How to File Your North Dakota Tax Return for 2019: Step-by-Step Guide for Individuals and Small Businesses

Filing your North Dakota state income tax return requires understanding specific requirements, deadlines, and procedures that directly impact your tax liability and potential refund. The 2019 tax year brought significant changes to North Dakota tax rates, deductions, and credits that affect how you calculate your taxable income and determine what you owe or expect to receive back. Whether you are an individual taxpayer, sole proprietor, or small business owner, understanding these requirements ensures you file accurately and take advantage of all available benefits.

This comprehensive guide covers everything US taxpayers need to know about completing their 2019 North Dakota state return, from determining filing requirements to tracking refunds. We will review the essential forms, step-by-step instructions for completing your return, electronic and paper filing options, and payment methods available through North Dakota's system. Understanding these processes helps you avoid common mistakes, meet critical deadlines, and ensure compliance with state tax regulations.

The 2019 tax year introduced several significant changes affecting your taxable income calculations, including new military retirement pay exclusions, social security benefit deductions, and enhanced tax credits. When completing your North Dakota state return, these changes require careful attention, as they can significantly impact your final tax liability. This guide provides the details you need to navigate these changes successfully and confidently file your return.

Overview of North Dakota State Income Tax for 2019

Who Needs to File

Full-Year Residents: North Dakota residents who lived in the state for the entire 2019 tax year must file a state return if required to file a federal return. The state uses your federal filing requirements as the foundation for determining North Dakota filing obligations, which simplifies the process for most taxpayers.
Part-Year Residents: Individuals who moved to or from North Dakota during 2019 must file a state return if they earned income while residing there, and they must file federal returns. Part-year residents calculate their North Dakota taxable income based on the portion of the year they lived in the state.
Nonresidents with North Dakota Income: Nonresidents who earned income from North Dakota sources must file a state return regardless of where they live, provided they meet federal filing requirements. This includes income from North Dakota employment, business operations, rental properties, or other state-sourced earnings contributing to your overall tax liability.

Key Income Thresholds for 2019

Individual Filing Requirements: North Dakota follows federal income thresholds, requiring single filers with gross income exceeding $12,200 to file returns. These thresholds determine whether you must file and pay North Dakota state tax on your taxable income, with rates ranging from 1.10% to 2.90% based on your income level.
Married Filing Status Requirements: Married couples filing jointly must file if their combined gross income exceeds $24,400, while those filing separately follow the $12,200 threshold for each spouse. Head of household filers must file when gross income exceeds $18,350, and a qualifying widow(er) status requires filing when income exceeds $24,400.
Connection to Federal Requirements: Your obligation to file a North Dakota state return directly connects to your federal filing requirements, meaning that if the IRS requires you to file, North Dakota generally requires a state return. This connection simplifies the process by eliminating separate state-specific income thresholds for most taxpayers.

Important Deadline

April 15, 2020, Filing Deadline: The 2019 North Dakota tax return and any balance due were required by April 15, 2020, to avoid late filing and payment penalties. Missing this deadline results in interest charges and penalties that increase your total tax liability, making timely filing essential for all taxpayers who qualify for extensions.
Extension and Payment Rules: While you can file for an extension to submit your paperwork, any taxes owed must still be paid by the original April 15 deadline to avoid penalties. Extensions provide additional time to complete and file your return but do not extend the payment deadline for taxes owed.

Key Changes from 2018 to 2019

Military Retirement Pay Exclusion: North Dakota introduced a new deduction for retirement benefits received by retired members of the US armed forces, reserves, Army National Guard, or Air National Guard. This change significantly reduces taxable income for eligible military retirees and provides substantial tax savings for qualifying family members who receive survivor benefits.
Social Security Benefits Deduction: Eligible individuals with adjusted gross income of $50,000 or less ($100,000 for married filing jointly) could deduct the taxable portion of their Social Security benefits from North Dakota taxable income. This change provided significant tax relief for qualifying retirees and disabled individuals receiving Social Security benefits.
Educational Reimbursement and Enhanced Credits: New deductions became available for employer reimbursements of higher education expenses included in federal taxable income, while enhanced tax credits were introduced for contributions to nonprofit private schools. These changes reflect North Dakota's support for education and workforce development initiatives.

