N.D. Cent. Code § 50-22-01(2)(b); (Note: Specifically, section (2)(b)(5) pertains to religious society or organization exemption.)
This state does not have a corporate franchise tax.
The following guidelines provide background information on the most common types of filings and the related exemptions in North Dakota.
This state has a narrow religious exemption for groups that are exempt from filing IRS Form 990, such as churches. For these groups, the exemption is automatic. Depending on their activities in this state, other religious organizations, not exempt from the IRS Form 990 requirement, may need to complete a charitable registration, despite their religious identity.
This state does not have a specific solicitation threshold amount that triggers the registration requirement.
In this state, organizations that are required to register have the option of registering through the Unified Registration Statement, which is a standardized charitable registration accepted in many states. Using the URS, rather than a state-specific registration form, has pros and cons. The URS typically must be submitted by mail. North Dakota has an online filing system, and using that system may be more efficient than completing and mailing the URS manually. Additionally, information from the state-specific initial registration can be used to auto-populate annual reports, which could save the organization time in the future.
Note that this jurisdiction requires organizations registered with the secretary of state to appoint an in-state registered agent. This can be done through a commercial service or by appointing a person or entity who is a supporter of your organization or, at the very least, willing to be your agent and is located within the state.
Within the charitable organization solicitation statute (N.D. Cent. Code § 50-22), there are no requirements for an organization to post specific language when conducting charitable solicitations. However, the use of fraudulent or other deceptive language, acts, or practices is forbidden. See N.D. Cent. Code § 50-22-04.3.
This jurisdiction requires foreign nonprofit organizations that are not eligible for the statutory exemption to register with the secretary of state as a business before the organizations can complete their charitable solicitation registration.
In this state, organizations that have received recognition of federal income tax exemption and have no federal unrelated business taxable income (“UBTI”), will be automatically tax exempt from North Dakota corporate income tax. North Dakota does not require a corporation income tax return, or an informational return to be filed in this instance.
However, a corporation that has obtained tax exempt status for federal income tax purposes and that has federal unrelated business taxable income (“UBTI”) is required to file a North Dakota Form 40 corporation income tax return and pay the applicable tax. According to the Office of the Tax Commissioner’s website, “returns of tax- exempt organizations reporting unrelated business taxable income are due on the 15th day of the fifth month after the close of the tax year.”
It is also important to consider whether applying for sales and use tax and property tax exemptions would be appropriate for your organization. Charities and nonprofits are not generally eligible for exemptions from sales and use tax, but some specific exemptions are available. Information about property tax exemption is available from the state tax commissioner as well as local county websites, such as this example from Ward County. An accountant or attorney can provide answers to specific questions regarding your organization’s eligibility for exemption.
This resource contains general educational information related to legal concepts, but this information does not constitute legal advice. Anyone seeking legal advice is strongly encouraged to consult with a licensed attorney regarding any of the matters discussed herein. Although licensed attorneys work with NLI, NLI is not a law firm and does not undertake legal representation on behalf of any clients. Further, no licensed attorney working with or on behalf of NLI agrees to undertake legal representation on behalf of any client unless the terms of such representation are set forth in a separate, written representation agreement.