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FAQ Articles

What is the passthrough withholding requirement?

A partnership, or a limited liability company filing as a partnership, is required to withhold North Dakota income tax for every nonresident partner whose distributive share of North Dakota income is $1,000.00 or greater. The partnership must withhold at the highest individual income tax rate from the year-end distributive share of North Dakota income of its nonresident partners whose distributive share of North Dakota income is $1,000 or greater.  For the tax years prior to 2014, the withholding requirement only applies to nonresident individuals.  Starting with the 2014 tax year, the definition of a "nonresident partner" for a passthrough entity withholding return purposes was expanded to include nonresident trusts, nonresident grantor trusts, and passthrough entities with a commercial domicile outside of North Dakota. The applicable rate for each year is set out in Form 58 and its instructions. The total withholding must be paid in full with the partnership return when it is filed.

nd.gov - The Official Portal for North Dakota State Government
North Dakota: Legendary. Follow the trail of legends

Ryan Rauschenberger
Tax Commissioner
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FAQ Articles

What is the passthrough withholding requirement?

A partnership, or a limited liability company filing as a partnership, is required to withhold North Dakota income tax for every nonresident partner whose distributive share of North Dakota income is $1,000.00 or greater. The partnership must withhold at the highest individual income tax rate from the year-end distributive share of North Dakota income of its nonresident partners whose distributive share of North Dakota income is $1,000 or greater.  For the tax years prior to 2014, the withholding requirement only applies to nonresident individuals.  Starting with the 2014 tax year, the definition of a "nonresident partner" for a passthrough entity withholding return purposes was expanded to include nonresident trusts, nonresident grantor trusts, and passthrough entities with a commercial domicile outside of North Dakota. The applicable rate for each year is set out in Form 58 and its instructions. The total withholding must be paid in full with the partnership return when it is filed.

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