New Hampshire does not tax pensions, and as of January 1, 2025 it does not tax any form of personal income at the state level.1NH Department of Revenue Administration. Repeal of NH Interest and Dividends Tax Now in Effect That means pension payments, Social Security benefits, 401(k) withdrawals, IRA distributions, and annuity income all pass through to you without any state deduction. You do not file a state income tax return on this money, and the state collects nothing from it.
Retirement Income That Is Not Taxed in New Hampshire
Because New Hampshire has no broad-based personal income tax, every common source of retirement money is free of state tax:2NH Department of Revenue Administration. Interest & Dividends Tax
- Social Security benefits
- 401(k) and 403(b) distributions, whether taken as lump sums or periodic withdrawals
- Traditional and Roth IRA withdrawals, at any amount
- Public pensions, including military retirement, and private-sector pensions
- Annuity payments
Federal taxes still apply to most of these distributions under normal IRS rules. New Hampshire simply adds nothing on top of that federal bill.
The Interest and Dividends Tax Is Gone
Until recently, New Hampshire did reach one slice of retiree income: interest from savings accounts, CDs, and bonds, and dividends from stocks or trusts. That levy, the Interest and Dividends Tax under RSA 77, was the state’s only tax on personal unearned income. House Bill 2, signed in 2023, repealed it effective January 1, 2025.1NH Department of Revenue Administration. Repeal of NH Interest and Dividends Tax Now in Effect
Starting in 2025, no filing is required and no state tax is owed on interest or dividend income of any amount. If investment income was the one piece of your retirement picture you were tracking for state purposes, you can stop.
No State Estate or Inheritance Tax
New Hampshire does not impose a state estate tax or inheritance tax. The Legacy and Succession Tax (RSA 86) and the Transfer Tax on personal property of nonresident decedents (RSA 89) were repealed for deaths on or after January 1, 2003, and the state estate tax return (NH-706) has not been required for deaths on or after January 1, 2005.3NH Department of Revenue Administration. Inheritance & Estate Taxes Assets you leave to heirs are not reduced by any state death tax. Federal estate tax rules still apply, but only to estates above the federal exemption, which sits well above $13 million per individual in 2025.
Where the Tax Bill Does Land: Property Taxes
The absence of income and sales taxes shifts the public funding load onto local property taxes, which are among the highest in the country. The state’s average effective property tax rate is roughly 1.41%. For most retirees, this is the single largest state and local tax bill they pay in New Hampshire. Rates vary significantly from town to town, so the municipality you choose within the state has a direct effect on what you owe each year.
Property Tax Relief for Older Homeowners
Two programs can reduce that property tax bill.
Elderly Property Tax Exemption
Under RSA 72:39-a and RSA 72:39-b, municipalities may adopt an exemption that reduces the assessed value of an eligible homeowner’s property. To qualify, you must be at least 65 on April 1 of the tax year, have lived in New Hampshire for at least three consecutive years, own and occupy the home as your primary residence, and fall within the income and asset limits your town has set.4New Hampshire General Court. New Hampshire Revised Statutes Section 72:39-a – Conditions for Elderly Exemption
State law sets floors that no municipality can go below: income of at least $13,400 for a single person or $20,400 for a married couple, and net assets of at least $35,000, excluding the home and up to two acres.4New Hampshire General Court. New Hampshire Revised Statutes Section 72:39-a – Conditions for Elderly Exemption Most towns set higher limits. The exemption dollar amounts also vary by town and typically step up at ages 65, 75, and 80. Your local assessor’s office can give you the figures that apply where you live.
Low and Moderate Income Homeowners Property Tax Relief
The state also runs a relief program open to homeowners of any age. A single filer qualifies with an adjusted gross income of $37,000 or less; a married filer or head of household qualifies at $47,000 or less.5NH Department of Revenue Administration. Low and Moderate Income Homeowners Property Tax Relief Applications are accepted only between May 1 and June 30 each year. Miss that window and you wait until next year.