NH Interest and Dividends Tax 2025: The Repeal and What It Means for Estates

New Hampshire's Interest and Dividends (I&D) Tax was permanently repealed effective January 1, 2025. For anyone settling a New Hampshire estate where the decedent died in 2025 or later, this means one fewer tax obligation to worry about. For estates where the decedent died in 2024, the final I&D Tax return (Form DP-10) may still be required — and the repeal does not erase that obligation.

Here is exactly what changed, what still applies, and how to determine whether your estate needs to file anything with the New Hampshire Department of Revenue Administration.

What the Interest and Dividends Tax Was

The I&D Tax was New Hampshire's primary mechanism for taxing unearned investment income at the state level. New Hampshire has no general income tax on wages, salaries, or capital gains. But for decades, the state taxed:

• Interest income from bonds, notes, and savings accounts (above the personal exemption)
• Dividends from corporate stock
• Distributions from certain LLCs and other pass-through entities that were treated as dividends

The historical rate was 5% on I&D income above a personal exemption of $2,400 per year (or $4,800 for joint filers, with additional exemptions for those over 65 or blind).

This was a tax that affected retirees disproportionately — particularly those living off bond interest, dividend income, or investment distributions. New Hampshire residents with substantial unearned income were paying meaningful state tax while their neighbors with only earned income paid nothing.

The Phase-Out: 2021 to 2025

The legislature voted to phase out the I&D Tax over multiple years:

The full repeal became effective for taxable periods ending after December 31, 2024. As of January 1, 2025, no I&D Tax is owed by any New Hampshire resident or estate regardless of how much unearned income they received.

What the Repeal Means for Estate Administrators

Estates where the decedent died on or after January 1, 2025

If the person died in 2025 or later, you do not need to file a New Hampshire I&D Tax return. There is no Form DP-10 obligation for these estates. New Hampshire has no personal income tax and no I&D tax — the state tax filing burden for an executor is limited to any applicable real estate transfer matters and property tax obligations.

Estates where the decedent died in 2024

The 2025 repeal is not retroactive. If the decedent died during calendar year 2024, the estate must still file the 2024 Interest and Dividends Tax Return (Form DP-10) if the decedent's unearned income during 2024 exceeded the personal exemption:

• $2,400 for a single filer
• $4,800 for a joint return (married filing jointly)
• Additional exemptions of $1,200 per person applied if the filer was 65 or older, or blind

The 2024 DP-10 was due by April 15, 2025. If the estate is still open and this return was not filed, the DRA may assess penalties and interest. The statute of limitations for the DRA to audit a filed return is generally three years from the filing date; for an unfiled return, the period can be longer.

If you are settling a 2024 estate and are uncertain whether the decedent's investment income exceeded the exemption, gather their 1099-INT, 1099-DIV, and K-1 forms from financial institutions. If total I&D income was below $2,400, no return is needed. If it exceeded the exemption, the DP-10 should be filed (or, if the April 2025 deadline has passed, filed as soon as possible with any applicable penalties).

Estates where the decedent died in 2023 or earlier

These estates should already have had their I&D Tax returns filed before the estate was closed. If you are re-opening an older estate or have discovered an unfiled return, consult a CPA about the current audit risk and penalty situation. The DRA's standard three-year audit window means 2022 returns filed on time generally fall outside the window in 2026.

Why the Repeal Matters for NH Estate Planning

The I&D Tax repeal represents the completion of a multi-decade effort to eliminate New Hampshire's death and investment taxes:

• 2003: Legacy and Succession Tax (inheritance tax) repealed for all deaths
• 2005: NH Estate Tax deactivated
• 2025: I&D Tax fully repealed

A New Hampshire resident who dies in 2025 or later leaves an estate with zero state-level death or investment tax obligations. The estate may still owe federal income tax on estate income (Form 1041), and large estates may face federal estate tax — but the state of New Hampshire imposes nothing.

This favorable tax climate is one reason New Hampshire has become a popular state for retirees. The absence of income tax on wages, combined with the now-eliminated I&D Tax, means investment income from a retirement portfolio is entirely untaxed at the state level.

The I&D Tax and Active Estates: One More Consideration

If an estate earns unearned income between the date of death and final distribution, that income is typically reported on the estate's federal income tax return (Form 1041). For tax years ending after December 31, 2024, this income is no longer subject to New Hampshire I&D Tax — even if the estate itself is still earning dividends or interest while the probate process winds down.

This removes a complication that previously affected estates with long administration periods. An estate taking twelve months to close in 2025 or 2026 can earn dividends in its estate account without triggering any state-level I&D filing obligation.

Summary: Do You Need to File DP-10?

The repeal of the Interest and Dividends Tax is unambiguously good news for New Hampshire estates. For the vast majority of estates where the decedent died in 2025 or later, it is one less form, one less deadline, and one less payment to the state.

For a complete overview of New Hampshire estate settlement — including the probate process, Medicaid recovery rules, and how to close an estate using the Waiver of Administration — see our full resource at /us/new-hampshire/estate-settlement/.

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