North Dakota State Tax Enforcement Decision
Checklist
Introduction
State enforcement by the North Dakota Office of State Tax Commissioner occurs when taxpayers fail to comply with filing, payment, or reporting requirements. Enforcement refers to the formal administrative steps the state takes to collect unpaid taxes or secure missing returns.
Understanding enforcement procedures helps you respond appropriately and avoid additional interest and penalties, collection actions, or license suspension.
What This Issue Means
State enforcement represents formal action by the Tax Commissioner to address unpaid state taxes or unfiled returns. This includes collection notices, liens, levies, or other actions designed to compel payment or compliance with filing requirements. Enforcement indicates the state has moved beyond initial notices and is taking active steps to resolve outstanding tax issues affecting sales and use tax revenue and other collections.
Why the State Issued This or Requires This
The state enforces tax obligations when taxpayers do not respond to earlier notices about unpaid taxes, when returns remain substantially overdue, when payment arrangements are not followed, or when tax liability remains uncollected after reasonable notice periods. North Dakota tax law authorizes the Tax Commissioner to pursue collection and enforcement when standard billing notices do not produce tax compliance.
What Happens If This Is Ignored
Continuing to ignore enforcement actions typically results in escalated collection measures, including wage withholding orders to employers, bank levies, or notification to other state and local governments. The state may file a tax lien against your property, which affects your ability to sell or refinance assets. Interest and penalties continue to accrue on unpaid amounts during this period under state tax policy.
What This Does NOT Mean
Receiving an enforcement notice does not automatically mean criminal prosecution will follow, as enforcement is primarily a civil collection process. You have not lost your driver’s license, professional license, or other credentials simply by receiving notice, though additional
non-compliance could trigger those actions. An enforcement action does not mean all collection efforts have been exhausted or that settlement is no longer possible.
Step-by-Step Checklist: What to Do After Receiving This
or Identifying This Issue
Step 1: Read the Notice or Document Carefully
Identify the type of enforcement action, the tax type involved, such as sales tax or corporate income tax, the tax periods referenced, the contact information provided by the state, and any deadline mentioned in the document.
Step 2: Gather Your Tax Records
Locate your copy of the tax return for the period in question, collect receipts or documentation of claimed deductions, find records of payments already made, gather proof of filing, and organize prior correspondence with the state.
Step 3: Determine What the Enforcement Action Addresses
Confirm whether the issue involves a missing return or unpaid tax, identify the specific tax year or reporting period, note the amount stated, check whether interest and penalties are included, and verify your current contact information is on file.
Step 4: Contact the North Dakota Office of the State Tax Commissioner
Call 701-328-1244 for collections matters or email collectionstax@nd.gov to clarify the enforcement action, explain you have received an enforcement notice, ask for the name and contact information of the person handling your case, and request a written summary of the specific enforcement action.
Step 5: Determine If You Actually Owe the Tax or Disagree With the Amount
Review the tax calculation shown in the notice, compare it to your own records and the return you filed, identify any discrepancies between what you reported and what the state claims, note any payments you made that may not have been credited, and write down specific reasons you believe the assessment is incorrect.
Step 6: Respond to the Notice in Writing
Send a written response to the address provided in the notice, including your name, address, and tax identification number, reference the notice number and date, state clearly whether you agree or disagree with the amount, provide copies of supporting documents, and keep a copy for your records with confirmation of delivery.
Step 7: If You Agree the Tax Is Owed, Explore Payment Options
Contact the state to ask about available payment plans or installment agreements, request information on any penalties that might be abated or reduced, and ask whether partial payments are accepted. At the same time, arrangements are finalized, and it is clarified what happens to the enforcement action if a payment plan is approved.
Step 8: If You Disagree With the Assessment, Request Reconsideration
Ask the state in writing what specific evidence led to the assessment, explain in detail why you believe it is incorrect, provide documentation supporting your position, request a meeting or conference with the appropriate department, and ask about the formal appeal process if the state does not reconsider.
Step 9: Monitor for Follow-Up Communication
Watch for written confirmation from the state, note any new deadlines mentioned in responses, watch for additional notices or requests for information, keep all correspondence in a dedicated file, and follow up if you do not hear from the state within a reasonable timeframe.
- Ignoring the notice entirely: Silence does not resolve enforcement and typically
- Missing response deadlines: Meeting stated deadlines is critical because delayed
- Sending payment without addressing the underlying dispute: Clearly state your
- Failing to follow up: The state may not contact you again if your initial response was
- Assuming the state has your correct address or phone number: Confirm this
- Providing original documents instead of copies: Always send copies and keep the
- Assuming an agreement was reached without written confirmation: Verbal
- Misunderstanding tax compliance requirements: Remote sellers, small business
- State tax notice review and response
- Penalty and interest reduction options
- Payroll and trust fund tax assistance
- Payment plan and relief eligibility review
- Representation with state tax agencies
Step 10: Document Everything and Maintain Organized Records
Keep copies of every notice, letter, and document from the state; record the dates and names of anyone you speak with by phone; save email confirmations of submissions or requests; note payments made and amounts applied, and create a timeline of key events for your reference.
Common Mistakes to Avoid accelerates collection efforts, including wage garnishment, bank levies, or license suspension through state and local governments. responses can result in escalated collection actions or loss of appeal rights under administrative procedures. disagreement with the amount before or while paying to preserve your right to contest the assessment and protect due process rights. incomplete, unclear, or did not include the requested documentation. information directly because missed notices create additional legal issues and may result
in default judgments or collection actions. originals for your records, as submitted documents are typically not returned to taxpayers. agreements are not enforceable, so request a written payment plan or settlement agreement documenting all terms and conditions. owners, and marketplace facilitators must understand their obligations under North
Dakota's economic nexus law to avoid enforcement actions related to sales tax collection, notice, and reporting requirements.
Understanding North Dakota Tax Types Subject to
Enforcement
The Office of the State Tax Commissioner enforces various taxes, including corporate income tax based on net income, sales and use tax, and other state and local taxes. Enforcement procedures apply when taxpayers fail to meet tax compliance requirements, regardless of physical presence or business structure. Remote sales through online marketplaces may trigger sales tax nexus under economic nexus law, requiring proper sales tax collection and remittance to avoid enforcement actions.
North Dakota Sales Tax Enforcement and Economic
Nexus
North Dakota enforces sales and use tax obligations on businesses with minimum contacts in the state, including remote sellers without physical presence. Following judicial decisions, including South Dakota v. Wayfair, in which the Supreme Court overturned Quill Corp. v. North
Dakota and the Bellas Hess rule, states gained the authority to require remote sellers to collect sales tax based on economic activity.
Businesses exceeding transaction thresholds must register for sales tax collection, file returns, and remit taxes to avoid enforcement actions and comply with the Streamlined Sales and Use
Tax Agreement requirements adopted by state and local governments.
Received a State Tax Notice?
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