The proposed bill, HB 502-FN, seeks to reform New Hampshire's tax structure by repealing the water's edge combined group provisions of the business profits tax, which previously allowed multinational corporations to separate their U.S. and foreign operations for tax purposes. The bill reinstates the complete corporate reporting method, treating parent corporations and their subsidiaries as a single taxpayer to prevent profit shifting to foreign tax havens. Additionally, it introduces new definitions for "combined net income" and "foreign dividends," and mandates that revenues from the state education property tax be deposited into the education trust fund, with revised procedures for calculating state education grants. The bill also establishes a committee to study the Low and Moderate Income Homeowners Property Tax Relief program, which includes modifications to eligibility criteria and the introduction of annual inflation adjustments.

Furthermore, HB 502-FN significantly alters the Low and Moderate Income Homeowners Property Tax Relief program by raising income thresholds for eligibility and eliminating certain percentages of tax relief for higher income levels. The bill deletes previous income brackets and replaces them with new thresholds, offering 100% relief for households earning less than $37,500 and gradually reducing relief for those earning above that amount, with a complete elimination for households earning more than $77,500. It also caps total tax relief checks at $30 million per fiscal year and requires the Department of Revenue Administration to mail application forms to eligible homeowners annually. The bill's effective date for most provisions is set for January 1, 2026, while the committee's establishment takes effect immediately upon passage.

Statutes affected:
Introduced: 76:8, 76:11-a, 77-A:1, 198:39, 198:57