Income Tax Withholding Frequently Asked Questions
A: Any employer who currently files income tax withholding returns is eligible to voluntarily file using one of the electronic filing options.
A: Payroll service providers that (1) contract with an employer to file and pay the federal and state withholding taxes on behalf of the employer and (2) file and pay the employer’s federal withholding taxes electronically. A payroll service provider means a person that, for federal tax purposes, electronically processes and transmits an employer’s withholding returns and taxes including wage information returns. Check our web site for additional information at www.nd.gov/tax/indwithhold/elecfiling/
Information on Form W-2, 1099, 1042-S, or W-2G must be filed electronically if both of the following apply:
- There is a requirement to file the information electronically for federal purposes; and
- The quantity of returns required to be filed with North Dakota is 250 or more.
For additional information see our Information Return Guideline.
A: ACH Debit: The income tax withholding return is submitted over the internet and payment is made through an ACH Debit transaction. Under this payment method, the employer authorizes the State of North Dakota to electronically transfer the payment from the employer’s bank account to the State’s bank account. In addition, under this method, the Office of State Tax commissioner pays all associated bank fees.
ACH Credit: The employer instructs its bank to make an ACH Credit payment to the Office of State Tax Commissioner with sufficient information to identify the payment as an income tax withholding return. (Addenda Layout provided at the time of registration). The ACH Credit acts as the return (nothing else needs to be filed or sent to our office).
A: Below the login and password box is a link to Service Desk. Click on the link to send an e-mail explaining your situation. Remember, for security reasons the login and password is case sensitive and must be entered exactly as you registered.
A: Please complete the following steps to cancel your WebFile registration:
- Log into the WebFile system.
- On the Main Menu, select View Authorized Users.
- In the Action column, click on Remove. (Important Note: if there is more than one user, you must remove all other users before you remove your own user name.)
- On the Remove Authorized Users page, click the Remove button.
When you click on the Remove button for the last user, you will no longer be registered for WebFile and you will be returned to the Login ID page.
A: Employers may submit information returns using the following options:
- Key W-2 information by using the Withholding W-2 Online Entry option on our web site;
- Upload a file with W-2 or 1099 information by using our upload system on our web site;
- Direct submission of electronic media, such as a CD, by mail; or
- E-mail with a text file attachment to our e-mail address email@example.com.
See our web site for instructions at www.nd.gov/tax/indwithhold/elecfiling/.
If you file electronically by using any of the above methods, Form 307 Transmittal of Wage and Tax Statement is not required and should not be submitted.
A: Registration is a three-step process:
- Obtain a North Dakota Login ID.
- Register to obtain an authorization code.
- Complete registration by entering the account number and authorization code. Instructions to register can be found at www.nd.gov/tax/indwithhold/elecfiling/onlineentryguideline.pdf.
Note: If you are already registered to file your quarterly or annual Form 306 via Withholding WebFile, you already have access to W-2 Online Entry using your same login ID and password.
A: The following are reasons why you should use the W-2 Online Entry option to submit W-2 information:
- It is available 24 hours a day, 7 days a week;
- There is no paper to shuffle, no postage to pay, and no mail delays to worry about;
- Filing online is easier and more efficient than paper;
- Once registered, you can key W-2’s for multiple accounts without additional registration requirements;
- If registered for W-2 Online Entry, you also have access to upload your W-2’s using the W-2/1099 Upload Program;
- Secure Sockets Layer (SSL encryption technology is used to ensure your information is secure and protected; and
- If W-2 information is submitted electronically, Form 307 Transmittal of Wage and Tax Statement is not required to be mailed.
A: A North Dakota quarterly withholding return (Form 306) is mailed to every registered employer before the end of the calendar quarter for which it is due. If you do not receive your quarterly return by the end of the calendar quarter, you can print a blank copy of the Form 306 online, or you may contact the North Dakota Office of State Tax Commissioner to obtain another one.
Q: What do I do if I filed my monthly, quarterly, or annual state income tax withholding return with the wrong amount?
Paper filers: You may contact the Office of State Tax Commissioner for an amended Form 306 return or obtain a blank copy of Form 306 on our web site. Fill in the circle on the upper left corner of the page indicating it is an amended return along with your account number, period ending, due date and employer name and address. Enter the correct amount of withholding in Line 1. If you owe additional tax, include a check for the additional amount of tax due. If you overpaid, a refund will be issued.
ACH Debit: Web filers can edit the return on the same day the return was submitted. After that you will need to contact our office for a paper amended return to be mailed to report the correct amount or download Form 306 from our web site. See above instructions for paper filers.
ACH Credit: If you owe additional tax, please send another ACH credit transaction for the appropriate period. If you overpaid your return, you must submit a paper amended return to get a refund. Contact our office for an amended return or download the Form 306 from our web site. See above instructions for paper filers.
Call the Income Tax Withholding Section at 701.328.1248 if you would like an amended return mailed.
A: Form 307 is mailed to all employers registered to withhold North Dakota state income tax from wages or other payments and to employers that are not required to register but have previously submitted information returns as required by law.
Form 307 is required to be submitted with all paper copies of W-2’s and any paper copies of 1099’s that have North Dakota state income tax withheld on them.
