This article will explore the tax system of New Hampshire (especially the tax regulations related to cryptocurrency) and the recent regulatory dynamics concerning cryptocurrency.

Author: FinTax

1. Introduction

New Hampshire is known for its natural beauty, particularly the White Mountains, lakes, and autumn foliage. The state has always been a pioneer of innovation and development. As a state that played a significant role in the American Revolutionary War and led the independence process, New Hampshire is widely recognized for its state motto, "Live free or die." Centuries later, the state is once again taking a leading role, this time in promoting the broader acceptance of cryptocurrency across the United States: in May 2025, New Hampshire became the first state in the nation to legislate the establishment of a Bitcoin reserve.

Before this significant development, the state had already earned widespread acclaim from the cryptocurrency industry for its friendly tax policies. In light of this, this article will delve into New Hampshire's tax system (especially the tax regulations related to cryptocurrency) and the recent regulatory dynamics concerning cryptocurrency.

2. Overview of New Hampshire's Tax System

2.1 Overview

New Hampshire has a relatively friendly tax system, making it an attractive residence for individuals seeking low tax burdens in the United States. The state's tax system is particularly favorable for high-income earners, business owners, and wage earners. As one of the few states in the U.S. that does not impose personal income tax, sales tax, or capital gains tax, New Hampshire is highly appealing to taxpayers. In fact, the state's tax burden has been shifted to other types of taxes (especially property tax), which can impose a heavy burden on landlords and tenants. However, overall, New Hampshire's tax system is advantageous in the U.S., characterized by simplicity, economic freedom, and high transparency.

The New Hampshire Department of Revenue Administration (DRA) is responsible for the collection and management of various taxes and enforces compliance through audits and investigations to ensure taxpayers fulfill their tax obligations. Additionally, the DRA oversees the collection and management of municipal taxes to ensure fairness and compliance with state laws.

2.2 Major Taxes

2.2.1 Business Enterprise Tax (BET)

The Business Enterprise Tax is one of the main taxes in New Hampshire, levied based on the value of business entities that includes compensation (such as wages or salaries), interest, and dividends paid, with a tax rate of 0.55%. It is a distinctive component of the state's tax structure. In simple terms, the Business Enterprise Tax is measured by the scale of business operations, which differs from another major tax in New Hampshire, the Business Profits Tax (BPT), which is based on net profits of the business. The Business Enterprise Tax was established in 1993 to ensure that all businesses operating and generating income in the state contribute to public finances.

The tax applies to business entities such as corporations, limited liability companies, partnerships, and sole proprietorships with total revenue exceeding $277,000 or a business value tax base exceeding $111,000. Furthermore, this tax must be paid regardless of whether the business is profitable or has minimal profits.

2.2.2 Business Profits Tax (BPT)

The Business Profits Tax is also a significant source of revenue for the New Hampshire government and one of its main taxes, equivalent to a state-level corporate income tax that taxes the net profits of businesses earning income in the state.

This tax applies to entities such as corporations, limited liability companies (LLCs), partnerships, and sole proprietorships, and in some cases, it also includes trusts and estates. The tax applies to entities operating in New Hampshire with annual gross revenue exceeding $92,000.

Currently, the BPT tax rate is 7.5% of taxable net profits. This rate has decreased from the previous 8.5%, reflecting the state's ongoing tax reform efforts. Compared to other states, New Hampshire's Business Profits Tax rate is relatively low and employs a simplified calculation method closely linked to federal tax filings.

Overall, the Business Profits Tax provides New Hampshire with a channel for revenue generation through corporate taxation while maintaining a business-friendly tax environment. With this tax arrangement, taxable entities such as businesses can contribute to public finances while avoiding other tax burdens like personal income tax and sales tax.

2.2.3 Property Tax

Another major tax that residents of New Hampshire pay and a primary source of revenue is the property tax. The state compensates for the lack of personal income tax and sales tax with high property taxes, resulting in one of the highest per capita property tax burdens in the nation. New Hampshire imposes an effective tax rate of 1.41% on owner-occupied properties, generating approximately $360 million in revenue for 2024, a 38.3% increase from the previous fiscal year.

Property taxes in New Hampshire are administered by local governments, with tax collection and management executed at the municipal and town levels. Consequently, each town manages its taxes based on its budgetary needs, meaning tax rates may vary by locality.

Although the tax is collected at the town level, the New Hampshire Department of Revenue Administration conducts assessments to ensure tax rates are fair and uniform across towns, considering factors such as municipal budgets, local education budgets, and voter decisions.

Property taxes apply to various real estate, including residential, commercial, and industrial properties and their buildings. It also applies to "current-use land," but open space and agricultural land may receive certain tax reductions.

