New Hampshire has no state estate tax and no state inheritance tax. Nothing is owed to the state, and no state death-tax return is filed, regardless of the size of the estate. Federal estate tax can still apply to very large estates, and residents who own property in Massachusetts, Vermont, or Maine may face those states’ estate taxes on assets located there.
No State Death Tax of Any Kind
New Hampshire collects nothing when a resident dies and assets pass to heirs. There is no estate tax on the deceased person’s total assets and no inheritance tax on what a beneficiary receives.1NH Department of Revenue Administration. Inheritance and Estate Tax A $50,000 estate and a $50 million estate are treated the same at the state level.
The state used to tax inherited wealth. The Legacy and Succession Tax under RSA 86 and the Transfer Tax on Nonresident Personal Property under RSA 89 were repealed effective January 1, 2003. For deaths on or after January 1, 2005, New Hampshire also stopped requiring its estate tax return (Form NH-706) after the federal government eliminated the state death tax credit that had funded it.2NH Department of Revenue Administration. Inheritance and Estate Taxes Today, no filing is owed to the state simply because someone passed away.
Federal Estate Tax Still Applies to Large Estates
The federal government taxes large estates even when a state does not. For deaths in 2026, the federal estate tax exemption is $15 million per person, set by the One, Big, Beautiful Bill Act (Public Law 119-21), signed July 4, 2025. The $15 million exemption is permanent and will be adjusted for inflation starting in 2027.3Internal Revenue Service. Whats New – Estate and Gift Tax
Only the portion of an estate above $15 million is taxed. Rates begin at 18 percent on the first $10,000 over the exemption and climb through graduated brackets to a top rate of 40 percent.4Internal Revenue Service. Instructions for Form 706 The gross estate covers everything the deceased owned or had an interest in at death: real estate, bank and investment accounts, retirement accounts, and life insurance proceeds payable to the estate or where the deceased held incidents of ownership.
Executors of estates that clear the filing threshold must submit IRS Form 706 within nine months of the date of death. Extensions are available through Form 4768, but any tax owed is still due by the original nine-month deadline.4Internal Revenue Service. Instructions for Form 706
Portability for Married Couples
A surviving spouse can claim the unused portion of the deceased partner’s $15 million exemption. The IRS calls this portability. If one spouse dies having used only $3 million of the exemption, the survivor can carry the remaining $12 million forward and add it to their own $15 million, sheltering up to $27 million from federal estate tax at the second death.5Internal Revenue Service. Estate Tax If neither spouse uses any exemption during life, a couple can pass up to $30 million free of federal estate tax.
Portability is not automatic. The executor must file Form 706 for the first spouse’s estate to claim it, even when the estate falls well below the filing threshold. Skip that filing and the unused exemption is lost for good. Couples who assume their estate is too small to worry about federal filings are the ones who most often lose this benefit.4Internal Revenue Service. Instructions for Form 706
Property in Neighboring States Can Be Taxed
New Hampshire’s rules stop at the state line. Massachusetts, Vermont, and Maine all impose state estate taxes with thresholds far below the federal amount. Massachusetts taxes estates over $2 million, Vermont over $5 million, and Maine over $6.8 million for 2026.
How those states measure an estate can catch families off guard. Massachusetts, for example, looks at the value of all real estate you own to decide whether your estate crosses its $2 million threshold, not just the property located in Massachusetts. If a New Hampshire resident owns a vacation home in Massachusetts and total real estate holdings push above that line, the estate can owe Massachusetts tax on the portion of assets located there. If you own property in another state, plan for that state’s rules alongside New Hampshire’s.
What Heirs Face Under Federal Rules
Stepped-Up Basis on Inherited Property
When you inherit property, whether a house, stocks, or other assets, the tax basis resets to the fair market value on the date of the deceased person’s death. This is the stepped-up basis.6Office of the Law Revision Counsel. 26 USC 1014 – Basis of Property Acquired From a Decedent The effect is real money. If your parent bought a home for $100,000 and it was worth $400,000 when they died, your basis for capital gains purposes is $400,000, not the original price. Sell for $420,000 and you owe capital gains tax on $20,000 instead of $320,000.
The rule applies to property received by inheritance, through a will, or from a revocable trust. It generally does not apply to gifts made during the owner’s lifetime, which carry over the original basis.
No Transfer Tax on Inherited Real Estate
New Hampshire charges a real estate transfer tax of $0.75 per $100 of the sale price on every real estate transaction, with the buyer and seller each paying that amount for a combined $1.50 per $100.7New Hampshire General Court. New Hampshire Revised Statutes Section 78-B:1 – Transfer Tax Transfers by will, by intestate succession, or by the death of a joint tenant are specifically exempt. When a home passes from an estate to an heir through probate, no transfer tax is owed.8New Hampshire General Court. New Hampshire Revised Statutes Section 78-B:2 – Exceptions
The exemption covers only the initial transfer from the estate to the beneficiary. If the heir later sells the property, the standard transfer tax applies to that sale. On a $350,000 home, the seller’s share would run $2,625. Keep the probate court decree with your records so the original exemption is properly documented.
Income Tax Filings Still Required After Death
No death tax does not mean no filings. Executors typically need to handle at least one income tax return, and sometimes more.
- A final individual return (Form 1040) covers income earned by the deceased from January 1 through the date of death. It is due by April 15 of the following year, with an automatic six-month extension available through Form 4868.9Internal Revenue Service. When to File
- If the estate itself earns $600 or more in gross income during any tax year while it stays open, the executor files a federal fiduciary income tax return (Form 1041) for interest, dividends, rental income, or capital gains generated by estate assets after the date of death.10Internal Revenue Service. 2025 Instructions for Form 1041 and Schedules A, B, G, J, and K-1
One New Hampshire wrinkle worth knowing: the state’s Interest and Dividends Tax under RSA 77 was fully repealed effective January 1, 2025. For deaths in 2025 or later, estates owe no state-level tax on interest or dividend income.11NH Department of Revenue Administration. TIR 2025-001 Interest and Dividends Tax Repealed Effective January 1, 2025 Before the repeal, estates earning more than $2,400 in interest or dividends had to file a state return and pay a tax of up to 5 percent. That obligation is gone.