New Hampshire capital gains tax (2026): selling a business, real estate or farm
The individual side: no tax on gains, and now no tax on interest either
New Hampshire never taxed wages or capital gains. Its only personal income tax, the Interest and Dividends Tax under RSA chapter 77, was phased down and the whole chapter was repealed effective January 1, 2025 (RSA 77, repealed by 2021, 91:99). For 2026, a resident who sells stock, a vacation home or an interest in a company owes New Hampshire nothing on the personal return. Interest on an installment note, which the old tax would have reached, is now untaxed by the state as well.
The engine reflects this: the New Hampshire seller in the example pays $584,975 in total, all of it federal, while the Massachusetts seller pays -$211,190 more because of Massachusetts tax and its surtax on income over $1 million. See states with no capital gains tax for the rest of the list.
Where the tax shows up: the Business Profits Tax on asset gains
The Business Profits Tax is an entity-level income tax at 7.5% for taxable periods ending on or after December 31, 2023 (RSA 77-A:2). It applies to any business organization carrying on business activity in New Hampshire, and the statute lists proprietorships alongside corporations, partnerships and LLCs (RSA 77-A:1, I). Gross business profits include asset sale gains:
- For a partnership or LLC taxed as one, ordinary income is increased by the net gain from the sale of partnership assets (RSA 77-A:1, III(c), current law).
- For a proprietorship, profit from a business, profession, rental or farming activity is adjusted by gains or losses from the sale of assets held or used in the business (RSA 77-A:1, III(d)).
- For a C corporation, taxable income as determined federally, so the corporation's gain on an asset sale is included.
That means a New Hampshire owner who sells a business in an asset sale can owe 7.5% of the gain at the entity level even though the personal return shows no state tax. As simple arithmetic, a $1 million gain at the 7.5% rate (2026) is $75,000. A landlord who owns rental buildings personally and exceeds the filing threshold is also a business organization for this purpose.
Deductions and filing rules that change the BPT on a sale
- Commissions on the sale of business assets. Proprietorships, partnerships and LLCs may deduct reasonable compensation for the owners' personal services, which may include up to 15% of the gross selling price as commissions on the sale of business assets (RSA 77-A:4, III(a), current law). On an asset sale this deduction can be large.
- Filing threshold. A business organization must file when gross business income exceeds $92,000, an amount adjusted every two years for inflation from 2023 (RSA 77-A:6, I). Gross business income includes gross proceeds from selling business assets, so a sale year can cross the threshold by itself.
- Selling an ownership interest. A business organization realizing a gain or loss on the sale or exchange of an interest in the business organization must file a return regardless of the threshold (RSA 77-A:6, I-a).
The companion Business Enterprise Tax is 0.55% of the enterprise value tax base for periods ending on or after December 31, 2022 (RSA 77-E:2); its base is compensation, interest and dividends paid rather than sale gain, and it is generally creditable against the BPT. Whether a stock sale or an asset sale fits better depends heavily on this entity tax.
Real estate transfer tax: both sides pay
New Hampshire imposes its real estate transfer tax at $0.75 per $100 of price, with a $20 minimum on transfers of $4,000 or less (RSA 78-B:1). The rate applies to the buyer and again to the seller (RSA 78-B:4, III), so the combined charge is $1.50 per $100. On a $3 million commercial building each side owes $22,500 under current law. The tax reaches transfers of interests in real estate, so selling an entity that holds New Hampshire land can trigger it.
Moving to New Hampshire, and the Massachusetts question
Many owners who move north from Massachusetts plan to sell after the move. New Hampshire residence ends state tax on gain from stock and other intangibles, but Massachusetts still taxes a nonresident on gain from Massachusetts real estate and on business income sourced there, so the location of the asset matters as much as the address. Read residency change before a sale before you plan the move, and the pass-through entity tax page for how entity-level state taxes interact with your federal return.
Federally, long-term gain is taxed at 0%, 15% or 20%, with 20% beginning at $613,700 of joint taxable income (Rev. Proc. 2025-32, 2026); the capital gains guide covers it and capital gains tax by state lists every state. For a model that includes the entity tax, get the Big Sale Tax Analysis.
What to know
The headline "no capital gains tax" is true for individuals and misleading for business owners. Gain realized inside a proprietorship, partnership, LLC or corporation can carry the 7.5% Business Profits Tax, and the commission deduction and stock-versus-asset choice decide how much. The transfer tax is charged to both parties, though contracts can shift it. The engine example does not include the BPT.
Worked example
A married owner who materially participates sells the assets of an S corporation for a $2.75 million gain ($2.5 million long-term plus $250,000 of recapture passed through to the return), with $200,000 of other income. The engine models personal income tax only; Business Profits Tax owed by the business itself is discussed below. The second run is the same sale by Massachusetts residents.
| Engine run | NH resident | Same sale, Massachusetts |
|---|---|---|
| Filing status | Married, joint | Married, joint |
| State | New Hampshire | Massachusetts |
| Other income (wages, pension, interest) | $200,000 | $200,000 |
| Long-term capital gain | $2,500,000 | $2,500,000 |
| Section 1245 recapture (ordinary income) | $250,000 | $250,000 |
| Federal income tax on the sale | $584,975 | $584,975 |
| Net investment income tax (3.8%) | $0 | $0 |
| State income tax on the sale | $0 | $211,190 |
| Total tax caused by the sale | $584,975 | $796,165 |
| Effective rate on the gain | 21.3% | 29.0% |
| Gain kept after these taxes | $2,165,025 | $1,953,835 |
Computed October 7, 2026 by the Big Sale Tax engine (engine.js yearTax): federal brackets, 0/15/20% thresholds and AMT from Rev. Proc. 2025-32 (OBBBA-adjusted) and the One Big Beautiful Bill Act (P.L. 119-21); NIIT under IRC 1411 (thresholds not indexed); state tax from the engine's state table. "Tax caused by the sale" = tax with the sale minus tax without it. Excludes selling costs, local taxes and estimated-tax timing. Education only.
Run your own numbers
2026 law from the engine: federal 0/15/20% brackets (Rev. Proc. 2025-32), 25% cap on unrecaptured 1250 gain, ordinary rates on 1245 recapture, 3.8% NIIT over $200,000 single / $250,000 joint (IRC 1411), AMT, and your state's rules. Tax shown is the tax caused by the sale. Excludes selling costs, local taxes and NIIT exceptions for active business owners. Education only.
Long-Term vs Short-Term Capital Gains (2026)
The one-year holding rule, the 2026 0/15/20% thresholds for every filing status, NIIT, recapture, the state layer and a worked $200,000 example: 11 months vs 13 months, and what spreading the gain can save.
Frequently asked questions
Does New Hampshire have a capital gains tax?
Does New Hampshire tax capital gains on real estate?
Does New Hampshire tax the sale of a business?
Does New Hampshire tax retirement income or interest?
Do I pay Massachusetts tax if I move to New Hampshire and then sell?
Sources
- RSA chapter 77, repealed (NH General Court)
- RSA 77-A:1 (BPT definitions)
- RSA 77-A:2 (BPT rate)
- RSA 77-A:4 (BPT deductions)
- RSA 77-A:6 (BPT returns and threshold)
- RSA 77-E:2 (Business Enterprise Tax rate)
- RSA 78-B:1 (transfer tax rate)
- RSA 78-B:4 (payment by buyer and seller)
Figures as of October 7, 2026; each rate and limit above names its source and year. Education only, not legal or tax advice.
Keep reading
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