The New Hampshire Business Profits Tax is an 8.5% tax assessed on income from conducting business activity within the state.It is paid by any entity organized for gain or profit and carrying on business activity within the state.. Businesses with $50,000 or less of gross business income from all their activities are not required to file a return, thus your business would have to deal with the tax.
The starting point for determining the tax base is Federal taxable income from your Federal return and there is a deduction allowed for a "reasonable" salary paid to the partners or proprietors or a business that is organized as a sole proprietorship. This cite can be found at N.H. Rev. Stat. Ann. § 77-A:4(III)(a). Thus, that $75K would likely be taken out of the total profits used to determine the tax base.
Next, the Business Enterprise Tax is a 0.75% tax assessed on the enterprise value tax base, which is the sum of all compensation paid or accrued, interest paid or accrued, and dividends paid by the business after special adjustments and apportionment. Businesses are required to file this return if they have more than $150,000 of gross receipts from all their activities or an enterprise value tax base more than $75,000. For this tax, the base DOES include compensation paid to partners or proprietors of the business. Deductions would be allowed for any compensation paid to other employees. This cite can be found at N.H. Rev. Stat. Ann. § 77-E:3(I). Thus, your $75K salary would be included in the tax base for this tax.
You can register your business and get more information on these taxes by contacting the NH Secretary of State's Office at(NNN) NNN-NNNNor(NNN) NNN-NNNN or be using the NH Dept. of Revenue Administration's website here:
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