State playbook - New Hampshire

Matchbook, tuned for New Hampshire payroll, programs, and Granite State PFL.

New Hampshire has no wage income tax and - after the final repeal of the Interest and Dividends tax effective January 1, 2025 - no personal income tax on any form of income. The pre-tax savings stack compresses to federal plus FICA, the SUI wage base sits at $14,000, and Granite State Paid Family Leave is a unique voluntary employer-elected program that reshapes how Matchbook coordinates leave benefits.

What Matchbook ships for New Hampshire Tax profile
Map of the United States with New Hampshire highlighted
Tax mechanics

Payroll tax in New Hampshire

State income tax

No state income tax

New Hampshire has no tax on wages, and the 3% Interest and Dividends tax was fully repealed effective January 1, 2025 (HB 2, 2023 session). The employee pre-tax savings stack is federal marginal rate plus 7.65% FICA only - no state layer at all, including on investment income. A $3,300 healthcare FSA election saves about $1,050 for a 22% federal bracket NH employee. Matchbook calibrates under-election guardrails identically to other no-state-tax jurisdictions: savings-per-dollar is lower, so forfeiture hurts more per dollar of over-election.

New Hampshire Unemployment Insurance (Administrative Contribution plus UI tax)

Wage base $14,000 (2026)

Rate range: 0.10%-7.50% depending on merit rating; new employer rate 2.70%; plus a 0.2% Administrative Contribution on the same wage base

The $14,000 NH UI wage base is modest - a salaried employee crosses it within 8-12 weeks of January. Matchbook still models Section 125 employer UI savings for the first quarter but suppresses the UI savings line for YTD-above-base employees in the NH employer ROI report. The durable employer payroll-tax win for NH is the 7.65% FICA match on Section 125 and Section 132(f) elections, matched across salaried and hourly populations.

Employer FICA

7.65% / 1.45% split

Employer FICA is 7.65% on wages up to the Social Security wage base ($176,100 in 2025; projected about $183,600 in 2026) and 1.45% above it. Matchbook models this per employee rather than quoting a flat rate.

Employer credits and levers

State and federal credits worth stacking

Credits that most broker ROI decks omit. Matchbook surfaces these in the employer report.

NH Community Development Finance Authority (CDFA) Tax Credit

New Hampshire businesses donating to CDFA-approved community projects receive a 75% state tax credit against Business Profits Tax, Business Enterprise Tax, or Insurance Premium Tax. Donation also deductible federally. Annual program cap $5M. Frequently used to fund workforce housing, childcare capacity, and nonprofit workforce programs that directly reduce employee household cost.

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NH Research and Development Tax Credit

State R&D credit equal to 10% of qualified federal R&D expenses, capped at $50,000 per taxpayer per year with a $7M annual statewide cap. Credit applies against Business Profits Tax and Business Enterprise Tax, with 5-year carryforward. Matchbook surfaces this when an NH employer funds internal tooling or benefits-tech builds that qualify as Section 174 research.

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NH Education Tax Credit (Scholarship Program)

85% credit against Business Profits Tax, Business Enterprise Tax, or Interest and Dividends tax (the latter moot post-2025) for donations to approved scholarship organizations serving K-12 students. Statewide cap $5.1M in 2025. A CIT-offset lever that stacks with the CDFA credit for NH employers with BPT or BET liability.

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Federal IRC Section 45F (employer childcare credit)

Federal employer-provided childcare credit. 25% credit with $150K cap in 2025; rises to 40% with $500K cap in 2026, and 50% with $600K cap for small employers. Particularly relevant in NH given limited state childcare subsidy capacity - on-site or sponsored care is one of the few levers that moves household childcare cost meaningfully.

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Household programs

State programs that change what your employees should elect

Matchbook coordinates these against DCFSA, FSA, and HSA elections at the household level.