2.3 New Hampshire's Cryptocurrency Tax System

Currently, New Hampshire has not established any specific tax framework for cryptocurrency transactions or other related activities. However, cryptocurrency businesses or other economic entities operating in the state may still be subject to the aforementioned taxes, such as the Business Profits Tax (BPT), Business Enterprise Tax (BET), and property tax. The absence of a dedicated cryptocurrency tax may be related to the state's lack of personal income tax and sales tax, or it may be a deliberate positioning of the state as a friendly jurisdiction for cryptocurrency businesses.

This tax system facilitates the business operations and tax burden assessments for cryptocurrency enterprises. Additionally, the existing tax framework makes New Hampshire an ideal region for cryptocurrency businesses to develop products and generate a larger proportion of revenue. In other states, such income might incur more tax burdens.

From a broader perspective, the absence of personal income tax or capital gains tax means that residents can retain most of the income earned through cryptocurrency trading or other forms. Moreover, New Hampshire's overall low tax burden environment allows cryptocurrency businesses to fully leverage the existing system to expand operations while minimizing their tax liabilities. The state may also pursue more liberal tax reforms in the future to alleviate existing tax burdens and introduce incentives to further encourage the development of the cryptocurrency industry within its borders.

3. Future Trends in Cryptocurrency Regulation in New Hampshire

Since 2024, New Hampshire has taken several legislative actions aimed at providing a legal framework for blockchain or cryptocurrency-related activities and positioning the state at the forefront of cryptocurrency application and development. Last year, the state introduced the Decentralized Autonomous Organization Act to regulate decentralized autonomous organizations operating in the state. This legislation aims to provide guidance on governance, restructuring, and other matters, granting legal recognition to blockchain organizations and encouraging them to establish, expand, or relocate their businesses in New Hampshire.

In May 2025, New Hampshire Governor Kelly Ayotte officially announced the establishment of a "Strategic Bitcoin and Digital Asset Reserve Fund," allowing the state treasury to invest up to 5% of public funds in digital assets with a market capitalization exceeding $500 billion (currently only Bitcoin meets this standard), while New Hampshire's biennial budget totals $151.7 billion, making 5% equivalent to $7.85 billion. Prior to this, the Trump administration had just introduced policies to establish reserves for Bitcoin and other digital assets. The signing of this bill in New Hampshire marks the first time a local government in the U.S. has legally recognized Bitcoin as a reserve asset, providing a template for legislative practices in other states. However, the bill does not mandate investment; it merely grants the state treasury the authority to invest.

In addition to the recently passed bill, another House Bill (No. 639) proposed in 2025 is currently under review. It aims to provide more protections for cryptocurrency miners, and if passed, it would reduce state and local government oversight of cryptocurrency mining activities, granting greater freedom to practitioners in this field. Furthermore, the bill may protect mining companies from being prohibited by local governments on grounds of noise, energy consumption, or other reasons. The potential impact of this bill is significant, as it addresses some key challenges currently faced by cryptocurrency miners in the U.S., including noise and energy use issues associated with mining facilities. The bill would also negate the power of local governments to prevent people from using cryptocurrency to purchase goods and services. However, the bill is still pending approval in the House, and the state Senate has decided to pause the legislative process to allow for more debate time. Meanwhile, the Senate is also reviewing certain provisions of the bill, particularly those proposing not to classify cryptocurrency as securities or investment contracts. This regulatory initiative aims to diversify the state's investment portfolio, reflecting the growing recognition of digital assets at the institutional level.

4. Conclusion

The progress of cryptocurrency regulation in New Hampshire and the broad acceptance of cryptocurrency activities reflect the positive expectations for the cryptocurrency market sparked by Trump's second term. Although it is currently difficult to fully assess the effectiveness of the new legislation in New Hampshire, it is certain that the state's supportive stance towards cryptocurrency is likely to strengthen further in the coming years.

From a broader perspective, New Hampshire may once again take on a leading role, encouraging other states in the U.S. to more actively embrace cryptocurrency. Its potential impact could lead to the emergence of more cryptocurrency-friendly jurisdictions in the U.S., creating an expanding whitelist of cryptocurrency-friendly locations that provide investors and developers with ideal places to establish and operate cryptocurrency businesses without regulatory suppression or restrictions.

For New Hampshire, investing in Bitcoin represents a way to diversify its reserves and generate substantial investment returns. At the same time, the state's supportive stance towards cryptocurrency, combined with its low tax burden environment, is expected to attract a large influx of cryptocurrency enthusiasts and developers, seeking favorable conditions for developing innovative projects or achieving higher returns.

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