Question regarding LLC taxation in NH... (leases, taxi, income)

[30somethings]

Hi everyone,

I heard that there have been some recent changes in the taxation of LLC's in NH and I had a quick question for those of you who are in the know.

If someone owns a small business that is already set up as an LLC in another state and ends up moving to NH, does that person get hit with the new LLC tax?

Thanks in advance.

[MtnFlyer]

The answer to your question lies in whether or not a "nexus" can be established. Read up on the Business Profits Tax at the New Hampshire Department of Revenue's site.

Nexus is defined as some definite link, or minimum connection, between the state and the entity it seeks to tax. Normally, sufficient nexus for income tax purposes (NH Business Profits Tax) is established when an entity owns, leases property or performs services in the state, employs personnel in the state or has capital or property in the state. If you are an out-of-state business that sells or leases tangible personal property in this state check out N.H. Code of Admin. Rule, Rev. 304.01 for statutes regarding establishment of a nexus.

[NHartphotog]

They're in the process of repealing the tax now.

[30somethings]

To both of you, thanks for the info...

MtnFlyer: So correct me if I'm wrong, but it sounds to me as though the owner of the out of state LLC would in fact be liable for income taxes if they were a NH resident.

NHartphotog: Any estimate on when that repeal will be a possibility?

[MtnFlyer]

Currently it's very possible. Also don't forget that even though there is technically no income tax for regular wages, there is a tax on interest and dividend income.

[NHartphotog]

Originally Posted by NHartphotog

They're in the process of repealing the tax now.

They WERE going to repeal it; all these new taxes are driving business from NH at a time when the economy can least afford it. But the Democrats got the repeal stalled. A rush decision to pass new taxes, then years of trying to go back to where we were before the NH legislative spending/taxing spree of the past few years.

[30somethings]

Originally Posted by NHartphotog

They WERE going to repeal it; all these new taxes are driving business from NH at a time when the economy can least afford it. But the Democrats got the repeal stalled. A rush decision to pass new taxes, then years of trying to go back to where we were before the NH legislative spending/taxing spree of the past few years.

That is such a shame and most certainly a dealbreaker for me.

[JukieF]

I saw something on the news about this tonight, but I wasn't paying any attention. You might check the WMUR web site and see if there's a story there. The little bit I caught said they were repealing it.