New Hampshire Real Estate Transfer Tax: What Executors Need to Know

When a New Hampshire estate includes real property, executors face a tax most people never think about: the Real Estate Transfer Tax. It's not an estate tax, it's not an inheritance tax — both of which New Hampshire has eliminated — but it can still cost a family thousands of dollars if the executor doesn't know how to handle it correctly.

The Basic Rate

New Hampshire imposes the Real Estate Transfer Tax (RETT) under RSA 78-B on virtually every sale, grant, and transfer of real estate in the state. The standard rate is $0.75 per $100 (or fractional part) of the sale price or consideration, assessed separately on both the buyer and the seller. The effective combined rate is $1.50 per $100 of value — so a $400,000 property sale generates $6,000 in total RETT, split $3,000 each between buyer and seller.

For estate property sold to third-party buyers on the open market, this rate applies in full. There is no exception for inherited property being sold after the death of the original owner.

The Critical Exemption for Executor Deed Transfers

Here is where most executors make a costly mistake — or save thousands by knowing the law.

Under RSA 78-B:2, XI, the Real Estate Transfer Tax does not apply to transfers that occur:

• By devise (through a will)
• Through the laws regulating intestate succession and descent
• By the death of a co-tenant in real estate held by joint tenancy
• To or from a revocable trust
• Through a transfer-on-death deed

In plain terms: when an executor files a deed transferring property from the estate to a beneficiary named in the will — or to an heir under New Hampshire's intestate succession law — no RETT is owed. The transfer itself is tax-exempt.

To successfully claim this exemption, the deed must contain the notation: "Transfer Tax: EXEMPT, RSA 78-B:2, XI" on its face before it is recorded. If this notation is missing, the Registry of Deeds will presume the transfer is taxable. Getting a corrective deed re-recorded later is expensive and time-consuming.

Because all property transfers are legally presumed to be taxable by the registry office, the burden of claiming the exemption falls entirely on the executor. This is not automatic.

What Happens When the Heir Sells

The exemption covers only the initial transfer from the estate to the beneficiary. It does not follow the property into the future.

If an heir receives property exempt from RETT through an executor's deed and then sells it to a third party, that subsequent sale is fully subject to the $0.75 per $100 rate on both the seller (the heir) and the buyer. The heir/seller's portion of the RETT is calculated on the full sale price, not on any gain — it's a transfer tax, not an income tax.

This two-step reality trips up families constantly. The executor properly exempts the transfer to the heir. The heir then sells the house six months later and is surprised by a transfer tax bill. Both transactions are handled correctly; the tax is simply owed at the point of the arm's-length sale.

The step-up in basis — which adjusts the inherited property's tax basis to its fair market value at the date of death — helps substantially with federal capital gains on any appreciation. But the RETT is unrelated to gains. It's calculated on the total consideration, regardless of whether the heir profited.

Recording Fees and the LCHIP Surcharge

Beyond the RETT itself, executors recording deeds at any of New Hampshire's ten county Registries of Deeds face additional costs:

• Base recording fee: $12.00 for the first page, $4.00 per additional page
• Digital equipment surcharge: $2.00 per document (RSA 478:17-j)
• LCHIP fee: $25.00 flat surcharge on every deed, mortgage, discharge, and plan set (RSA 227-M)

The LCHIP fee funds the Land and Community Heritage Investment Program, which preserves the state's natural and historic resources. It generates over $4 million annually statewide. Executors must pay it via a separate check made payable to the specific county registry. The one exception: if the United States, the State of New Hampshire, a county, or a municipality is a party to the transaction, the LCHIP fee is waived under RSA 478:17-g, II(a). Executors facilitating transfers involving state agencies should cite this exemption on the deed's face.

Rockingham, Hillsborough, and Other County Registries

New Hampshire uses a decentralized registry system. Each of the state's ten counties maintains its own Registry of Deeds, and deeds must be recorded in the county where the property is physically located — not necessarily where the decedent lived.

• Rockingham County Registry of Deeds handles property in towns like Portsmouth, Salem, Exeter, and Hampton.
• Hillsborough County covers Manchester, Nashua, and surrounding municipalities.
• Merrimack County covers Concord and the Lakes Region.

If an estate includes property in multiple counties, the executor must record deeds separately at each relevant county registry. Each recording incurs its own fees and LCHIP surcharge.

Medicaid Liens and Clean Title

An executor cannot sell or transfer estate real property with clear title if a DHHS Medicaid estate recovery lien exists against it. New Hampshire's Department of Health and Human Services files liens with the county Registry of Deeds during the recipient's lifetime for cash assistance programs, and upon death for medical assistance if the decedent was over 55 and institutionalized.

Before executing any deed — even an exempt transfer to a beneficiary — executors should contact the DHHS Estate Recovery Unit (ERU) to determine whether any liens exist. Attempting to transfer property over an uncleared lien is ineffective and can create personal liability.

The Executor's Checklist for Real Estate Transfers

Before recording any deed in a New Hampshire estate:

1. Determine whether the transfer is exempt. Devise or intestate succession transfers are exempt under RSA 78-B:2, XI. Third-party sales are taxable.

2. Include the exemption notation on the deed if claiming exempt status: "Transfer Tax: EXEMPT, RSA 78-B:2, XI."

3. Contact the relevant County Registry of Deeds to confirm current recording fees and LCHIP requirements.

4. Clear DHHS Medicaid liens before recording. Obtain written clearance or a hardship waiver from the ERU.

5. Calculate probate court fees if applicable. If the estate is undergoing full administration, the court charges $305 for estates over $25,000 — plus a mandatory 3% electronic transaction surcharge when paying by credit or debit card through the TurboCourt or File & Serve platforms.

6. File the Inventory of Fiduciary (Form NHJB-2125-Pe) within 90 days of executor appointment. Real estate must be listed with its address, the county where the deed is recorded, and the specific book and page number of the deed.

How the Step-Up in Basis Interacts

When an heir inherits appreciated New Hampshire real estate, the federal "step-up in basis" adjusts the tax basis of the property to its fair market value on the date of the decedent's death. This is distinct from the RETT but equally important when the heir plans to sell.

Example: A property purchased decades ago for $120,000 is worth $600,000 at the date of death. The heir inherits with a $600,000 tax basis. If they sell immediately for $600,000, no federal capital gains tax applies — the entire gain from the decedent's era is erased. But they will still owe their share of the RETT on the $600,000 sale price: $4,500 (at $0.75 per $100).

New Hampshire imposes no state capital gains tax, which makes the combination of the step-up in basis and a post-inheritance sale highly efficient from an income tax perspective. The RETT is the one transaction tax that cannot be avoided on open-market sales.

Getting the Transfer Right

The RETT exemption for estate transfers is real and substantial, but it requires the executor to assert it correctly and proactively. Registries presume taxability. The $0.75 per $100 adds up fast on the property values typical in New Hampshire's real estate market — a $500,000 transfer to a beneficiary would generate a $3,750 tax bill if the exemption isn't claimed.

The New Hampshire Final Tax & Estate Tax Guide covers the full deed transfer process, RETT exemption language, LCHIP requirements, and Medicaid lien clearance procedures — alongside the complete probate timeline for New Hampshire estates in 2026.

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