New Hampshire Repeals Interest and Dividends Tax; Personal Income Tax Gone

(NEW HAMPSHIRE) New Hampshire is entering 2025 with a tax change that many new arrivals will notice fast: the state has fully ended the Interest & dividends tax as of January 1, 2025. That repeal means New Hampshire now has no state tax on any personal income—not wages, not salaries, not interest, and not dividends—while still depending heavily on property taxes and, more and more, state fees to pay for services.

For immigrants and other newcomers, this is good news with a catch. Your state income-tax paperwork gets simpler, but the costs you feel day-to-day may show up elsewhere: a high annual property-tax bill if you buy a home, and higher fees—especially for vehicles—starting in 2026. This guide walks through the full “arrival-to-settling-in” process, with timeframes, what you need to do, and what to expect from government offices as you build your life in New Hampshire.

First week in New Hampshire: set your paper trail the right way

Most immigration steps still run through the federal government, not the state. But state residency choices can affect your budget and your records, so it helps to set up clean documentation right away.

• Update your immigration address (same day you move, or within days). Many noncitizens in the United States must report a new address to USCIS. You can file Form AR-11 online or by mail using the official USCIS page for Form AR-11, Alien’s Change of Address Card. Keep proof of submission with your immigration papers.

• Start a “New Hampshire folder.” Put these items together early:

  • Lease or deed (proof you live in New Hampshire)
  • Utility bill, if you have one
  • Any town or city letters (tax, valuation, school enrollment)
  • Vehicle registration and insurance documents
  • Copies of federal tax filings and W-2/1099 forms

Because the Interest & dividends tax is gone starting January 1, 2025, you won’t be building a file for a New Hampshire personal income-tax return going forward. But you still need records for federal taxes and for local property-tax planning.

Weeks 2–6: learn the tax reality—no income tax, but property tax can bite

New Hampshire’s big headline is simple: no state tax on personal income as of January 1, 2025. Before that, through tax year 2024, the state had a 3% flat tax on interest and dividends while wages and salaries were not taxed. Now, the repeal means you generally won’t file a state return for New Hampshire-source personal income in 2025 and beyond.

The trade-off is that property taxes remain among the highest in the country. The source material reports a median effective property tax rate around 1.61% and a median annual property-tax bill of about $6,372. For many immigrant families, that number matters more than any income tax rate because it can change your monthly budget in a way that feels like “hidden rent,” especially after you buy.

A practical way to think about it: property tax is set locally and varies by town, so two homes with the same purchase price can carry very different yearly bills.

Months 2–3: choose your town like you choose your job—compare tax rates, not just rent

Newcomers often focus on the home price or the monthly rent. In New Hampshire, you should also compare the local tax rate, which is typically listed as dollars per $1,000 of assessed value.

Examples from 2025 local rates in the source material show wide variation:

• Rochester: $15.30 per $1,000, up from $14.85 in 2024; a median single-family home ($377,000) faces an increase of about $169.65 for 2025.
• Salem: $18.16 per $1,000, up from $17.60 in 2024.
• Lebanon: $21.53 per $1,000 of assessed value.
• Manchester: $19.58 per $1,000, up from $18.86 in 2024.
• Portsmouth: $11.51 per $1,000, slightly below the FY26 budget estimate due to stronger property-value growth.

The Seacoast examples show even more spread, from New Castle at $5.39 to Brentwood $25.17 per $1,000 of assessed value.

If you plan to stay long term, don’t just ask “Is New Hampshire tax-free?” Ask “Which town’s property tax fits my family’s future?” That question matters for immigrants who may be building savings for a green card filing, citizenship fees, or family reunification travel.

Month 3 onward: plan around school funding shifts that can shape housing choices

Property taxes in New Hampshire also tie closely to schools. The source material points to a June 2025 New Hampshire Supreme Court ruling that changed how State Education Property Tax revenue is handled, allowing property-wealthy towns to retain “excess” revenue instead of redistributing it.

It reports effective state education tax rates ranging roughly from $0.44 per $1,000 in some towns to $1.56 per $1,000 in others. For immigrant parents, this can show up as a hard choice: a town with strong schools may also carry a higher housing cost, while another town may have a different mix of services and taxes.

