New Hampshire Sole Proprietorship: How to Start, Register, and Handle Taxes (2026)
Starting a sole proprietorship in New Hampshire is the simplest way to begin working for yourself. In most cases, it is the “default” business setup. You start doing the work, you get paid, congrats: you are a sole proprietor.
But here’s the part that trips people up: a lot of folks start as a sole proprietor even when what they really want is the simplicity of sole prop taxes with the protection of an LLC. If you’re bouncing off to other sites because you think “sole proprietor” means “no LLC for me,” I want to stop that exit-click right here.
This guide covers:
how to register a sole proprietorship in NH (and when you actually need to)
business name certificates and business licenses
what “NH sole proprietorship tax” really means in practice
bookkeeping and software options
when it makes sense to become an LLC
What is a sole proprietorship in NH?
A sole proprietorship is a business owned by one person where there’s no separate legal entity (like an LLC or corporation). It is simple, flexible, and cheap to start.
Pros
fast to start
minimal paperwork
straightforward tax filing (usually Schedule C)
Cons
no legal separation between you and the business
(liability can follow you home like a stray cat)can look less “official” to banks, vendors, or larger clients
can be harder to scale cleanly
If you’re doing anything with meaningful risk (contracting work, advice, client property, employees, vehicles, higher revenue), you should at least evaluate an LLC.
Do you have to register a sole proprietorship in New Hampshire?
You usually do not “register a sole proprietorship” with the state in the way people imagine.
What you may need to do is one or more of these:
1) Register a trade name (DBA) if you use a business name
If you operate under a name that is not your personal legal name, you typically register that trade name. People call this a DBA (“doing business as”).
Example:
If you operate as “Ryan Smith,” you might not need a trade name.
If you operate as “Granite State Bookkeeping,” you probably do.
Trade name registration is commonly handled at the city or town level (often through the clerk’s office). Procedures vary by municipality, so check your town’s requirements.
2) Get licenses or permits depending on what you do
Some industries require licenses at the state or local level. Even if the state does not require a license, your town might.
3) Register for tax accounts if you have employees or specific taxes apply
If you hire employees, you will deal with payroll tax systems. Some industries have special state taxes (like meals and rooms). The right setup depends on the business.
Starting a sole proprietorship in NH (step-by-step)
Here’s the cleanest path that avoids 80% of the usual mess.
Step 1: Pick your business name
If you want to use a name other than your own legal name, decide it now. Keep it simple, readable, and easy to spell.
Step 2: Decide whether you need a trade name registration (DBA)
If you are using a business name, handle the trade name process with your town or city.
Step 3: Get an EIN (sometimes optional, sometimes not)
An EIN is a federal employer identification number from the Internal Revenue Service.
You generally need an EIN if you:
hire employees
open certain business bank accounts
want to avoid using your SSN on W-9s and vendor paperwork
choose certain retirement plans
Even when it’s not required, many sole proprietors get one anyway for privacy and professionalism.
Step 4: Handle licenses and permits
This depends on your work and location. If you are unsure, start with your town and industry regulator.
Step 5: Open a separate business bank account
Even if you stay a sole proprietor, separate accounts make bookkeeping and tax filing dramatically easier. It also makes your business look more legit.
Step 6: Choose a bookkeeping method and track the right things
At minimum, track:
income by month
expenses by category
mileage (if applicable)
equipment and large purchases
receipts for anything you would not want to defend under audit
NH sole proprietorship taxes: what you actually file
Most “sole proprietor tax” confusion comes from mixing up federal and state rules.
Federal taxes (what most people mean)
A typical sole proprietor files:
Schedule C (business income and expenses)
Self-employment tax (Social Security and Medicare on net profit)
Estimated tax payments (often quarterly) if you are not having taxes withheld elsewhere
If you are making money and no one is withholding taxes for you, estimates are the difference between “responsible adult” and “why is April so spicy.”
New Hampshire taxes (important nuance)
New Hampshire does not have a broad wage income tax. That does not mean “no taxes,” and it definitely does not mean “no filing requirements” in every situation.
Depending on the business and structure, you may run into:
business-level taxes that can apply to certain business activity
industry-specific taxes (example: meals and rooms)
payroll-related registrations if you have employees
The right answer depends on what you do, your revenue, and how you are structured. If you want the defensible, sleep-at-night version, treat this as a planning conversation, not a guess.
If you’re running a business with real revenue, the smart move is to confirm whether NH business tax filings apply to you and build it into your workflow early.
How to file taxes for a sole proprietorship (simple checklist)
Use this checklist to keep tax season clean:
Income
1099-NEC and 1099-K forms (if you receive them)
sales summaries (Stripe, Square, PayPal, Shopify, etc.)
bank deposits that tie to revenue
Expenses
software subscriptions
advertising and marketing
supplies and materials
professional fees
travel and mileage logs
home office info (square footage, utilities, rent or mortgage interest)
equipment and tools (especially anything over a few hundred dollars)
Common mistakes that cost money
mixing personal and business expenses
not tracking mileage and then trying to reconstruct it
forgetting about self-employment tax when setting aside cash
buying equipment and not handling it correctly on the return
missing estimated payments and getting hit with penalties
Sole proprietor vs LLC in NH (the part people wish someone told them sooner)
A single-member LLC is often taxed similarly to a sole proprietor for federal purposes (still usually Schedule C), but it can provide legal separation and credibility.
