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.
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 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
North Dakota residents who own a home and reside in it as their primary residence qualify for a state property tax credit.
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Certain individuals may qualify for a property tax credit or partial refund of the rent they pay.
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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.
Eligibility: To be eligible for this program, you must:
- Be a disabled veteran of the United States Armed Forces with an armed forces service-connected disability of 50% or greater in the year for which the application is made.
- Your extra-scheduler rating, to include individual unemployability, may bring the total disability rating to 100%, as determined by the United States Department of Veterans Affairs.
- Have received an honorable discharge or be retired from the United States Armed Forces.
- Reside on and be invested in the property.
If two disabled veterans are married and living together, the combined credits may not exceed 100% of $8,100 of taxable value of the homestead. In the event of the applicant’s death, the spouse is eligible for the credit. The spouse who is receiving United States Department of Veterans Affairs dependency and indemnity compensation receives 100% of the credit.
With the credit, the applicant’s taxable value may decrease as follows:
|Disability Percentage||Maximum Reduction|
Application Process: To apply for the Disabled Veteran's Property Tax Credit, submit:
- Application for Disabled Veterans Property Tax Credit to the local assessor or county director of tax equalization.
The application is due by February 1 of the year in which the property is assessed and for which the credit is requested. Include documentation regarding the applicant’s service-connected disability and military honorable discharge with your application.
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In North Dakota, there is a property tax exemption for qualifying farm residences. Each residence is examined individually to determine if it qualifies.
Eligibility: The general requirements for a qualifying farm residence include:
- The residence must be located on 10 acres or more of agricultural land and occupied by a farmer, which is a person who:
- Devotes most of their time to farming or ranching activities;
- Has had net farm income that is at least 66% of the total annual income of the farmer and spouse in any 1 year of the 2 preceding calendar years, whether one or both are farmers.
Individuals who have begun occupancy and operation of a farm within the last 2 calendar years qualify as a farmer, as well as any farmer who retired due to age or illness.
Application Process: To apply, complete the Application for Farm Residence Property Tax Exemption and contact the county director of tax equalization in the county where the residence is located. The complete application should be given to the county director of tax equalization.
Q: I am a farmer, yet my house is taxed. What are the requirements for an exemption of farm residence?
A: There is a specific exemption from property tax for a qualifying farm residence. Each residence must be examined individually to determine if it qualifies. One should contact the county director of tax equalization of the county where the residence is located to review the specific facts of the residence. The general requirements are as follows:
- Residence must be located on ten acres or more of agricultural land and occupied by a farmer.
- A farmer is a person who devotes the majority of time to farming or ranching activities; has had gross farm income that is at least 66 percent of the total annual income of the farmer and spouse in any one year of the two preceding calendar years.
- The term farmer includes a retired farmer who has retired because of age or illness and who, at the time of retirement, qualified as a farmer for the farm residence exemption. "Farmer" includes a beginning farmer who has begun occupancy and operation of a farm within the preceding three calendar years.
Flowcharts are available for those uncertain if they qualify for the exemption.
If you think you may qualify for the farm residence exemption, complete the Application for Farm Residence Exemption and contact the county director of tax equalization in the county where the residence is located.
The below are forms you may need to submit to your local official for consideration.
- Application for Abatement - Request for abatement or refund of taxes on property.
- Learn more about the Property Tax Assessment Process.
- Application For Classification as Inundated Agricultural Land - Request for classification of inundated agricultural land.
- Application for Property Tax Exemption - Request for consideration of a real property exemption.
- Application For Property Tax Exemption For Improvements To Commercial And Residential Buildings - Request for exemption of improvements on commercial or residential property valuation.
- Application For Exemption Of Solar, Wind, or Geothermal Devices - Request for exemption of any of these used to provide heating, cooling or electrical power.