North Dakota State Income Tax Withholding
Last Updated: January 2026
Overview
North Dakota imposes one of the lowest state income taxes in the nation, with a progressive structure that includes a 0% bracket for lower incomes. The state accepts the federal Form W-4 for withholding purposes, simplifying compliance for employers.
2026 Tax Rates
Single Filers
| Taxable Income | Rate |
|---|---|
| $0 - $44,725 | 0% |
| $44,726 - $225,975 | 1.95% |
| Over $225,975 | 2.50% |
Married Filing Jointly
| Taxable Income | Rate |
|---|---|
| $0 - $74,750 | 0% |
| $74,751 - $275,100 | 1.95% |
| Over $275,100 | 2.50% |
Note: The 0% bracket means many North Dakota taxpayers pay no state income tax at all.
Deductions and Exemptions
Standard Deduction: North Dakota conforms to federal amounts:
- Single: $14,600
- Married Filing Jointly: $29,200
- Head of Household: $21,900
North Dakota's withholding tables incorporate the standard deduction automatically.
Special Considerations
Federal Form W-4 Accepted
North Dakota accepts the federal Form W-4 for state withholding purposes. No separate state form is required.
Advantages:
- Simplified onboarding for new employees
- No separate state form to maintain
- Withholding tables aligned with federal W-4 design
Low Tax Burden
With a 0% bracket covering substantial income levels, many North Dakota workers have minimal or no state income tax liability. The maximum rate of 2.50% is among the lowest of states with an income tax.
Reciprocal Agreement
North Dakota has a reciprocal agreement with Minnesota.
Minnesota residents working in North Dakota:
- May claim exemption from North Dakota withholding
- Must file Form NDW-R (Reciprocity Exemption from Withholding)
- Are subject to Minnesota withholding instead
No Local Income Taxes
North Dakota does not permit local income taxes. Only state withholding is required.
Electronic Filing
Employers must file and pay electronically if:
- Required to file federal employment taxes electronically, OR
- Annual withholding exceeds $1,000
Oil and Gas Industry
North Dakota's energy sector may have specialized rules for certain compensation. Consult North Dakota Tax Commissioner guidance for industry-specific situations.