Taxes on LLC in NH: Essential Guide for Single-Member LLCs in New Hampshire (2026 Update!)
What to Expect When You’re the Boss
If you’re running a business as a single-member LLC in New Hampshire, congrats—you’re wearing the crown and the accountant hat (for now). The good news? New Hampshire is a bit different when it comes to taxes. The bad news? It’s still the government, so there are still forms, rules, and gotchas.
Here’s what you need to know about how your LLC is taxed in New Hampshire—especially if you’re filing as a sole proprietorship, which is the default for single-member LLCs.
🚫 First, Let’s Clear This Up: No Sales Tax in NH
New Hampshire has no general sales tax. However, being based in NH does not automatically eliminate another state’s sales-tax obligations. Sales into other states need a separate review of the applicable rules.
Caveat: Certain specific services (like rooms and meals, car rentals, etc.) are taxed under separate NH laws, so if you’re in hospitality or rentals, let’s talk.
🧾 How Your LLC Is Taxed Federally: Like You
A domestic single-member LLC is generally disregarded for federal income tax purposes unless it elects corporate treatment. For an individual owner, its activity is reported on the appropriate schedule of Form 1040.
Operating business income is generally reported on Schedule C; rental or farming activity may belong on Schedule E or Schedule F.
Net earnings from a Schedule C business are generally subject to self-employment tax. Rental activity can have different treatment.
An LLC may elect corporate treatment. Depending on its election and eligibility, it may file a C corporation or S corporation return.
🧍♂️ Personal Compensation Deduction (NH-specific)
New Hampshire has its own unique rules when it comes to business taxes. One of the most misunderstood is the Personal Compensation Deduction.
Here’s how it works:
NH doesn’t tax income the same way the IRS does. Instead, it has two key business taxes (more on those below).
The Business Profits Tax allows eligible unincorporated businesses a deduction for fair and reasonable compensation for actual personal services performed by the proprietor, partner, or member.
The deduction is subject to NH rules and cannot reduce taxable business profits below zero.
The personal compensation deduction is not simply a deduction for owner withdrawals or an assumed salary. Review the services performed, reasonable compensation, and applicable documentation or recordkeeping safe-harbor rules.
📊 Taxes on LLC in NH: BET and BPT
New Hampshire’s two main business taxes are:
1. Business Profits Tax (BPT)
Filing threshold: for taxable periods beginning on or after January 1, 2025, gross business income from all activities over $109,000 generally requires a BPT return. A filing requirement does not mean tax is necessarily due.
Tax rate: 7.5% of taxable business profits, after applicable NH adjustments and deductions.
Taxable profits are determined from the applicable business income, with NH-specific adjustments and deductions.
2. Business Enterprise Tax (BET)
Filing threshold: for taxable periods beginning on or after January 1, 2025, gross receipts over $298,000 or an enterprise value tax base over $298,000 generally requires a BET return. These thresholds are adjusted biennially.
Tax rate: 0.55% of the taxable enterprise value tax base, after applicable adjustments and apportionment. The base includes:
Compensation paid or accrued, as defined under NH law
Interest paid or accrued
Dividends paid, as defined under NH law
A business may owe BET even without a profit. Owner compensation and distributions need careful classification under NH rules; not every owner withdrawal is automatically a taxable dividend. BET paid may be available as a credit against BPT.
🤝 Filing Logistics & Deadlines
BPT forms depend on tax classification: NH-1040 for a proprietorship or qualifying single-member LLC, NH-1065 for a partnership, and NH-1120 for a corporation. BET is reported on Form BET, with the applicable summary and supporting schedules.
Calendar-year proprietorship and corporate returns are generally due April 15; partnership returns are generally due March 15. Weekend and holiday adjustments may apply. Extensions extend filing time, not payment time.
Quarterly estimated payments generally apply when projected annual liability exceeds $200 for BPT or $260 for BET. Review each tax separately and any applicable exceptions.
🧮 Should You Stay a Sole Prop or Elect S Corp?
An S corporation election may help some owners, but there is no universal profit cutoff. Compare reasonable salary, expected federal and state taxes, payroll costs, preparation fees, and administrative requirements before deciding.
An S corporation brings payroll filings and additional compliance. We can assess the tax implications under a separately agreed planning scope; payroll setup and processing must be handled by you or your payroll provider.
🎯 Bottom Line
Running a single-member LLC in New Hampshire comes with some unique tax quirks:
No general NH sales tax, but other states’ rules may apply
Your profits flow through to your personal tax return
Eligible personal services may support a reasonable compensation deduction
You may owe BET even if you’re not profitable
Reviewed October 5, 2026. Sources: NH Department of Revenue Administration, Business Taxes and BPT/BET FAQs (revenue.nh.gov); NH RSA 77-A:4 and Rev 303.01; IRS, Single Member Limited Liability Companies (irs.gov). Filing thresholds, tax liability, and available deductions should be reviewed for your specific facts and tax period.
Need Help Untangling It All?
At Thrive-Tax, we specialize in simplifying taxes for New Hampshire solopreneurs and small business owners. We’ll help you stay compliant, minimize what you owe, and give you breathing room to actually run your business.
Need a BET/BPT projection or entity-election review? We confirm a separate planning scope and fixed quote before that work begins.
