North Dakota Tax Guide 2025
Explore North Dakota's 2025 state tax rates for income, sales, property, retirement, and more. Learn how North Dakota compares nationwide.


North Dakota state tax: Overview
North Dakota does have a state income tax, but the rate is lower than in many other states, which can be a welcome break for residents. The state also keeps alcohol and tobacco taxes on the low side, which helps keep certain costs in check.
Property tax rates are about average, so homeowners are unlikely to face major surprises there. Combined with the relatively low income tax, these factors can make North Dakota’s overall tax burden feel a bit lighter than in many other parts of the country.
[Data for this state tax guide was gathered from several sources including the U.S. Census Bureau, the state’s government website, the Sales Tax Handbook, and the Tax Foundation. Property taxes are cited as a rate percentage rather than the assessed value.]
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.

Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
North Dakota income tax
North Dakota has a graduated state individual income tax rate ranging from 1.95 percent to 2.50 percent.
North Dakota retirement taxes
North Dakota tax on retirement benefits: North Dakota doesn't tax Social Security retirement benefits.
The state doesn't tax Military pensions or Railroad Retirement benefits, either.
- Tax on Taxable Income: Low of 0% (on up to $47,150 for single filers and $78,775 for joint filers) and a high of 2.5% (on more than $238,200 for single filers and $289,975 for joint filers)
- Social Security: Not taxable
- Pensions: Taxable (Excluding military retirement pay)
- 401(k) and IRA Distributions: Taxable
North Dakota sales tax
North Dakota's statewide sales tax is 5%. Localities can add up to 2.05%, but the average combined sales tax rate is 7.05%, according to the Tax Foundation.
- Groceries: Exempt
- Prescription drugs: Taxable
- Clothing: Taxable
How much are property taxes in North Dakota?
In North Dakota, the average effective property tax rate is 0.94%, which is reasonable when compared to property taxes in many other states.
North Dakota Property Tax Breaks for Retirees
North Dakota Homestead Tax Credit or Renter's Refund: Some state residents can receive a property tax credit or a partial refund of rent they pay. The homestead tax credit could reduce a property's taxable value by up to $9,000. Renter's refunds are worth up to $400. Homeowners and renters must meet one of the following criteria to qualify.
- Be 65 or older
- Have a permanent or total disability
North Dakota gas tax
Gasoline | $0.23 per gallon |
Diesel | $0.23 per gallon |
Source: Sales Tax Handbook
North Dakota alcohol and tobacco taxes
Product | Tax Amount |
---|---|
Cigarettes | $0.44 per pack |
Chew Tobacco and Snuff | $0.16-$0.60 per ounce |
Cigars and Tobacco | 28% of wholesale price |
Medical Marijuana | 5% |
Source: Sales Tax Handbook
Product | Tax Amount |
---|---|
Wine | $0.50 per gallon |
Beer | $0.16 per gallon |
Liquor | $2.50 per gallon |
Source: Sales Tax Handbook
Note: Alcohol in North Dakota is also subject to a 7% sales tax.
North Dakota estate and inheritance taxes
North Dakota is one of the many states with no estate or inheritance taxes.
Related Content
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

Katelyn has more than 6 years of experience working in tax and finance. While she specialized in tax content while working at Kiplinger from 2023 to 2024, Katelyn has also written for digital publications on topics including insurance, retirement, and financial planning and had financial advice commissioned by national print publications. She believes knowledge is the key to success and enjoys providing content that educates and informs.
-
Five Ways to Cash In On the $6,000 'Senior Bonus' Deduction
Taxpayers aged 65 and older may be able to benefit from a $6,000 'senior bonus' deduction over the next four tax years. Here are five ways to make it pay.
-
Are AI Search Results Ghosting Your LinkedIn Posts? This Could Be Why
Posts generated by AI don't hold enough authority with AI search engines to significantly boost your visibility (yes, that's ironic!). Here's what you can do instead.
-
Tax Brackets 2025 Quiz: How Much Do You Know?
Quiz Test your knowledge of IRS rules that impact how much money you keep in your wallet.
-
Retirees Face a Growing Capital Gains Tax Trap: What's Next?
Home Sales A changing housing market and unchanged IRS exclusion amounts can add up to a headache for many homeowners. Will Congress offer a fix?
-
New York Inflation Refund Checks Are Coming Soon: What to Know Now
Tax Relief Inflation relief checks are on the way for over 8 million New York taxpayers. Here's a full breakdown of who gets a payment and when you may expect yours.
-
IRS Paper Checks Deadline: What Happens After September 30?
Tax Changes Avoid delays when IRS tax refunds and Social Security paper checks are cut off. Here’s what to know.
-
The Most Tax-Friendly States for Investing in 2025 (Hint: There Are Two)
State Taxes Living in one of these places could lower your 2025 investment taxes — especially if you invest in real estate.
-
The Final Countdown for Retirees with Investment Income
Retirement Tax Don’t assume Social Security withholding is enough. Some retirement income may require a quarterly estimated tax payment by the September 15 deadline.
-
Standard Deduction 2025 Quiz: How Much Do You Really Know?
Quiz Test your knowledge of IRS rules that impact how much money you keep in your wallet.
-
IRS in Turmoil: GOP Budget Cuts and Staff Shake-Ups Threaten Taxpayer Services
IRS Republican lawmakers advance a controversial budget bill that would gut IRS funding further, risking your 2026 tax filing season.