New Hampshire at a glance
Partnership law
UPA (original)
LLC default split
Proportional to capital
Operating agreement
Not required
Community property
No
Formation cost
$100
Annual cost
$100 annual report fee
New Hampshire is one of the few states still on the original UPA. The state has no income tax on earned income (it previously taxed interest and dividends, but that tax was phased out). New Hampshire follows traditional LLC defaults based on capital contributions.
Default partnership rules in New Hampshire
New Hampshire follows the original Uniform Partnership Act (UPA). Partnerships are treated as an aggregate of their partners, and a partner's departure automatically dissolves the partnership. Profits and losses are shared equally by default. Partners are jointly and severally liable for partnership debts. A written partnership agreement with continuation clauses is critical in New Hampshire.
The most important takeaway: profits are split equally by default in New Hampshire, regardless of capital contributions. If you and a partner start a business and one of you invests $100,000 while the other invests $5,000, you still split profits 50/50 without a written agreement. This is true in every US state, including New Hampshire.
LLC defaults in New Hampshire
New Hampshire allocates LLC profits and losses in proportion to capital contributions by default. An operating agreement is not required. The state does not tax earned income (its interest and dividends tax was fully phased out as of 2025). However, New Hampshire does impose a Business Profits Tax and a Business Enterprise Tax on certain businesses.
New Hampshire defaults to proportional distributions based on capital contributions, which aligns better with many founders' expectations than equal-split states. However, capital contributions alone rarely tell the full story. A founder contributing time and expertise may receive nothing if they didn't invest cash. An operating agreement can account for all types of contributions. Our equity calculator can help you determine a fair arrangement.
What happens when a partner leaves in New Hampshire
Under New Hampshire's UPA, a partner's departure automatically dissolves the partnership. The remaining partners must wind up the partnership's affairs before reforming if they wish to continue. This makes written partnership agreements especially important in New Hampshire.
Important: Because New Hampshire follows the original UPA, a partner's departure automatically dissolves the partnership. This is a significant risk that can disrupt the business, alarm creditors and clients, and create tax complications. A written partnership agreement with a continuation clause is essential for any New Hampshire partnership with more than one partner.
Marriage and business equity in New Hampshire
New Hampshire is an equitable distribution state. Business interests acquired during the marriage are divided equitably in a divorce. The court considers all relevant factors in making a fair division of property.
Even though New Hampshire is not a community property state, marriage can still affect your business equity. In equitable distribution states, courts divide marital property based on what is fair, which may include business interests acquired or grown during the marriage. A clear equity agreement and proper documentation of ownership can help protect your business in the event of a divorce.
Formation and cost considerations in New Hampshire
| Formation cost | $100 |
| Annual/recurring cost | $100 annual report fee |
| State income tax | No |
| Partnership law | UPA (original) — partner departure dissolves the partnership |
| LLC default distributions | Proportional to capital contribution |
| Operating agreement | Not required (strongly recommended) |
Frequently asked questions
Does New Hampshire have a state income tax?
New Hampshire does not tax earned income. The state's interest and dividends tax was fully phased out as of 2025. However, New Hampshire does impose a Business Profits Tax and a Business Enterprise Tax on businesses meeting certain revenue thresholds.
Does New Hampshire use UPA or RUPA?
New Hampshire still follows the original UPA. A partner's departure automatically dissolves the partnership. Written partnership agreements with continuation clauses are essential.
What is the default LLC profit split in New Hampshire?
New Hampshire defaults to proportional allocation based on capital contributions. An operating agreement can establish a different arrangement.
How much does a New Hampshire LLC cost?
New Hampshire LLC formation costs $100, and the annual report fee is $100. First-year costs are at least $200 before legal fees.
Related resources
- Equity calculator: find a fair split for your business
- Does your small business need an equity agreement?
- Equity for small businesses: the complete guide
- Dead equity calculator: how much is yours costing you?
- Slicing Pie calculator
- What is an operating agreement?
- All 50 states: partnership and LLC default rules
Partnership laws in neighboring states
Disclaimer: This page provides general information about New Hampshire partnership and LLC default rules and is not legal advice. Laws change, and the information here may not reflect the most recent amendments. The formation costs and annual fees listed are approximate and may vary. Consult a qualified attorney licensed in New Hampshire for advice specific to your situation. Equity Matrix is a software tool for tracking contributions and calculating equity; it does not provide legal services.
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