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Julie Garber

Estate Taxes by State - Does New Hampshire Have an Estate Tax?

By December 12, 2009

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Does New Hampshire have an estate tax? The answer is no, currently New Hampshire does not collect a state estate tax, although things were different a few years ago before major changes took effect with regard to federal estate tax laws. Prior to January 1, 2005, New Hampshire, like many other states, collected a separate state estate tax, called a "pick up tax," that was actually equal to a portion of the overall federal estate tax bill. New Hampshire also does not collect a state inheritance tax as it was abolished effective January 1, 2003.

On January 1, 2005, the pick up tax was officially phased out under the provisions of the Economic Growth and Tax Relief Reconciliation Act ("EGTRRA"). In response to these changes in federal law, 18 states and the District of Columbia chose to enact laws that allow the assessment of a state estate tax. Just this year the New Hampshire legislature attempted to push through a state estate tax that would have taken effect on January 1, 2010, but in the end the New Hampshire legislature did nothing and as a result New Hampshire does not currently collect a state estate tax.

One thing to keep in mind is that the pick up tax, and therefore the New Hampshire estate tax, is scheduled to come back in 2011 due to the sunset of EGTRRA. But no one really believes that Congress and President Obama will allow this to happen. In fact, on December 3 the U.S. House of Representatives voted to repeal the repeal of the federal estate tax, lock in the current $3.5 million estate tax exemption and 45% tax rate for 2010 and beyond, and permanently repeal the pick up tax. The federal estate tax debate now moves to the U.S. Senate.

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