What Forms to Use

Form ND-1 (Standard Individual Income Tax Return)

Comprehensive Tax Situations: Form ND-1 serves as the standard individual income tax return for North Dakota taxpayers with complex tax situations requiring detailed calculations. This form accommodates adjustments to income, itemized deductions, various tax credits, and multiple income sources that affect your final taxable income calculation.
Required for Specific Taxpayers: You must use Form ND-1 if you are a nonresident or part-year resident, have adjustments to income, itemize deductions, or claim tax credits beyond the standard options. This form provides the flexibility to correctly calculate the North Dakota state tax for complex financial situations.

Form ND-EZ (Simplified Individual Income Tax Return)

Streamlined Filing Option: Form ND-EZ offers a simplified filing option for full-year North Dakota residents with straightforward tax situations involving only wages, interest, and standard deductions. This form reduces complexity and filing time for taxpayers without making adjustments or claiming notable credits that would affect their taxable income calculations.
Eligibility Requirements: You can use Form ND-EZ only if you are a full-year resident taking the standard deduction, have no adjustments to income, do not claim tax credits, and do not owe estimated tax penalties. These restrictions ensure the form remains simple while correctly calculating your North Dakota state tax liability.

Standard Schedules and Additional Forms

Nonresident and Credit Schedules: Schedule ND-1NR calculates the portion of income taxable to North Dakota for nonresidents and part-year residents, while Schedule ND-1CR handles credits for income tax paid to other states. These schedules ensure proper income allocation and prevent double taxation when you pay taxes to multiple states during the same tax year.
Tax Credits and Payment Forms: Schedule ND-1TC reports various North Dakota tax credits, Schedule ND-1SA itemizes other income subtractions, and Forms ND-1PRV and ND-1V serve as payment vouchers for paper and electronic filings, respectively. These forms help you properly claim all eligible credits and make required payments to satisfy your North Dakota state tax obligations.

Step-by-Step Instructions to Complete Your Return

Before You Begin – Gather Required Documents

Federal Return and Income Documentation: Collect your completed 2019 federal income tax return along with all Forms W-2 from employers and Forms 1099 reporting interest, dividends, and other income sources. These documents provide the foundation for calculating your North Dakota taxable income and ensure accuracy when completing your state return.
State-Specific Documentation: Gather North Dakota Schedule K-1s showing state income tax withholding, records of estimated tax payments made during 2019, and documentation supporting any deductions or credits you plan to claim. Having these documents organized before you begin helps streamline the filing process and reduces the likelihood of errors.

Step 1: Choose the Correct Form

Form selection depends on your residency status and the complexity of your tax situation, directly affecting how you calculate your North Dakota state tax liability. Full-year residents with simple tax situations involving only wages, interest, and the standard deduction can use Form ND-EZ to simplify their filing process. However, suppose you need to make adjustments to income, itemize deductions, claim tax credits, or you are a nonresident or part-year resident. In that case, you must correctly use Form ND-1 to calculate your taxable income.

Step 2: Complete the Header Information

Enter your complete legal name, social security number, current mailing address, and filing status exactly as they appear on your federal return to ensure consistency between your federal and state filings. Include your school district code as specified in the instructions and any applicable income source codes that help North Dakota track its revenue. Accuracy in this section prevents processing delays and ensures your return is correctly credited to your account.

Step 3: Calculate Your North Dakota Taxable Income

Begin with your federal adjusted gross income from Form 1040, line 8b, and your federal taxable income from line 11b as the starting points for your North Dakota calculations. Add back certain items deducted federally but are taxable to North Dakota, such as lump-sum distributions and specific business losses. Then subtract items that are not taxable to North Dakota, including interest from US government obligations, railroad retirement benefits, and new 2019 deductions like military retirement pay exclusions and social security benefit deductions for eligible taxpayers.

Step 4: Calculate Your Tax

Use the North Dakota tax tables provided in the instructions to determine your tax liability based on your calculated North Dakota taxable income and filing status. The state applies tax rates ranging from 1.10% to 2.90% across five tax brackets, with higher income levels subject to higher rates. Locate your income range in the appropriate table and find the corresponding tax amount, which represents your base North Dakota state tax before applying any credits.

Step 5: Apply Credits

State Tax Credits: Calculate and apply eligible North Dakota tax credits using Schedule ND-1TC, including credits for income tax paid to other states, marriage penalty relief for joint filers, and other state-specific credits. These credits directly reduce your tax liability dollar-for-dollar, potentially resulting in significant savings that lower your total state tax obligation in North Dakota.
Credit Documentation: Ensure you have proper documentation to support any credits claimed, as the state may require verification during processing or future audits. Common credits include payments made to other states on the same income and credits for specific activities or contributions that North Dakota encourages through its tax policy.

