HB 635-FN-A – AS INTRODUCED
2007 SESSION
09/10
HOUSE BILL 635-FN-A
AN ACT removing exemptions under the interest and dividends tax.
This bill removes the $2,400 exemptions under the interest and dividends tax for partnerships, limited liability companies, associations, and trusts and for court-appointed fiduciaries.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
07-0804
09/10
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Seven
AN ACT removing exemptions under the interest and dividends tax.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Interest and Dividends Tax; Taxable Income. Amend RSA 77:3, I(b) and (c) to read as follows:
(b) Partnerships, limited liability companies, associations, and trusts, the beneficial interest in which is not represented by transferable shares[, whose gross interest and dividend income from all sources exceeds $2,400 during the taxable year, but not including a qualified investment company as defined in RSA 77-A:1, XXI, or a trust comprising a part of an employee benefit plan, as defined in the Employee Retirement Income Security Act of 1974, section 3].
(c) Fiduciaries deriving their appointment from a court of this state [whose gross interest and dividend income from all sources exceeds $2,400 during the taxable year].
2 Exemptions. Amend the introductory paragraph of RSA 77:5 to read as follows:
Each taxpayer described in RSA 77:3, I(a) shall have the following exemptions:
3 Effective Date. This act shall take effect July 1, 2007.
LBAO
07-0804
Revised 01/31/07
HB 635 FISCAL NOTE
AN ACT removing exemptions under the interest and dividends tax.
FISCAL IMPACT:
The Department of Revenue Administration has determined this bill may increase general fund revenue by $702,000 in fiscal year 2008 and each year thereafter. There will be no fiscal impact on county and local revenues or state, county, and local expenditures.
METHODOLOGY:
The Department states this bill removes the $2,400 exemption from the interest and dividends tax for certain entities. The Department assumes this law would take effect July 1, 2007 and the costs of administering it could be absorbed within the existing budget. The Department calculated increase in revenue for FY 2008 based on tax year 2005 returns. In that year there were 6,825 returns filed by entities with taxable interest and dividends that would be affected by this bill. The lesser of the $2,400 exemption which would be eliminated or their taxable income was multiplied by the 5% tax rate to arrive at an increase in tax revenue of approximately $702,000. The Department assumes this amount for fiscal year 2008 and each year thereafter.