SPOTLIGHT PROGRAMS

Property Tax Exemptions: A new or expanding, primary sector businesses may be granted a property tax exemption for up to 5 years. Certain business may negotiate with local authorities for a PILOT (payment in lieu of taxes) for up to 20 years. Personal property is exempt from taxation.

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‍Renaissance Zones: Businesses locating in any of the state’s designated Renaissance Zones are eligible to receive state income and local property tax exemptions for zone projects, as well as historical tax credits, available to approved zone projects.

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TAX CREDITS

Agricultural Commodity Processing Facility Investment Tax Credit: Income tax credit equal to 30% of investment in an agricultural commodity processing facility in North Dakota. No more than $50,000 of the allowable tax credit may be used per tax year and there is a $250,000 tax credit limit for all tax years.  An agricultural commodity processing facility includes a livestock feeding, handling, milking, or holding operation that uses a by-product manufactured at biofuel production facilities.

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Research Expense Credit:  Eligible businesses may qualify for a corporate income tax credit based on qualified research expenditures made in the State. For expenditures above the base amount, the credit is equal to 25% of the first $100,000 of qualified research expenses (QRE) and 8% for the additional expenses over $100,000. A taxpayer may elect to use an alternative way to calculate the credit; the credit is equal to 17.5% of the first $100,000 of excess QRE plus 5.6% of the excess QRE over $100,000. Unused tax credits may be carried back up to three years or carried forward up to fifteen years. Certain business may be eligible for transfer up to $100,000 of unused credits to another eligible business.

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Workforce Recruitment Credit: Eligible businesses may qualify for a one-time tax credit equal to 5% of salary of qualified recruited position. Unused credits can be carried forward for up to 4 years. Businesses must pay an average annual salary of at least 125% of North Dakota’s average wage and employ specific recruitment methods to be eligible for the credit.

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TAX EXEMPTIONS

Sales and Use Tax Exemptions: Electrical generating facilities, agricultural commodity processing facilities, manufacturing facilities, primary sector businesses (computer and telecommunication equipment), gas processing facilities, coal mining facilities, and oil refineries are exempt from sales and use tax for equipment and materials.

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Income Tax Exemptions: Certified primary businesses or tourism businesses may qualify for an income tax exemption for up to 5 years.

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DIRECT FINANCIAL ASSISTANCE

There are a variety of low interest financing and grant options available through: the Division of Community Services, the Agricultural Products Utilization Commission, the North Dakota Public Finance Authority, The North Dakota Development Fund, and The Bank of North Dakota.

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JOB TRAINING

North Dakota New Jobs Training Program: The state provides a variety of training programs in the form of loans and grants.  Loans are repaid in whole or in part through state income tax withholding credits from new employees.  The state also assists firms in recruiting, screening, and testing potential trainees.

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Last Updated: May 2023