Childcare subsidy

NH Child Care Scholarship

State-administered subsidized childcare for income-qualifying families, operated by DHHS Division of Economic and Housing Stability. As of 2024-2025, entry eligibility at or below 85% State Median Income with expanded exit eligibility; family copayments capped at 7% of income per federal CCDF rules.

Matchbook: NH Child Care Scholarship reduces out-of-pocket dependent-care cost and therefore reduces the right DCFSA election. Matchbook asks NH employees whether they qualify before recommending DCFSA contribution levels, and flags the narrow provider network in rural counties.

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Preschool

NH Head Start and Early Head Start

Federally funded preschool for 3-5 year olds (Head Start) and ages 0-3 (Early Head Start) for families at or below 100% FPL, plus categorical eligibility for TANF, SSI, and foster children. Part-day and full-day options vary by grantee across NH's five Head Start regions.

Matchbook: When a household combines Head Start part-day with wrap-around care, the correct DCFSA election is the full-day cost minus Head Start hours, not zero. Matchbook models this split explicitly for NH families.

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Paid family leave

Granite State Paid Family Leave (voluntary program)

New Hampshire's unique voluntary PFL program launched January 2023 through a state contract with MetLife. Employers with 50 or more NH employees that purchase the plan receive a Business Enterprise Tax credit equal to 50% of premiums paid. Workers at employers that do not offer it can purchase individual PFL coverage through the same pool. Provides up to 6 weeks at 60% of wages for qualifying family or medical leave.

Matchbook: This is the single most NH-specific coordination problem Matchbook solves. For employers that opt in, Matchbook surfaces the BET credit in the employer ROI report and integrates benefit timing with FMLA and short-term disability. For employers that do not, Matchbook points employees to the individual-purchase path during open enrollment.

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Health programs

Coverage coordination checkpoints

NH Healthy Kids (CHIP) and Medicaid for Children

Combined CHIP and child Medicaid program. Children up to age 19 in families up to 318% FPL are eligible with no premium (CHIP premium was eliminated in 2023). Administered by NH DHHS through the same portal as adult Medicaid.

Matchbook: Employees declining dependent coverage on the employer plan should be screened against NH Healthy Kids thresholds before Matchbook defaults to the family tier - the 318% FPL cap is among the most generous in the country.

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NH Medicaid - Granite Advantage and post-unwind status

NH expanded Medicaid through the Granite Advantage Health Care Program. Post-PHE unwinding through mid-2024 produced significant procedural disenrollments; DHHS has since re-opened multiple redetermination cycles. Open enrollment is the right touchpoint to recover procedurally-disenrolled dependents onto employer coverage or NH Healthy Kids.

Matchbook: Matchbook's NH screener flags households that may have lost Granite Advantage coverage for procedural reasons and offers the re-enrollment or employer-plan path.

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ACA Marketplace (Federally Facilitated Marketplace)

New Hampshire uses the federal exchange (HealthCare.gov). 2026 employer-affordability threshold is 9.96% of household income. Enhanced premium tax credits expired at the end of 2025, so NH 2026 individual-market premiums see double-digit increases; Anthem, Ambetter, and Harvard Pilgrim remain the three on-exchange carriers.

Matchbook: If employer family coverage exceeds 9.96% of household income, Matchbook surfaces the Marketplace dependent subsidy path - especially material in NH after the enhanced PTC expiration, given the thin carrier field.

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Retirement and wealth

State-level retirement and wealth context

NH Stable Account (ABLE)

New Hampshire's Section 529A program for disabled beneficiaries, administered through the national STABLE Account network. 2025 contribution limit $19,000; employed beneficiaries may add up to $15,060 more via ABLE to Work. $500K balance cap; $100K SSI asset-test exclusion.

Matchbook: FSA or HSA dollars reimburse medical expenses; NH Stable covers broader qualified disability expenses. When SSI asset limits are in play, Matchbook routes disability-related spend to NH Stable first.