This is the exact point where people drift to other sites: they assume choosing “sole proprietor” means they are locked out of LLC land. You are not.
When staying a sole proprietor makes sense
low risk work
low revenue
you are testing an idea
you want zero admin overhead
When an LLC becomes the smarter move
you have meaningful liability risk
you are signing contracts
you are dealing with client property
you want cleaner separation and more professional presentation
you are growing and want the option of future tax elections
Also, an LLC can be a stepping stone to an S-corp election later in the right situations. Not always worth it, but worth evaluating.
Which accounting software is best for NH sole proprietors?
The “best” software is the one you will actually use weekly.
Here are sane options:
Very simple, very cheap: spreadsheet + separate bank account
Simple bookkeeping: Wave
Small business standard: QuickBooks (owned by Intuit)
If you prefer cleaner UI: Xero
What matters more than the brand:
consistent categorization
monthly reconciliation
receipts captured
a mileage tracking habit if you drive for work
Top online services that help NH sole proprietors
Bookmark these types of resources:
New Hampshire Secretary of State for business entity info if you decide to form an LLC
New Hampshire Department of Revenue Administration for business tax guidance
Internal Revenue Service for EIN and federal basics
your town or city clerk site for trade name registration and local licensing
FAQ: NH sole proprietorship questions people actually ask
How do I register a sole proprietorship in NH?
Most of the time, you do not register the “sole proprietorship” itself. You may register a trade name (DBA) locally if you operate under a business name, and you may need licenses depending on your work.
Where can I get a business name certificate in NH?
Usually through your local town or city clerk when you register a trade name. Requirements vary by municipality.
Where can I find a business license for a sole proprietorship in NH?
It depends on the industry and location. Start with your town and your industry regulator.
How can I file taxes for a sole proprietorship?
Most sole proprietors file Schedule C with their personal return and pay self-employment tax on net profit. Many also need quarterly estimated payments.
Can I be a sole proprietor and an LLC?
Not at the same time as the same legal structure. But you can form a single-member LLC and still often file taxes in a similar way federally. The big difference is legal protection and how you operate the business.
Where can I get a business name certificate for my NH sole proprietorship?
In NH, what most people mean by a “business name certificate” is a trade name (DBA) registration.
If you do business under any name other than your own legal name, you’re required to register the trade name with the New Hampshire Secretary of State.
The New Hampshire Secretary of State provides trade name forms and instructions, and the trade name registration form (TN-1) shows the filing fee and what info you need.
Practical tip: banks often ask for proof of the trade name registration when opening a business account.
Where can I find a business license for a sole proprietorship in New Hampshire?
There is no single universal “NH business license.” Licensing is based on:
your industry (some professions are regulated), and
your city/town (many permits are local)
Best starting points:
For local permits and municipal licenses, contact your city or town clerk.
For state tax-related licenses (example: Meals and Rooms), start with the New Hampshire Department of Revenue Administration licenses and permits guidance.
For a general “what do I need” checklist, the state business portal has a start-a-business checklist that includes licenses and permits.
Which accounting software is best for NH sole proprietors?
Pick based on complexity, not vibes:
Simple, low transaction volume: Wave
Most CPA-friendly and common for small businesses: QuickBooks (Intuit)
Clean interface, strong for service businesses: Xero
My rule: if you are not reconciling monthly, the “best” software is the one that makes you feel mildly guilty enough to reconcile monthly.
What are the top online services to help set up a sole proprietorship in NH?
These are the core “do it right without wandering the internet for 6 hours” links:
New Hampshire Secretary of State trade name (DBA) forms and fees
NH QuickStart for online business filings and registrations (more relevant if you form an LLC later, but good to know)
New Hampshire Department of Revenue Administration “Registering a New Business” and tax accounts info
Internal Revenue Service EIN application (free, fast, and lots of scam sites pretend otherwise)
Internal Revenue Service sole proprietor filing overview and required forms list
How can I file taxes for a sole proprietorship in New Hampshire?
At the federal level, sole proprietors typically file:
Form 1040 + Schedule C (business profit/loss)
Schedule SE (self-employment tax)
1040-ES (quarterly estimated tax, if needed)
Additional payroll forms if you have employees (941, W-2, etc.)
Workflow that keeps you out of trouble:
Track income and expenses monthly (do not wait until March, that’s how people get weird).
If no taxes are being withheld from other income, plan on quarterly estimates.
File the Schedule C with your personal return.
NH note: NH does not tax wage income broadly, but NH business-related filings can still apply in certain situations. If you want, I can turn this into a simple decision tree for your post.
How to register a new sole proprietorship in New Hampshire?
How do I register a sole proprietorship in New Hampshire?
These are basically the same question, so here’s the clean answer:
Decide your business name
Using your legal name only? You often skip the trade name step.
Using a business name? Register a trade name (DBA) with the New Hampshire Secretary of State.
Get an EIN if you need one (or want privacy)
Apply directly with the Internal Revenue Service. It’s free.
Handle licenses and permits
Start with your city/town clerk for local requirements.
Register for any state tax accounts that apply
The New Hampshire Department of Revenue Administration covers “registering a new business” and state tax registration guidance.
Optional but important: consider an LLC
A single-member LLC can often still be treated like a sole proprietorship for federal income tax purposes unless you have employment or excise tax filing requirements.
