§ 57-40.2-14 — Contractor's performance bonds for payment of use tax

North Dakota § 57-40.2-14

• Jurisdiction: North Dakota
• Title 57: Taxation
• Ch. 57-40.2: Use Tax

Text

For the purposes of this section, the term "contractor" includes any person or group or
combination of persons acting as a unit; "subcontractor" includes a person or group or
combination of persons acting as a unit, who undertakes to perform all or any part of work
covered by the original contract entered into by the contractor, including the furnishing of any
supplies, materials, equipment, or any other tangible personal property; "surety" means a bond
or undertaking executed by a surety company authorized to do business in this state; and
"surety company" means any person executing the surety.
Whenever any contractor or subcontractor enters into any contract for the erection of
buildings or the alteration, improvement, or repair of real property in this state and the contractor
or subcontractor furnishes surety for the faithful performance of such contract, there is hereby
imposed the additional obligation upon the surety company to the state of North Dakota that
said contractor or subcontractor shall promptly pay all use taxes which may accrue to the state
of North Dakota under this chapter. In the case of a contractor and the contractor's surety
company, this additional obligation shall include liability to pay to the commissioner on
purchases made by either the contractor or the subcontractor all such use taxes which have not
been paid to a retailer authorized or required to collect such taxes; and the contractor or the
contractor's surety company may recover from the subcontractor the amount of any use taxes
accruing with respect to purchases made by the subcontractor which the contractor or the
surety company may be required to pay to the commissioner, or to withhold from the amount
due the subcontractor under the subcontract an amount equal to any use taxes accruing with
respect to purchases of the subcontractor which have not been paid by the subcontractor to the
commissioner or to a retailer authorized or required to collect such taxes. Such liability on the
part of the surety company is limited to three percent of the amount of the contract price.
The surety company within sixty days after executing such surety shall send written notice
of the same to the commissioner, which notice must give the names and addresses of the
parties contracting with respect to the real property and the place where the contract is to be
performed. After the completion of the contract and the acceptance of the improvement by the
owner of the real property improved, the surety company shall give written notice of such
completion and acceptance to the commissioner.
Six months after the completion of the contract and the acceptance of the improvement by
the owner thereof, the additional obligation imposed upon the surety company ceases unless
written notice, within such period of time, of unpaid use taxes, is given to the surety company by
the commissioner.
This section does not modify or repeal any provision of chapter 48-01.2.
57-40.2-15. Penalties - Offenses.
1. a. Any person failing to file a return or corrected return or to pay any tax imposed
under this chapter, within the time required by this chapter, is subject to interest of
one percent of the tax for each month or fraction of a month except the first
month after the return or the tax became due.
b. In addition to the tax and interest prescribed in this chapter, a taxpayer is subject
to penalties as follows:
(1) If any taxpayer, without intent to evade any tax imposed by this chapter, fails
to file a return, on or before the prescribed or extended due date, a penalty
equal to five percent of the tax required to be reported, or five dollars,
whichever is greater, must be added if the failure is for not more than one
month, counting each fraction of a month as an entire month, with an
additional five percent for each additional month or fraction of a month
during which the failure continues, not exceeding twenty-five percent in the
aggregate.

(2) If any taxpayer, without intent to evade any tax imposed by this chapter, fails
to pay the amount shown as tax due on any return, filed on or before the
prescribed or extended due date, a penalty of five percent of the tax due, or
five dollars, whichever is greater, must be added to the tax.
(3) If upon audit of a taxpayer's return an additional tax is found to be due,
penalty as prescribed in subdivision a or b must be added to the tax.
(4) The commissioner, if satisfied that the delay was excusable, may waive, and
if paid, refund all or any part of the penalty and interest. The penalty and
interest must be paid to the commissioner and disposed of in the same
manner as the tax with respect to which it is attached. Unpaid penalties and
interest may be enforced in the same manner as is the tax.
2. Repealed by S.L. 1975, ch. 106, § 673.
3. The certificate of the commissioner to the effect that a tax has not been paid, that a
return has not been filed, or that information has not been supplied pursuant to the
provisions of this chapter is prima facie evidence thereof.
4. Any person failing to comply with any of the provisions of this chapter, or failing to
remit within the time herein provided to the state the tax due on any sale or purchase
of tangible personal property subject to the tax imposed under the provisions of this
chapter, is guilty of a class A misdemeanor.