The simple answer is yes. I live in NH and work in MA and pay MA income tax. It is a little different though since I don't have to worry about Romnycare's tax penalty for no insurance (which I have anyway). If you start an LLC that mostly works out of NH you may be able to escape the MA income tax by working through your LLC by a 1099. How ever you will still get hit by the NH's self employment tax is you make over 50k or so.