Buildings not located on the same parcel as a residence and not used in connection with a residence are classified as commercial property.
An apartment building or other building with four or more separate family living units, retail buildings, shop condos, hotels, vacant lots, and any building that is not exempt as a farm building is classified as commercial property.
When assessing commercial property, the assessor uses all three approaches to value, the sales comparison approach, the cost approach, and the income approach.
Tax Rate
For locally assessed commercial property, the amount of the tax is usually determined by assessing the market value of the property and applying a specific tax rate, known as the millage rate. A mill is 0.1% or 1/10 of a percent, in order to calculate you take 0.001 times your taxable value and multiply that by your total mills to identify your total tax owed. Taxable value is calculated at 5% for commercial property.
For example, let's identify the property tax for a business located in a commercial property valued at $750,000 (true and full value) located where your local taxing entities total 250 mills.
- Residential True and Full Value x 5%= Taxable Value. ($750,000 x .05 = $37,500)
- Taxable Value x mill = Value of a Mill. ($37,500 x .001= $37.50)
- Value of a mill x # of taxable mills= Total Tax Owed. ($37.50 x 250 = $9,375)
The total tax owed a commercial property worth $750,000 with a 250 mill levy would be $9,375.
How to Appeal
To file a property tax appeal, please contact our Property Tax division by email at propertytax@nd.gov or call 701-328-3127. When you file an appeal, you will need to complete a questionnaire and submit other evidence.
More information is available in the Property Tax Assessment Process handout.
Tax Incentives
North Dakota offers the following property tax exemptions to businesses:
- New or Expanding Businesses
- Personal property is exempt from property taxation except in the following circumstances:
- Personal Property of Entities, other than railroads
- Property subject to tax in lieu of ad valorem taxes (Example: certain oil and gas refineries and utilities)
- Particular kinds or classes of personal property in which tax is imposed by another provision of law. (Example: Mobile homes and house trailers)
Payment Options
Property tax is a cumulation of different taxing entities and authorities. These various forms of local government include your county, city, township, school board, park board and any other entity that is authorized to levy property taxes. Although property taxes are payable to the county in which you reside, it is important to note that the funds are distributed as shown in the mill levy breakout on your statement. To contact your local county officials, please refer to the North Dakota Association of Counties website directory.