When you visit a town hall or talk with neighbors, ask simple questions:
– Were properties revalued recently?
– Did the tax rate jump because of the school budget?
– Are there big changes expected next year?

Retirement and long-term stability: exemptions that can matter for immigrant seniors

New Hampshire’s lack of a state income tax—including no state tax on retirement distributions, interest, or dividends after January 1, 2025—can appeal to immigrant retirees. But the property-tax load can still feel heavy, so exemptions matter.

Key changes and details from the source material:
– Asset thresholds increased from $35,000 to $50,000.
– Minimum exemption amounts rose from $5,000 to $7,500, with annual inflation adjustments.
– Local rules vary, and some towns use age tiers and income and asset tests.
– Some towns allow exemptions of well over $300,000 of assessed value for residents 80+ with limited income and assets.

There is also a proposed change to the homestead exemption:
– Current protection: up to $120,000 in equity.
– Proposed: $350,000 for a single person and $500,000 for all persons with an interest in the property, if it has been the primary residence for the previous 12 months.

For immigrant families who plan to age in place, these rules can shape whether buying a home feels safe or risky.

2026 cost checkpoint: expect higher fees, especially for vehicles

New Hampshire is leaning more on fees as it reduces or removes other revenue sources. The source material says lawmakers and agencies increased or created new fees and fines in about 125 instances, and about 58 new or higher fees take effect January 1, 2026.

The largest group of hikes comes from the Department of Safety, focused on motor-vehicle and trailer registrations, decals, licenses, and license plates. Those motor-vehicle-related increases alone are projected to add about $31.5 million to the Highway Fund over the next year and a half.

For new immigrants, this can land at an inconvenient time: right after you buy a used car for work, or when you upgrade to a larger vehicle for a growing family. Build this into your first full-year budget, even if the state still feels “tax-free” on paper.

Entrepreneurs and foreign-owned businesses: watch business taxes and local property costs

New Hampshire relies heavily on business taxes, mainly the Business Profits Tax (BPT) and the Business Enterprise Tax (BET). The source material notes lawmakers are considering further cuts, including a proposed reduction to the BET from 0.55% to 0.50% for tax periods ending on or after December 31, 2026 in HB 155, with an effective date of July 1, 2025 if enacted.

For immigrant entrepreneurs, the picture is mixed:
– The state may reduce business tax rates.
– It may also raise fees and keep pressure on property taxes.
– A small shop, trucking company, or home-based business can feel those changes through registrations, permits, and equipment costs.

VisaVerge.com reports that for many newcomers, the real “tax story” in New Hampshire is not a paycheck tax—it’s the combined cost of housing, vehicles, and local services.

Clearing old problems: the 2025–2026 tax amnesty window

The New Hampshire Department of Revenue Administration is offering a one-time tax amnesty from December 1, 2025, through February 15, 2026. Taxpayers can apply for amnesty from all penalties and one-half of accrued interest on eligible state-tax liabilities if they pay the principal tax due.

This matters if you:
– Previously lived in New Hampshire and have unpaid state liabilities.
– Ran a small business or had a rental property and later found unpaid obligations.
– Need a clean record to apply for a professional license or expand a business.

A realistic “arrival timeline” for 2025 movers

If you’re moving to New Hampshire in 2025, here’s a simple plan you can follow:

1. Days 1–7
   • File Form AR-11 if required; collect proof of address and keep copies.
2. Weeks 2–6
   • Price out housing with property taxes included; don’t assume a lower paycheck tax means a lower total cost.
3. Months 2–3
   • Compare towns by tax rate per $1,000 and by school budgeting trends; ask about revaluations.
4. Month 3 onward
   • If you’re buying, ask your town about elderly exemptions or other relief rules if your household includes seniors.
5. Before January 1, 2026
   • If you rely on a vehicle for work, plan for higher registration-related costs.
6. December 1, 2025–February 15, 2026
   • If you have old state liabilities, consider the amnesty period to clear penalties and reduce interest.

Key takeaway: Ending the Interest & dividends tax on January 1, 2025 does simplify life for many immigrant households. But New Hampshire still collects revenue through other channels. The real winners will be those who plan for property taxes, account for town-by-town differences, and budget for the fee increases already on the calendar.