New Hampshire is one of two states that only imposes a state tax on the income from interest and dividends. This means that most forms of unearned income that is usually subject to taxation in other states, such as unemployment compensation or retirement distributions, are exempt from tax in New Hampshire. If you have prepared a tax return in a different state, be sure to read the New Hampshire Department of Revenue Administration guidelines regarding taxable income carefully before you begin.http://www.nh.gov/revenue/forms/By_Number/documents/ID_Booklet.pdf

Most New Hampshire residents will not be required to submit a tax return at all. While interest and dividends are taxable, you must have received more than $2,400 from these sources before you will be obligated to file a state return.http://www.nh.gov/revenue/forms/By_Number/documents/ID_Booklet.pdf If you received lottery winnings, you will be required to file a Form DP-300 "Gambling Winnings Return."http://www.nhtaxhelp.org/State_Tax_Info_files/DP-300%20Form%20and%20Instructions.pdf Be sure to read the tax form instructions carefully to understand the filing requirements.http://www.nh.gov/revenue/forms/By_Number/documents/ID_Booklet.pdf

NOTE: The New Hampshire filing deadline has been extended from April 15 to April 18, 2011 due to the legal holiday Emancipation Day celebrated in the District of Columbia.http://www.nh.gov/revenue/forms/By_Number/documents/ID_Booklet.pdf 

To begin preparing your New Hampshire tax return, start by collecting all of the tax information you will need to complete your state form:

1. Your Social Security number
2. Your complete mailing address
3. The name and Social Security number of your spouse, if you are filing a joint tax return
4. Documentation of your bank interest or dividends received during the year - This information will be reported to you on a Form 1099-DIV for dividends or a Form 1099-INT for interest. Be sure you are not including interest you paid!
5. The total of any state income taxes you have already paid through voluntary estimated tax payments
6. A copy of your federal income tax return, if you are filing onehttp://www.nh.gov/revenue/forms/By_Number/documents/ID_Booklet.pdf 
   

If you are filing a federal tax return, be sure to complete that before you begin your New Hampshire forms. This will help you to make sure that the information on both forms is consistent. If you are not required to file a federal income tax return, you can go ahead with the completion of your New Hampshire return.http://www.irs.gov/pub/irs-pdf/f1040.pdf 

Electronic filing, also called e-filing, is strongly encouraged because it speeds up the processing time of the return. If you are filing your federal income tax return electronically with tax preparation software, you will generally be given the option to include your New Hampshire return for an extra fee.https://www.efilenh.govconnect.com/web/introduction.asp 

Now, you can begin working on your New Hampshire state return. If you have access to the Internet, you can download the Form DP-10 "New Hampshire Department of Revenue Administration Interest and Dividends Tax Return," along with the instruction booklet from the New Hampshire Department of Revenue website. If you do not have Internet access, you can usually find a paper copy of the form and instructions at your local library. Should you choose to complete the form by hand, be sure to write legibly and use black ink to avoid processing delays.http://www.nh.gov/revenue/forms/By_Number/documents/dp_10.pdf 

Begin the form by entering your full name and Social Security number, as well as your spouse's if applicable. Complete the address section and select the type of return you are filing. Now is a good time to stop and read the tax form instructions in their entirety. The instructions provide a detailed explanation of how to complete each line on the tax form.http://www.nh.gov/revenue/forms/By_Number/documents/ID_Booklet.pdf 

At this point in the form, you will stop and complete page 2 of the return before proceeding. On this page, you will determine exactly how much of your interest and dividend income is taxable by the state. Begin by transferring the amount of your interest and dividend income as reported on your federal return. Then follow the form instructions to arrive at your New Hampshire taxable income.http://www.nh.gov/revenue/forms/By_Number/documents/dp_10.pdf 

Carry that figure forward to line 10 of page 1 on your New Hampshire return. Multiply this amount by the 5 percent tax rate to calculate your tax liability. Then, subtract any estimated tax payments you have made or credits for previous tax paid to see exactly how much tax is due. Add any additional taxes and penalties to calculate how much tax you will have to remit with your return.http://www.nh.gov/revenue/forms/By_Number/documents/dp_10.pdf 

If there are additional taxes due, you will need to make a payment. If you have overpaid through estimated taxes or prior years' credits, you will receive the overpayment as a refund. It will take about 12 weeks to receive your refund if you file by mail.http://www.nh.gov/revenue/forms/By_Number/documents/dp_10.pdf

To finish your return, sign and date the form and have your spouse do the same. Make a copy of the completed return for your personal records. If you are entitled to a refund, send the return to the address listed on the bottom of the form. Be sure to submit it by April 18, 2011.http://www.nh.gov/revenue/forms/By_Number/documents/ID_Booklet.pdf 

If you have a balance due, you will need to include a check or money order for the amount of your outstanding tax balance. If this is not paid before April 18, you will be assessed a late payment penalty, as well as compound interest on the balance until it is paid in full. To avoid this, try to pay your entire balance along with your return.http://www.nh.gov/revenue/forms/By_Number/documents/ID_Booklet.pdf 

If you are unable to pay the full amount, include a check or money order for what you can afford at the time and then contact the New Hampshire Department of Revenue Administration about establishing a payment plan. This may help you to avoid late payment penalties.http://www.nh.gov/revenue/forms/By_Number/documents/ID_Booklet.pdf 

Should you decide to file your state return electronically, you may be given the option of paying your outstanding balance with a credit card. While this may seem advantageous, be sure to check your credit card interest rates. It may actually cost you less to pay using the state payment plan, since the state interest rate is usually much lower than a credit card rate.http://www.nh.gov/revenue/forms/By_Number/documents/ID_Booklet.pdf

To get additional time to complete your New Hampshire state tax return, you may want to read about how to get a state tax extension in New Hampshire.