What is the necessary New Hampshire depreciation adjustment to gains or losses on the sale of business assets?

New Hampshire does not conform to the federal treatment of bonus depreciation. This results in a higher basis at the time of sale (for New Hampshire tax purposes) resulting in a potentially lower gain (or smaller loss) on the sale of those assets. The difference would depend on the asset and how much bonus or 179 depreciation had been taken at the federal level.

New Hampshire decouples from I.R.C. § 168(k). N.H. Rev. Stat. Ann. § 77-A:3-b; N.H. Rev. Stat. Ann. § 77-A:1(XX)(l); CITN NH 5.3.1.2. What this means is New Hampshire does not allow, for state tax purposes, bonus depreciation and Sec 179 expensing.  Consequently, you would not be able to claim these deductions on your New Hampshire tax return, even though you were able to claim them on your federal return.

The "pay-back" is that when you sell a business asset in New Hampshire, its basis (for New Hampshire tax calculations) would be higher by the amount of bonus and Sec 179 deductions taken at the federal level. Higher basis at time of sale >>> Less taxable gain on sale.