§ 57-38-42 — Information at the source (Effective for taxable years beginning before January 1, 2022)

North Dakota § 57-38-42

• Jurisdiction: North Dakota
• Title 57: Taxation
• Ch. 57-38: Income Tax

Text

January 1, 2022)
Information as to income must be furnished at the source in the manner following:
1. Except for employers subject to sections 57-38-59 through 57-38-61, every person, a
resident of, or having ownership of property with a situs in, or carrying on a trade or
business in, this state, including officers and employees of this state or of any political
subdivision within this state, making payment of rents, compensation for personal or
professional services performed in this state, or other fixed or determinable annual or
periodical gains, profits, and income during the calendar year to any taxpayer shall
make a complete return thereof to the tax commissioner, in the form and manner
prescribed by the tax commissioner. This subsection applies only if an information
return for the same item is also required to be filed for federal income tax purposes.
Except for those payments from which state income tax was withheld, interest,
dividend, pension, and annuity payments are excluded from the reporting
requirements of this subsection; provided, if any person has withheld state income tax
from an interest, dividend, pension, or annuity payment, that person must be deemed
to be an employer for purposes of sections 57-38-59 through 57-38-61 and shall
comply with the requirements of those sections. For purposes of this subsection, the
tax commissioner is authorized to prescribe rules to specifically exclude items that are
otherwise required to be reported under this subsection from the reporting
requirements of this subsection if, in the tax commissioner's judgment, the reporting of
the items does not contribute to the effective administration of the state's income tax
laws.
2. Every partnership carrying on a trade or business in this state shall make a return,
stating specifically the items of its gross income and the deductions allowed by this
chapter, and shall include in the return the name, address, social security number or

federal identification number, whichever applies, and the amount of the distributive
share of each partner.
3. All information returns required under subsection 1 must be made on the basis of a
calendar year for payments made during the calendar year and must be filed with the
tax commissioner on or before the due date for filing similar returns with the internal
revenue service. All partnership returns required under subsection 2 must be made on
or before the fifteenth day of the fourth month following the close of the fiscal year of
the partnership required to make the return, or if the return is made on the basis of a
calendar year, then the return must be made on or before the fifteenth day of April in
the year following the calendar year for which such return is made.
4. Each information return required under subsection 1 must be deemed to be filed with
the tax commissioner if the person required to make the return files with the tax
commissioner a copy of the information return along with a copy of the transmittal form
required to be filed with the internal revenue service. Each partnership return required
under subsection 2 must be signed and must contain or be verified by a written
declaration that it is made under the penalties of perjury.
5. Each information return required under subsection 1 must be deemed to be filed with
the tax commissioner if the person required to make the return has filed an information
report on magnetic tape with the United States internal revenue service. All such
persons who have received permission from the United States internal revenue
service to file on magnetic tape must notify the tax commissioner, by letter, within thirty
days of obtaining such permission. This subsection is conditioned on the existence of
an agreement between the state of North Dakota and the United States internal
revenue service to participate in combined federal-state information reporting.
6. In case of failure to file an information at the source return as required by subsection 1
by the date prescribed in subsection 3, and after thirty days' notice to file is given by
the tax commissioner, the tax commissioner may assess a penalty of ten dollars for
each failure to file, not to exceed two thousand dollars. In case of failure to file a
partnership return as required by subsection 2 on the date prescribed in subsection 3,
and after thirty days' notice to file is given by the tax commissioner, the tax
commissioner may assess a penalty of five hundred dollars for each failure to file.
Information at the source. (Effective for taxable years beginning after December 31,
2021) Information as to income must be furnished at the source in the manner following:
1. Except for employers subject to sections 57-38-59 through 57-38-61, every person, a
resident of, or having ownership of property with a situs in, or carrying on a trade or
business in, this state, including officers and employees of this state or of any political
subdivision within this state, making payment of rents, compensation for personal or
professional services performed in this state, or other fixed or determinable annual or
periodical gains, profits, and income during the calendar year to any taxpayer shall
make a complete return thereof to the tax commissioner, in the form and manner
prescribed by the tax commissioner. This subsection applies only if an information
return for the same item is also required to be filed for federal income tax purposes.
Except for those payments from which state income tax was withheld, interest,
dividend, pension, and annuity payments are excluded from the reporting
requirements of this subsection; provided, if any person has withheld state income tax
from an interest, dividend, pension, or annuity payment, that person must be deemed
to be an employer for purposes of sections 57-38-59 through 57-38-61 and shall
comply with the requirements of those sections. For purposes of this subsection, the
tax commissioner is authorized to prescribe rules to specifically exclude items that are
otherwise required to be reported under this subsection from the reporting
requirements of this subsection if, in the tax commissioner's judgment, the reporting of
the items does not contribute to the effective administration of the state's income tax
laws.
2. Every partnership carrying on a trade or business in this state shall make a return,
stating specifically the items of its gross income and the deductions allowed by this
chapter, and shall include in the return the name, address, social security number or

federal identification number, whichever applies, and the amount of the distributive
share of each partner.
3. All information returns required under subsection 1 must be made on the basis of a
calendar year for payments made during the calendar year and must be filed with the
tax commissioner on or before the due date for filing similar returns with the internal
revenue service. All partnership returns required under subsection 2 must be made on
or before the fifteenth day of the fourth month following the close of the fiscal year of
the partnership required to make the return, or if the return is made on the basis of a
calendar year, then the return must be made on or before the fifteenth day of April in
the year following the calendar year for which such return is made.
4. Each information return required under subsection 1 must be deemed to be filed with
the tax commissioner if the person required to make the return files with the tax
commissioner a copy of the information return along with a copy of the transmittal form
required to be filed with the internal revenue service. Each partnership return required
under subsection 2 must be signed and must contain or be verified by a written
declaration that it is made under the penalties of perjury.
5. Each information return required under subsection 1 must be deemed to be filed with
the tax commissioner if the person required to make the return has filed an information
report on magnetic tape with the United States internal revenue service. All such
persons who have received permission from the United States internal revenue
service to file on magnetic tape must notify the tax commissioner, by letter, within thirty
days of obtaining such permission. This subsection is conditioned on the existence of
an agreement between the state of North Dakota and the United States internal
revenue service to participate in combined federal-state information reporting.
6. In case of failure to file an information at the source return as required by subsection 1
by the date prescribed in subsection 3, and after thirty days' notice to file is given by
the tax commissioner, the tax commissioner may assess a penalty of ten dollars for
each failure to file, not to exceed two thousand dollars. In case of failure to file a
partnership return as required by subsection 2 on the date prescribed in subsection 3,
and after thirty days' notice to file is given by the tax commissioner, the tax
commissioner may assess a penalty of five hundred dollars for each failure to file.
7. Any person required to file an information return under subsection 1, and any
passthrough entity with ten or more partners, shareholders, members, or owners shall
file the return by electronic data interchange or other electronic media as determined
by the tax commissioner. The tax commissioner may waive, upon a showing of good
cause, the requirement to file the return or pay the tax due electronically.