If you file W-2 information electronically, a Form 307 is not required and should not be submitted.
A: If you voluntarily withhold North Dakota state income tax on 1099 income you must send a copy of the Federal Form 1099 along with Form 307 Transmittal of Wage and Tax Statement to our office. You may also submit them electronically. See our Information Return Guideline for further information.
- If you have an active withholding account but do not have any 1099’s with state income tax withheld to submit, you would file Form 307 as required to report zero. Send Form 307 separately from any 1099’s that have no state tax withheld on them.
- If you do not have an active withholding account there is no transmittal form to submit copies of 1099’s to North Dakota. You would just send copies of the 1099’s to our office.
North Dakota requires copies of all 1099’s except for interest, dividends, pensions or annuities unless you withhold state income tax on them.
A: Paper Form W-2 information and Form 307 (if required) and 1099’s are required to be submitted on or before February 28 following the end of the calendar year in which the income was paid. If you file electronically, the due date is extended to March 31. If the due date falls on a Saturday, Sunday, or legal holiday, the due date is extended to the next business day.
A: W-2 corrections should be made using Federal Form W-2C. Instructions can be found on the Social Security Administration web site at www.socialsecurity.gov/employer/w2cinfo.htm. Paper forms can be obtained by calling the Internal Revenue Service at 1-800-829-3676. A paper copy of Federal Form W-2C should be submitted with the state Form 307 to the Office of State Tax Commissioner.
1099 corrections with state income tax withheld should be submitted with the box marked “C-corrected” along with the state Form 307 to the Office of State Tax Commissioner. For 1099 corrections on which no North Dakota income tax was withheld, simply mail a copy of the corrected 1099 to the Office of State Tax Commissioner.
A: For North Dakota income tax withholding purposes, your employer's state ID number is the same as your federal employer's identification number assigned to you by the Internal Revenue Service with a two-digit suffix (e.g.,"01") added at the end of it. For example, if your federal employer's identification number is 45-9999999, your employer's state ID number will be 459999999-01 for North Dakota income tax withholding purposes.
A: 2001 North Dakota legislation replaced the short form method and tax rate for individuals with a new income tax system. Created by the Income Tax Revision Act of 2001 (HB 1399), the new system was put into place to prevent a state revenue shortfall that would result from the federal income tax rate cuts. A change in the North Dakota income tax withholding rate is effective beginning January 1, 2002. North Dakota income tax law authorizes the Tax Commissioner to determine the method and rate for calculating the amount of the North Dakota income tax to withhold from an employee's wages.
The amount of North Dakota income tax to withhold can be determined using one of three methods. Detailed information on the three methods is contained in a separate publication, North Dakota Income Tax Withholding Rates and Instructions for Wages Paid, and Withholding Tables.
A: No. North Dakota does not have a form comparable to the Federal Form W-4. The information on the Federal Form W-4 is also used for North Dakota income tax withholding purposes. If an employee claims exempt status on Federal Form W-4, the exempt status is recognized for North Dakota income tax withholding purposes. If an employer is required to submit a copy of Federal Form W-4 to the Internal Revenue Service, the employer must also submit a copy of the Federal Form W-4 to the Office of State Tax Commissioner.
A: In general, federal tax law requires employers to provide a Form W-2 to each employee at the end of each calendar year. Employers must give or mail the W-2s to employees no later than January 31 following the end of the calendar year. If you do not receive your W-2, you should do the following:
First, contact your employer to find out if the W-2s have been prepared and issued. If your employer mailed the W-2s, you may not have received your W-2 because of an incorrect or incomplete address. There may also be other reasons for not receiving your W-2 that may be easily taken care of by contacting the employer. After contacting your employer, allow a reasonable amount of time for your employer to issue or remail the W-2.
Second, if you still do not receive your W-2 after contacting your employer, contact the Internal Revenue Service (IRS) by calling 1-800-829-1040, but do not contact the IRS before February 16. Before you call the IRS, write down the following information which the IRS will ask you to provide:
- Your employer's name and complete address, employer identification number (if known), and telephone number;
- Your name, address, social security number, and telephone number; and
- An estimate of the wages paid to you by the employer, the federal income tax withheld, and the period of time you worked for the employer during the year.
You will need to give this information to the IRS so that they can prepare a Form 4852, Substitute For A Missing Form W-2. The IRS will mail a copy of Form 4852 to you. You should use the Form 4852 instead of your W-2 only if necessary to file your federal income tax return on time. Note that the use of a Form 4852 instead of the actual W-2 may delay your federal income tax refund while the information on the Form 4852 is verified by the IRS.
The information on the Form 4852 will be accepted for North Dakota income tax purposes. You should make a copy of the Form 4852 received from the IRS to attach to your North Dakota income tax return. Be sure to keep a copy of Form 4852 for your own records.
A: For walk-in assistance or written correspondence:
Withholding Tax Section
Office of State Tax Commissioner
600 E Boulevard Ave
Bismarck ND 58505-0599
Office Hours: 8:00 a.m. – 5:00 p.m. Central Time, Mon. – Fri., excluding holidays
Speech or hearing impaired Relay North Dakota 800.366.6888 (ask for 701.328.1248).