Property Tax Credits & Exemptions

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Property Generally Exempt from Taxation

All property owned exclusively by the US government, state of North Dakota, local government/political subdivision (including leasehold interest in property leased by a political subdivision from another political subdivision), or Tribal lands held in trust are exempt from taxation. This does not include lands contracted to be sold.

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)
 
Property Tax Exemptions- Application Required

Additional property may qualify for exemption, as listed in the qualifications, through the application process. 

Medium

Qualifications shown below, restrictions may apply and can be found in N.D.C.C. § 57-02-08:

  • Burial grounds or cemeteries
  • Cooperative and/or non-profit organization property used for one of the following primary purposes:
    • Furnish Potable water to members or customers, other than the irrigation of agricultural land
    • Promoting athletic and educational needs for a state educational institution
  • Daycare centers for both adult day care and early childhood services provided by a corporation, LLC or organization licensed under chapter 50-11.1.
  • Disability Exemptions, including persons:
    • Group homes owned by non-profit organizations with the purpose of caring for persons with developmental disabilities
    • Legally Blind, exemption cap on taxable valuation applies
    • Paraplegic Disabled Veteran, including unremarried surviving spouse
    • Paraplegic Disabled person, including unremarried surviving spouse, income restrictions apply
    • Permanently and totally disabled person confined to a wheelchair
  • Educational Institutions, including schools, academies, colleges and other institutions of learning. This also includes dormitories or boarding halls that are not for profit.
  • Farm structures on agricultural lands owned and operated by a farmer as defined in N.D.C.C. § 57-02-08
  • Leased Property in the instances of:
    • Property leased to the state for the purpose of public works, including sewage systems and water distribution systems
    • Property owned by religious organization for a minimum of five years used for an educational purpose by a school district
    • Property owned by non-profit institutions of public charity, including public hospitals and nursing homes licensed pursuant to section 23-16-01 under the control of religious or charitable institutions used for an educational purpose by a school district
    • Property owned by a political subdivision and leased to a nonprofit organization for the purpose of promoting public athletic or recreational activities
  • Lodges, Chapter, Associations that are not-for-profit and used exclusively for meeting or conducting business. Includes agricultural fair associations that are not for profit.
  • Military or Military organization property- used for armory and/or honorary monuments
  • New construction on single-family, townhome and condominiums for the first two taxable years on up to $150,000 of true and full value of the property with approval by resolution of the governing body in which the property resides
  • Parking structures/ramps used for general public patronage
  • Pollution Abatement improvements
  • Public Charity- Buildings and land belonging to institutions of public charity, including public hospitals and nursing homes licensed pursuant to section 23-16-01 under the control of religious or charitable institutions
  • Religious organizations- property used predominantly for current or future religious purposes
  • Rental Property that has been determined affordable housing by the housing finance agency, complying with requirements as listed in N.D.C.C. § 57-02-08(43) 

Certain exemptions have valuation or term limit caps. Refer to N.D.C.C. § 57-02-08 for more information. 

Application for Property Tax Exemption must be filled out annually and provided to the local assessor by February 1st of the year for which is the exemption is claimed. Application for Property Tax Exemption

Once application is approved exemption will be applied.

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Property Tax Exemptions- Special Application Required

Additional property may qualify for exemption, as listed in the qualifications, through their specific application process. 

Medium

Business Property Tax Exemptions

North Dakota offers the following property tax exemptions for businesses. 

Business Property Tax Exemptions
Medium

A business project may qualify for a property tax exemption for up to 5 years. 

Two extensions are available:

  • Agricultural processors may be granted a partial or full exemption for up to 5 additional years.
  • A project located on property leased from a government entity qualifies for an exemption for up to 5 additional years upon annual application by the project operator.

In addition to, or instead of, an exemption, local governments and any project operator may negotiate payments in lieu of property tax for a period of up to 20 years from the date project operations begin. 

Guideline - Property Tax Incentives for New or Expanding Business

Eligibility: Projects must be a new or expanding primary sector business. Primary sector is a business that adds value to product, process, or service that produces new wealth in North Dakota. Primary sector certification must be gained from the North Dakota Department of Commerce Division of Economic Development and Finance.

A project is not eligible for an exemption if any of the following apply:

  • A tax exemption was received under tax increment financing
  • The exemption fosters unfair competition or endangers existing business
  • Land does not qualify for an exemption

A city or county with a population of less than 40,000 may grant an exemption for a retail project (non-primary sector) if the voters have approved the granting of exemptions and criteria for retail sector projects.

Application Process:
  • Application for Property Tax Exemption for New or Expanding Businesses - North Dakota Department of Commerce Division of Economic Development and Finance
  • Primary Sector Certification – North Dakota Department of Commerce Division of Economic Development and Finance
  • One of the following Clearance Forms may be needed:
  • Apply to the city or county the project is located in. The application for exemption must be made and approved before construction of a new structure begins. If an existing structure will be occupied, application must be made and approved before the structure is occupied. Payments in lieu of taxes may be approved after construction or occupancy of a structure.
  • Project must publish 2 notices in the official newspaper of the city or county at least 1 week apart if it is determined there are local competitors. The last notice must be published at least 15 days, but not more than 30 days, before the application is considered.
  • A public hearing on the application must be held, after which the governing body acts on the application.

Century Code Reference: N.D.C.C. § 40-57.1

North Dakota exempts all personal property from property taxation except that of certain oil and gas refineries and utilities.

Century Code Reference: N.D.C.C. §§ 57-02-04 and 57-02-08

A property tax reduction applies to a centrally assessed wind turbine electric generation unit with a nameplate generation capacity of 100 kilowatts or more. A centrally assessed wind turbine electric generation unit produces electric power for public use.

Eligibility: A wind turbine on which construction is completed before January 1, 2015. The taxable value is calculated at 3% of assessed value instead of at the 10% rate that applies to other centrally assessed property. The taxable value is calculated at 1.5% of assessed value if:

  • Construction of the wind turbine is completed after June 30, 2006, and before January 1, 2015, or
  • A purchased power agreement was executed after April 30, 2005, and before January 1, 2006, and the construction of the wind turbine was completed after April 30, 2005, and before July 1, 2006. The valuation calculated at 1½% of assessed value only applies for the duration of the purchased power agreement initially executed for the wind turbine.

Century Code Reference: N.D.C.C. § 57-06

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Individual Property Tax Credits

North Dakota offers the following property tax credits for individuals. 

Medium

North Dakota residents who own a home and reside in it as their primary residence qualify for a state property tax credit. 

Learn more at: 

Primary Residence Property Tax Credit 

The Homestead Property Tax Credit is available for qualifying homeowners. 

Learn more at: 

Homestead Property Tax Credit

Certain individuals may qualify for a partial refund of the rent they pay.

Learn more at: 

Renter's Refund

The Disabled Veteran’s Property Tax Credit is available to veterans of the United States Armed Forces with a disability of 50% or greater.

If eligible, the credit may reduce the taxable value of a homestead. A homestead can include a house, the land the house is on, and/or other buildings on the same land. If a qualified veteran moves to a different homestead, the credit can be applied to the new property.

Learn more at: 

Disabled Veteran’s Property Tax Credit 

In North Dakota, there is a property tax exemption for qualifying farm residences. Each residence is examined individually to determine if it qualifies.

Learn more at:

Farm Residence Exemption

 

 

The below are forms you may need to submit to your local official for consideration.