Step 6: Calculate Payments, Refunds, or Balance Due

Enter all North Dakota income tax withheld from your W-2s, 1099s, and North Dakota Schedule K-1s, plus any estimated tax payments made during 2019, to determine your total payments. Compare your total payments to your net tax liability after credits to determine whether you are owed a refund or have a balance due. If your payments exceed your tax liability, you will receive a refund; if your tax liability exceeds your payments, you must pay the difference by the filing deadline.

Common Mistakes to Avoid

Documentation and Calculation Errors: Forgetting to attach your complete federal return, incorrectly entering withholding amounts from tax documents, or making arithmetic errors when using tax tables can delay processing and potentially result in incorrect tax calculations. Always double-check that withholding amounts match your W-2s and 1099s exactly, and verify all calculations using the provided tax tables.
Filing Status and Signature Issues: Your North Dakota filing status must match your federal return exactly, and both spouses must sign joint returns to validate the filing. Missing signatures, incorrect filing status, or failure to include estimated tax payments made during the year are common oversights that can cause processing delays and potential penalties.

How to File Your Return

Electronic Filing (E-File)

Advantages of Electronic Filing: E-filing your North Dakota return through the Federal/State e-file program provides faster processing, built-in error checking, secure, encrypted transmission, and immediate confirmation of receipt. Electronic returns are typically processed in about 30 days, significantly faster than paper returns, and the system automatically checks for common errors before submission.
Free and Paid E-Filing Options: North Dakota offers free e-filing options for eligible taxpayers through various online platforms and tax preparation software that support state returns. Many commercial tax preparation programs include North Dakota state returns in their basic packages, while qualified tax professionals can also e-file your return electronically.

Paper Filing

Required Attachments for Paper Returns: When filing by paper, you must attach a complete copy of your federal return, all W-2s and 1099s showing North Dakota withholding, any required schedules, and Form ND-1PRV payment voucher if you owe taxes. Mail all paper returns to the Office of State Tax Commissioner, PO Box 5621, Bismarck, ND 58506-5621, regardless of whether you owe money or expect a refund.
Paper Filing Considerations: Paper returns take longer to process than electronic filings and have higher error rates due to manual data entry by state personnel. Ensure all forms are completed in ink, both spouses sign joint returns, and you keep copies of all documents for your records before mailing your return to the state.

How to Make a Payment

Electronic Payment Options

North Dakota Taxpayer Access Point (ND TAP): The state's preferred payment method allows you to make electronic payments 24/7 using electronic checks (ACH transfers) at no charge or credit/debit cards with convenience fees charged by third-party processors. ND TAP provides immediate payment confirmation and integrates with your taxpayer account for easy tracking and management.
Payment Security and Convenience: Electronic payments provide better security than mailing checks, offer immediate confirmation, and eliminate the risk of lost or delayed mail delivery. The system accepts payments even after filing your return, making it convenient to pay any balance due or make estimated payments for future tax years.

Paper Payment Options

Check and Money Order Requirements: Make checks or money orders payable to "ND State Tax Commissioner" and include your social security number and "2019 ND-1PRV" in the memo line to ensure proper credit to your account. Use Form ND-1PRV payment voucher and mail payments to the same address as your tax return, providing the payment arrives by the filing deadline.
Payment Processing Considerations: Paper payments must be drawn on US or Canadian banks in US dollars using standard 9-digit routing numbers, and they take longer to process than electronic payments. Mail payments with sufficient time to reach the tax office by the deadline, as postmark dates may not always protect against late payment penalties.

Payment Deadlines and Penalties

April 15, 2020 Payment Deadline: All 2019 North Dakota tax payments were due by April 15, 2020, regardless of whether you filed for an extension to submit your paperwork. Late payments incur penalties and interest charges that compound daily from the original due date, significantly increasing your total tax liability.
Penalty and Interest Calculations: Late payment penalties typically equal a percentage of the unpaid tax amount per month, while interest compounds daily based on statutory rates set by the state. Even if you cannot pay the full amount owed, filing your return on time and paying as much as possible helps minimize these additional charges.

How to Track Your Refund or Balance Due

"Where's My Refund?" Tool

Online Refund Tracking: Access North Dakota's official "Where's My Refund?" tool through the state tax website to check your refund status, view the current processing stage, and determine if additional information is needed. The system requires your social security number, filing status, and expected refund amount for security verification before displaying your account information.
Refund Information and Updates: The tool provides real-time updates on your refund processing status, estimated timeline for completion, and alerts if your return requires additional review or documentation. This online system is available 24/7 and provides more detailed information than phone inquiries, which may have limited availability.

