The New Hampshire Department of Revenue Administration has issued a technical information release, in which it explains the application of the interest and dividends (I&D) tax with respect to grantor and nongrantor trusts. In 2012, New Hampshire enacted legislation, eliminating any I&D tax on nongrantor trusts.
As the TIR explains, the I&D tax applies to resident grantors and resident beneficiaries. If the grantor of a grantor trust is a New Hampshire resident, then the grantor must report the trust’s interest and dividends. If a beneficiary of nongrantor trust is a New Hampshire resident, then the beneficiary must report the amount of interest and dividends that, for federal tax purposes, the beneficiary reports as receiving from the trust.
For a copy of the release, see TIR 2014-002
For more on the tax law change, see New Hampshire Enhances Its Trust Tax Laws.