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Military Service members Guideline
Your North Dakota gross income is used only to determine if you have to file a North Dakota income tax return; only the
portion of your gross income included in your federal taxable income is included in your North Dakota taxable income. If
you are required to file a North Dakota income tax return, you must also complete Schedule ND-1NR and attach it to your
return. In calculating your North Dakota taxable income, you may deduct your federal active duty compensation received
during the time you were domiciled outside North Dakota.
Deductions Available To Service members
National Guard or Reserve service members
If you are a National Guard or Reserve service member domiciled in North Dakota who is mobilized for federal active
duty, you are allowed to deduct your federal active duty compensation in calculating your North Dakota taxable income.
However, no deduction is allowed for the portion of your federal active duty compensation that is combat pay exempted
from federal income tax, or that is received for basic military training, annual training, or professional military or
developmental education.
U.S. armed forces service members domiciled outside North Dakota
If you are a service member who is domiciled outside North Dakota, and if you are required to file a North Dakota income
tax return, you are allowed to deduct your federal active duty compensation in calculating your North Dakota taxable
income. However, no deduction is allowed for the portion of your federal active duty compensation that is exempted from
federal income tax, such as combat pay.
Military retirement pay deduction
For tax years 2019 and after, military retirement benefit payments received by retired U.S. armed forces, Reserve, and
National Guard members, or their surviving spouses, may be subtracted from North Dakota taxable income. The deduction
is equal to the taxable amount of the benefits reported on the federal income tax return for the tax year. For this purpose,
“U.S. armed forces” means the Army, Navy, Air Force, Marine Corps, and Coast Guard. Benefits received for federal civil
service employment as a military technician (dual status) are not eligible for this deduction.
Extension of Time to File
Service members serving in a combat zone
If you are serving, or providing direct support to military operations, in a presidentially-designated combat zone, you
have until the extended due date for filing your federal income tax return to file your North Dakota income tax return
and pay any tax due without penalty or interest. This also applies if you are a member of the National Guard or Reserve
mobilized for federal active duty who is serving, or providing direct support to military operations, in a combat zone. For
information on federal extensions for service members, go to the IRS’s website at www.irs.gov.
Service members not in a combat zone
Stationed outside the U.S.—If you are not serving (nor providing direct support to military operations) in a
presidentially-designated combat zone but are stationed outside the boundaries of the United States (including the
District of Columbia), you have until the due date (or extended due date) for filing your federal income tax return to file
your North Dakota income tax return and pay any state tax due without penalty or interest. For information on federal
extensions for service members, go to the IRS’s website at www.irs.gov.
www.nd.gov/tax | individualtax@nd.gov
600 E. Boulevard Ave., Dept 127 | Bismarck, ND 58505-0599
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