Processing Timeline

Electronic vs. Paper Processing: E-filed returns typically process within 30 days during regular periods, while paper returns may take significantly longer due to manual data entry and verification requirements. High-volume periods during tax season, missing information, mathematical errors, and returns requiring additional verification can extend processing times beyond normal expectations.
Factors Affecting Processing Speed: Returns with complex deductions, claims requiring verification, incomplete information, or mathematical errors may experience processing delays that extend beyond typical timeframes. Filing early in the tax season and ensuring accuracy in your return helps minimize potential delays and expedite your refund processing.

Checking Your Balance Due

ND TAP Account Management: Use the North Dakota Taxpayer Access Point online portal to view your current account balance, payment history, pending transactions, and upcoming payment due dates for any outstanding tax obligations. The system provides comprehensive account information and allows you to make payments, set up payment plans, and manage your taxpayer account online.

Final Filing Checklist

Complete all required forms and schedules – Fill out Form ND-1 or ND-EZ with accurate information. Attach any needed schedules, such as ND-1NR for nonresidents, ND-1CR for tax credits, or ND-1TC for other state-specific credits. These ensure your filing is complete and properly calculated.
Attach income documentation – Include all W-2s, 1099s, and North Dakota Schedule K-1s showing state withholding. These forms verify your reported income and tax payments.
Include supporting records for deductions and credits – Have documentation for each deduction or credit claimed, such as receipts, statements, or employer reimbursement records. This prevents delays if the state requests verification.
Double-check accuracy – Review all math using tax tables, confirm your filing status matches your federal return, and ensure Social Security numbers are correct for you, your spouse, and dependents. Accuracy avoids reprocessing or penalty notices.
Sign and date your return – Both spouses must sign if filing jointly. An unsigned return is considered incomplete and will not be processed.
Mail or submit to the correct address – Send all paper returns and payments to PO Box 5621, Bismarck, ND 58506-5621. Use Form ND-1PRV with any check or money order to ensure proper payment credit.
Select your refund method – Choose direct deposit for faster refunds or a paper check if preferred. Confirm banking information is correct to avoid delays.
Keep copies for your records – Store a complete copy of your return, attachments, and proof of payment for at least three years in case of questions, audits, or amendments.

Frequently Asked Questions

What if I missed the April 15, 2020, deadline?

If you missed the deadline, file your return immediately to minimize penalties and interest charges. You will likely owe late filing penalties of 5% per month up to 25%, late payment penalties of 0.5% per month, and daily compounding interest from the original due date. If you cannot pay immediately, filing your return helps minimize additional penalties.

Can I e-file my North Dakota return for free?

Yes, North Dakota offers free e-filing options for eligible taxpayers through various online platforms and the Free File Alliance program. Many commercial tax preparation software packages include North Dakota returns in their basic offerings, and some provide free state filing when you purchase federal return preparation services from qualified providers.

What deductions are most commonly missed on North Dakota returns?

Some deductions that people often forget about are the new military retirement pay exclusion, the deduction for social security benefits for those who qualify, contributions to college SAVE accounts, reimbursements for educational expenses from employers, interest from US government obligations, and exclusions for qualified dividends. Review all available deductions carefully to ensure you claim all benefits you qualify for.

How do I request a filing extension?

North Dakota automatically honors federal extensions, so no separate state form is required if you received a federal extension. However, the extension applies only to filing your return, not to paying taxes owed. You must still pay any estimated North Dakota tax liability by April 15 to avoid penalties and interest charges.

Can I file jointly if I moved to/from North Dakota during 2019?

Yes, married couples can generally file jointly regardless of when they moved during the year. However, part-year residents must file Schedule ND-1NR to allocate income between resident and nonresident periods properly. Different rules may apply to military personnel under the Servicemembers Civil Relief Act, so review your specific situation carefully.

What if my federal return is amended after I file my North Dakota return?

You must file an amended North Dakota return within 90 days if you amend your federal return or the IRS makes changes to your federal return. Submit a complete North Dakota return marked as "amended" to ensure proper processing and avoid potential penalties for underreporting income or overstating deductions on your original state filing.

How long should I keep my tax records?

Keep tax records for at least three years from the filing date, or until any tax owed is paid plus three years, whichever is later. If you file a claim for a refund, keep records for three years from filing or two years from the payment date. Best practice suggests maintaining records for at least six years to cover potential audit periods and statute of limitations issues.