A few weeks ago we posted an update on the PPP legislation that had recently been signed into law by the Governor. Check out the post for more details.
Remote Workers Update
Due to the pandemic many individuals began working from home. Massachusetts told employers that these remote workers should continue to be taxed to the state of Massachusetts, even if they began working from home in New Hampshire. New Hampshire sued Massachusetts claiming this treatment violated the constitution. Unfortunately for impacted New Hampshire residents, the case made its way to the Supreme Court where it was ultimately rejected. Individual employees who worked in Massachusetts but stayed home during the pandemic will continue to pay taxes to Massachusetts on their wages. To read more about this case, see the Journal of Accountancy's post.
Tax Updates Included In the Recent Budget
Another recent development in the state of New Hampshire was the passing of the budget for the next two years. The budget included tax provisions which lower the business tax rates in the state.
- In January 2022 the Business Profits Tax rate will decrease from 7.7% to 7.5%
- In January 2022 the Business Enterprise Tax (BET) rate will decrease from 0.6% to 0.55%
- At the same time the BET filing threshold will increase to $250,000, this includes both the gross business receipt threshold ($217,000 for 2020) and the enterprise value base ($108,000 for 2020)
- The meals and rooms tax will also be decreasing from 9% to 8.5%
- The interest and dividends tax, currently 5%, will begin to phase out for years from 2023 to 2027 – this particular change would benefit certain businesses and individuals. The rate will decrease to 4% in calendar year 2023, followed by a 1% decrease annually. The tax will be eliminated in 2027 if not changed by future legislation.
If you have questions, contact your accountant and remember to follow us on LinkedIn to stay up to date on all of our posts.