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UNIQUE College Investing Plan (NH 529)

NH's 529 plan, administered by Fidelity. No NH state income tax deduction exists because NH has no tax on wages and the Interest and Dividends tax was repealed effective 2025. NH residents can use any state's 529 plan without penalty; no home-state tax tilt.

Matchbook: Matchbook does not over-weight UNIQUE for NH employees when evaluating household college-savings strategy - Fidelity expense ratios and fund lineup are the relevant inputs, not a missing state deduction.

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Section 132(f) commuter

Pre-tax commuter reality in New Hampshire

2025 IRC Section 132(f) cap is $325 per month for transit and $325 per month for qualified parking.

Parking and state credits

Parking: Most NH markets (Manchester, Concord, Nashua, Portsmouth) have parking costs well below the $325 cap; the live §132(f) lever for NH employees is the Boston-commuter population using Boston Express or C&J to North Station or South Station, where monthly passes plus Boston-side parking approach the cap.

State credit: None - New Hampshire has no state-level commuter tax credit. Advance Transit is fare-free, which removes §132(f) transit benefit utility for Upper Valley commuters; Matchbook suppresses the commuter-pass recommendation for that cohort.

Disaster readiness

New Hampshire disaster-relief playbook

IRC Section 139 qualified disaster relief payments are not W-2 wages: no FICA, no FUTA, no federal income tax withholding, and the employer gets a full deduction. Triggered by a federal disaster declaration. Recent NH federal declarations include the December 2023 storm and flooding (DR-4760), the July 2021 flooding, and the historic December 2008 ice storm; nor'easters and ice storms are the primary NH disaster vectors.

  • Pre-drafted Section 139 policy template so NH employers can disburse tax-free relief (generator fuel, temporary lodging, tree-damage repair, ice-storm cleanup, well-pump replacement) within 48 hours of a federal declaration.
  • Post-storm Section 125 election-change guidance: a nor'easter or ice storm alone is not a listed change-in-status event under Treas. Reg. 1.125-4 - it qualifies only when it triggers a change in residence, employment, or cost-of-coverage.
  • FEMA Individual Assistance interaction: IRS Section 139 payments generally stack with FEMA IA, but Matchbook flags duplication risks in the disbursement log.
  • NH-specific employer disaster leave review: NH has no statutory paid disaster leave and the Earned Time statute (RSA 275:49) only governs accrued PTO payout at separation, so employer policy is the governing rule during closures.
Matchbook for New Hampshire

What we ship specifically for New Hampshire employers

  • No-state-tax calibration in the employee savings engine - recompute marginal stacks at 0% state (post-I&D-repeal) and widen DCFSA and FSA under-election guardrails for NH households.
  • Granite State Paid Family Leave coordination: if the employer has elected the program, surface the 50% BET premium credit in the employer ROI report and model FMLA / STD / PFL timing; if not, route employees to the individual-purchase path during open enrollment.
  • NH CDFA, R&D, and Education Tax Credit stacking calculator for employers with BPT or BET liability - the 75% and 85% credits are unusually high and underused.
  • Suppress the UI savings line for YTD-above-$14K employees in the NH employer FICA and SUI report; retain for Q1 and for seasonal or part-time cohorts.
  • IRC Section 139 nor'easter and ice-storm playbook template with pre-drafted employer policy and post-storm Section 125 election-change guidance.
  • NH Healthy Kids (318% FPL) and Granite Advantage redetermination screener at open enrollment to recover procedurally-disenrolled dependents.
  • Commuter module: suppress §132(f) transit-pass recommendation for Advance Transit (fare-free) riders; elevate it for Boston-commuter bus and rail cohorts where the $325 cap is in play.
  • Benefits graph ingests: NH DRA BPT and BET credit data, NH DES UI rate notices, NH DHHS Child Care Scholarship and Healthy Kids eligibility, NH PFML enrollment data, FEMA DR numbers for NH, and FFM 2026 rate filings.
Sources

Primary sources for this playbook

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