About 30.5 percent of federal tax returns filed by Granite Staters for Tax Year 2022 recorded more than $100,000 in Adjusted Gross Income, according to aggregated data from the U.S. Internal Revenue Service. That is an increase, unadjusted for inflation, from 18.4 percent in Tax Year 2013, 22.3 percent in 2017, and 28.7 percent in 2021.
The percentage of tax filers with these higher incomes has increased, but the value of the dollar has decreased with inflation. Adjusting for inflation facing consumers in the northeastern United States, $100,000 in 2013 purchased the same amount of goods and services as $121,797 in 2022, or $130,260 in 2024.
Although nearly one-third of all tax filers in New Hampshire had $100,000 of income in New Hampshire, tax filings could represent individuals or families, which would result in substantially different sets of expenses. Estimates of the cost of living in New Hampshire suggest households with multiple children in New Hampshire could face expenses of nearly $100,000, depending on exact composition, location, and employment patterns, to meet basic needs or have a modest yet adequate standard of living.
The distribution of higher income tax filers also varies substantially by city or town in New Hampshire. These estimates, which are derived from ZIP code data and converted into municipal-level analyses, show that five communities had at least half of tax returns reporting more than $100,000 in Adjusted Gross Income: Hanover (54.4 percent), Hollis (52.7 percent), Windham (52.0 percent), Amherst (50.2 percent), and Bedford (50.0 percent). Four of those five communities are in the southern, suburban part of the state, and all five are near larger cities or towns.
Six communities had less than 15 percent of tax returns with over $100,000 in income: Claremont (14.8 percent), Franklin (14.3 percent), Benton (13.6 percent), Berlin (12.1 percent), Success (12.1 percent, an unincorporated township sharing a ZIP code with Berlin), and Stratford (11.4 percent). All these communities except for Franklin were outside of the state’s four southeastern counties, and all were further from metropolitan Boston than the highest income-concentration communities outside of Hanover.
Tax return data do not reflect the entire population; many people with incomes below the Standard Deduction do not need to file a federal income tax return.
Income is also earned from a variety of different sources. About 65.2 percent of all reported income came from salaries and wages, while 9.3 percent was from taxable individual retirement arrangements, pensions, or annuities. Capital gains accounted for 10.3 percent of income collected, while net business, partnership, or S-corporation income was 8.3 percent of reported income.
The relative importance of these sources of income varied by income group, too. For New Hampshire filers with more than $1,000,000 in Adjusted Gross Income in 2022, 27.9 percent of income came from salaries and wages while 43.5 percent was the result of capital gains, accounting for 71.1 percent of all reported capital gains income collected in New Hampshire that year.
Learn more about federal income tax data in New Hampshire in NHFPI’s September 2024 analysis Federal Policymakers Will Consider Tax Changes Benefitting Higher-Income Granite Staters in 2025.