Tax Commissioner Releases Updated Income Tax Withholding Rates

BISMARCK, N.D. – Tax Commissioner Brian Kroshus released the updated North Dakota income tax withholding rates and instructions booklet for employers. The revised estimated tax forms for individuals, estates and trusts and fiduciary estimated payments were also released. The information reflects the reduction in income tax rates passed by the 2023 Legislature.

“The new withholding and estimated tax forms are a result of House Bill 1158, the bill that provides the largest individual income tax relief package in state history,” said Kroshus. “The bill allows everyday citizens, across all tax brackets, to keep more of their hard-earned money.”

HB 1158 will provide $358 million in individual income tax relief by zeroing out the state’s bottom tax bracket and combining the top four brackets into two brackets with reduced tax rates. The changes will result in an estimated $104 million in savings for the zeroed-out bottom bracket, $178 million in savings for the combined middle-income brackets and $76 million in savings for the combined top brackets over the next two years.

The updated North Dakota income tax withholding rates and instructions, individual estimated tax payment voucher (Form ND-1ES) and the estimated income tax for estates and trusts (Form 38-ES) can be found on the Office of State Tax Commissioner’s website.

Employers are not required to adjust the state withholding for paychecks issued after the release of the updated information. However, Kroshus encourages employers to use the revised withholding tables going forward for the remainder of 2023.

“Taxpayers making estimated tax payments may also adjust their payment amount based on the new reduced tax rates,” Kroshus said.

Taxpayers can stay up-to-date on North Dakota tax-related matters by visiting the Office of State Tax Commissioner’s website or by connecting on Facebook, Instagram, Twitter, LinkedIn and YouTube.