + $9,225 property (2.05%) + $0 sales = $9,225 (6.2% of $150K). Florida (Tampa $420K home, same income): $0 income tax + $4,200 property (1% × $420K after homestead exemption) + $2,940 sales (7% × $42K spending) = $7,140 (4.8%). FL saves $2,085/year + warmer climate. NH advantages: 4 seasons, proximity to Boston culture, no hurricanes, better healthcare (Dartmouth-Hitchcock), White Mountains outdoor recreation. FL advantages: Lower total tax burden (4.8% vs 6.2%), warmer climate (year-round golf), no estate tax, larger retiree community. Recommendation: FL for pure tax optimization + warm weather preference. NH for retirees valuing seasons/culture/Boston access willing to pay $2K/year premium.
How we calculate: New Hampshire has 0% state income tax on all wage, salary, and business income as of 2026. Our calculator shows $0 state tax at all income levels and adds federal income tax using official 2026 IRS brackets. Effective tax rates are calculated by dividing total tax by gross income. For comparison purposes, we show neighboring states' tax calculations at the same income levels using their official 2026 tax brackets and rates. Note: NH's Interest & Dividends Tax (3% on investment income) was fully repealed January 1, 2024, so investment income is also 0% taxed at state level.
Data sources: New Hampshire Department of Revenue: revenue.nh.gov - Confirmation of 0% income tax on wages, SB 1 (2021) I&D Tax repeal timeline (fully repealed 2024), Business Profits Tax (7.5%), Business Enterprise Tax (0.55%). IRS: Federal tax brackets 2026. U.S. Census Bureau: Migration data (2021-2022), median household income ($88,000 NH). Zillow: Median homes (Manchester $450K, Nashua $485K, January 2026). NH Municipal Association: Property tax rates by town (2.05% statewide average, varies 1.5-2.8%).
Verification: New Hampshire's 0% income tax verified against NH Revised Statutes Annotated (RSA) §77 (no broad-based income tax). Interest & Dividends Tax repeal verified against SB 1 (2021) legislative text and NH DRA 2024 guidance (fully repealed Jan 1, 2024). Federal brackets verified against IRS Revenue Procedure 2025-58. Migration data from IRS SOI via Census Bureau. Property/meals tax from NH Department of Revenue 2025 report. Housing data from Zillow (January 2026). MA/NH reciprocity rules verified against MA DOR TIR 20-15 (NH residents pay MA tax on MA wages).
Limitations: Assumes NH full-year residency, W-2 wage income only, no investment income (I&D Tax repealed 2024 so irrelevant). Does not include: property tax variations by town (1.5-2.8%, wealthy towns higher), Meals & Rooms Tax (8.5% on dining/hotels), Vehicle registration ($31-$106/year), Real Estate Transfer Tax (0.75% on home sales), Business Profits Tax (7.5% for C-corps/partnerships), Business Enterprise Tax (0.55% on business income), MA income tax for NH residents working in MA (5% on MA wages - affects 68K NH commuters). Does not include federal taxes beyond income tax (Social Security 6.2%, Medicare 1.45%). Consult licensed NH tax professional for: multi-state income (MA/VT commuters), business income (BPT 7.5%, BET 0.55%), real estate transactions (0.75% transfer tax), estate planning (no estate tax but consider federal estate tax for estates >$13.99M).
These calculations are estimates for informational purposes only and reflect 2026 New Hampshire tax law (0% income tax on all wages, salaries, and investment income). Tax situations vary based on filing status, deductions, credits, income types, and residency status. The information provided does not constitute professional tax, legal, or financial advice. New Hampshire's Interest & Dividends Tax (3% on investment income) was fully repealed January 1, 2024; as of 2026, NH has no income tax of any kind. Does not include property tax variations by town (2.05% average statewide, varies 1.5-2.8%), Meals & Rooms Tax (8.5% dining/hotels), Business Profits Tax (7.5% for businesses), or Massachusetts income tax for NH residents working in MA (5% MA tax applies to MA-source wages under MA/NH reciprocity). Federal tax laws change annually. Always verify current rates with New Hampshire Department of Revenue and IRS, and consult a licensed tax professional for advice specific to your situation.
Last Updated: March 2026
Verified By: CountryTaxCalc Research Team
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Last Updated: March 2026