Massachusetts and New Hampshire, weighed as two operating environments.
Not which state is better, the wrong question. This instrument weighs both environments
on the same five decision lenses and shows which coordination priorities change when the
environment does. Same reasoning every state is read through; here, side by side.
Each lens turns a tax environment into a household decision.
A dashed row means the two environments read the same on that lens; a solid row means they differ.
high
Rate pressureHow much does the state erode each realized gain?
none
MassachusettsThe state takes 9% of every long-term gain at the top, high drag on what a realized return keeps.
New HampshireNo state tax on gains, every realized gain keeps its full federal-only outcome.
severe
Estate exposureDoes the state tax the estate below the federal threshold, and how steeply?
none
MassachusettsA state estate tax exempts only $2M, far below the federal ~$15M; severe exposure at death that federal-only planning misses.
New HampshireNo state estate or inheritance tax, only the federal estate tax reaches the estate.
high
Harvesting leverageHow much is a harvested loss worth here?
low
MassachusettsA harvested loss is worth the 9% state rate it offsets, on top of federal, high harvesting leverage.
New HampshireWith no state tax on gains, a harvested loss recovers only its federal value, the state adds no rate for it to offset.
high
Mobility valueHow much could a change of residency be worth?
none
MassachusettsBoth the rate and the estate regime make relocation genuinely valuable, but domicile is a fact pattern, not a mailing address.
New HampshireAlready a no-income-tax, no-estate-tax state, the destination other households move toward, not from.
low
Basis coordinationWhat basis-step-up opportunity does the marital-property regime create?
low
MassachusettsCommon-law basis: only the decedent's half steps up at the first death, plan titling so the survivor is not left with low-basis lots.
New HampshireCommon-law basis: only the decedent's half steps up at the first death, plan titling so the survivor is not left with low-basis lots.
Which coordination priorities change
The household's operating-system domains each environment opens.
The middle column holds where they agree; the outer columns are what is unique to each.
Only Massachusetts
Residency & domicile· advisor + CPA
Whether, and how, a change of domicile is worth pursuing, and the facts (days, home, ties) that make it real rather than nominal.
Estate structure· estate attorney
Whether the state's estate exposure warrants credit-shelter / QTIP titling or lifetime gifting to move value below the state threshold.
Loss harvesting· advisor + CPA
Setting a harvesting cadence that captures the state rate a banked loss offsets, sequenced against the state's loss-carryforward rules.
Asset location· advisor
Placing the high-turnover sleeve in tax-advantaged accounts so the state's rate falls on the least of the household's realized gains.
Shared
None triggered.
Only New Hampshire
None triggered.
The facts underneath
Dimension
Massachusetts
New Hampshire
Capital-gains rate
9%Loss treatment conforms to federal: capital losses net against gains and carry forward. Top effective long-term rate 9%. Quirk: 5% long-term + a 4% surtax over ~$1.1M; short-term 8.5% likewise + the 4% surtax.
0%No state tax on capital gains, and a harvested loss is worth only the federal rate here.
Estate & inheritance
estateState estate tax (paid by the estate): top rate ~16%, exemption ~$2M. $2M exemption with a uniform $99,600 credit; the 2023 reform removed the old cliff, so only value above $2M is taxed.
No state estate or inheritance tax, only the federal estate tax applies.
Marriage treatment
flatA single flat rate regardless of filing status, marriage-neutral on rate; watch fixed-dollar exemptions and AGI thresholds.
No state income tax, no marriage penalty on the state return.
Loss treatment
federalCapital losses carry forward under the federal Section 1212 rules, a harvested loss nets against gains and rolls forward until used.
No state tax on capital gains, so a harvested loss carries no state benefit; its value here is only the federal offset.
Municipal bonds
in-stateOnly in-state municipal-bond interest escapes state tax; bonds from other states are taxed. The classic in-state muni preference that rewards a home-state ladder.
exemptMunicipal-bond interest is exempt from state tax whether the issuer is in-state or out-of-state, the broadest muni preference (states with no tax on investment income, plus a few that exempt all munis by statute).
QSBS (§1202)
§1202 okConforms to IRC §1202, the federal qualified small business stock gain exclusion carries through to the state return.
no §1202No distinct state QSBS position applies here, either the jurisdiction levies no tax on the gain, or it does not separately recognize the §1202 exclusion. Confirm with a tax advisor.
Illustrative coordination gap
Because the rules differ, so does what coordination is worth. On an illustrative 30-year path, running a portfolio against each state's rules is worth an estimated ~$48,000/yr per $1M taxable in Massachusetts versus ~$37,000/yr in New Hampshire, the coordination gap between the two (about +4.8%/yr vs +3.7%/yr modeled). A hypothetical, illustrative figure; the household's own depends on bracket, holdings, and residency (see the full basis of the estimate below).
A difference between two states is a decision waiting to be coordinated.
Turn it into a sequenced operating plan for a move, or fold it into a household's standing coordination record.
State law reflects 2025 tax-year law; last reviewed 2026-07-07. Every classification is a summary of state law; where a primary-source citation has been verified, it is linked on the card.
What changed
2026-07-07, First law-review date and honest per-cell source labeling; primary-source citations verified for Illinois, California, New York, Texas, and Florida (more in progress).
2025, Washington's 7% (+2.9%) excise on long-term capital gains reflected (enacted 2022).
2025, New Hampshire's Interest & Dividends tax reflected as fully repealed, effective 2025.
2025, Illinois estate-tax detail tracks the pending SB 2970 as of the review date.
Illustrative / hypothetical, not a real track record and not advice. The tax-management impact figure is a hypothetical, after-tax result from the retroactive application of a tax-management model to ~30 years of proxy-spliced market data on a single illustrative path; no client capital was invested, and hypothetical performance does not guarantee future results. Intended for sophisticated investors; it may not be relevant to your situation, and your actual figure depends on your own holdings, basis, and bracket. State tax facts reflect tax year 2025 and can change, confirm with a tax advisor. Driftwood Wealth is the private-wealth practice of Alec Messino. Securities products and advisory services offered through Park Avenue Securities LLC (PAS), member FINRA, SIPC. Alec Messino is a Registered Representative and Financial Advisor of PAS. Driftwood Wealth is not an affiliate or subsidiary of PAS. All figures are illustrative models for educational purposes, not investment, tax, or legal advice, and not a recommendation.
Driftwood. State tax law reflects 2025 tax-year law; last reviewed 2026-07-07. A comparison is a view of the reasoning graph, it authors no facts of its own.