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North Dakota Estate Tax and Federal Filing
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North Dakota Estate Tax and Federal Filing

North Dakota collects no estate tax for deaths after 2004 and has no inheritance tax. Federal estate tax starts above $15 million in 2026.

By Settled Editorial

North Dakota collects no estate tax for deaths after 2004, has had no inheritance tax since 1927, and has no gift tax. The one death tax that can reach a North Dakota estate is the federal estate tax, and for a 2026 death it starts above $15,000,000 of gross estate plus lifetime taxable gifts. Most North Dakota families owe none of it.

This page covers why the North Dakota estate tax chapter is still in the Century Code but collects nothing, the Form 54-91 question the state's own sources answer two ways, how the federal tax works for a North Dakota estate, and the North Dakota rule in NDCC 30.1-20-16 that decides who pays if a federal bill arrives. It also covers the tax North Dakota does charge an estate: an income tax on Form 38. The basis reset on inherited property is a separate income tax question, covered under stepped-up basis.

What the Office of State Tax Commissioner Says

The Commissioner's estate tax page answers the question in its opening paragraph: "for deaths occurring after January 1, 2005, no estate taxes are paid to North Dakota."

Here is the rest, from the same page:

  • Estate tax. North Dakota still has an estate tax law, and the page cites chapter 57-37.1 of the North Dakota Century Code. No tax is paid under it for those deaths.
  • Inheritance tax. "North Dakota does not have an inheritance tax. The inheritance tax was repealed in 1927 and replaced with an estate tax."
  • Gift tax. "North Dakota does not have a gift tax."

So an heir who receives a farm, a house in Fargo, or a bank account owes the state nothing on the gift itself. The questions that remain are the federal tax, one North Dakota form for large estates, and income tax on what the estate earns.

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Why Chapter 57-37.1 Is Still in the Code

Open chapter 57-37.1 on the Legislative Council's site and you find live sections, not repeal notes. That surprises people who search the code on their own.

  • NDCC 57-37.1-02, "Tax on transfer of estates," says a tax "is hereby imposed upon the transfer of the North Dakota taxable estate of every decedent."
  • NDCC 57-37.1-04, "Computation of tax," says the tax "must be equal to the maximum tax credit allowable for state death taxes against the federal estate tax," prorated when only part of the estate has a taxable situs in North Dakota.

The North Dakota tax was always a share of a federal credit. The Commissioner's history page says the 1979 Legislature repealed the old rate table and tied the tax to that credit, and that "because the existing federal estate tax laws no longer provide a state death tax credit, which is the basis for North Dakota estate tax, estate tax is no longer due under North Dakota statutes." The same page says the tax was phased out for decedents whose death occurs after December 31, 2004, and that future changes to state or federal law will determine whether North Dakota estate tax is due again.

The accurate way to say it: North Dakota has no estate tax due for deaths after 2004. The chapter was never repealed.

Form 54-91: Two Official Answers

This is the one North Dakota filing question a large estate has to settle, and the state's own sources do not agree.

What the Commissioner's estate tax page says today. "While no North Dakota estate tax is due, a Form 54-91 - North Dakota Estate Tax Return is required for all decedent estates that are required to file a Federal estate tax return." The page puts the due date at 15 months after the date of death and lists what goes with it:

  1. A copy of the federal estate tax return, Form 706.
  2. A copy of the will, if there is one.
  3. A copy of any farm real estate appraisal.
  4. Form 131-3, the Supplemental Agricultural Property Information Form, covering any farm or ranch land.
  5. Form 54.29, the affidavit on the location of real estate and personal property in North Dakota, only if tax is due.

What the statute says. Two sections point different ways.

  • NDCC 57-37.1-21(1), "When return required," says the personal representative "shall file an estate tax return pursuant to this chapter for the estate of any decedent for whom a federal estate tax return is required to be filed if the federal gross estate includes any property or interest in property that has a situs in North Dakota." No session law from 2005 through 2025 amended it.
  • NDCC 57-37.1-06, amended in 2017 by Senate Bill 2129 (S.L. ch. 409), now opens: "If an estate owes tax under this chapter, the personal representative of the estate shall file with the tax commissioner the estate tax return required by this chapter."

The Commissioner's history page describes the 2017 legislation as eliminating "the requirement for an estate to file a North Dakota estate tax return unless tax is due with the return." That bill changed 57-37.1-06 and left 57-37.1-21 as it was, and the current estate tax page still asks for the return.

What to do with that: if the estate must file a federal Form 706 and holds property with a North Dakota situs, follow the Commissioner's current page, and call the Office of State Tax Commissioner at 701-328-7088 before deciding not to file. An estate under the federal filing threshold never reaches this question.

Situs has its own definition. NDCC 57-37.1-01(6) places real property in the state where it sits, tangible personal property where it was normally kept, and intangible personal property in the state where the decedent was a resident at death. A Minnesota resident who owned North Dakota farmland and had to file a 706 falls inside 57-37.1-21. A North Dakota resident's stocks and bank accounts have a North Dakota situs wherever the broker is.

The Tax North Dakota Does Charge an Estate: Form 38

North Dakota taxes what an estate earns, not what it is worth. This is the state return most North Dakota estates actually file.

The Commissioner's fiduciary tax page sets the rule:

  • Resident estate. The fiduciary must file Form 38, the Fiduciary Income Tax Return, if the fiduciary is required to file federal Form 1041, the U.S. Income Tax Return for Estates and Trusts.
  • Nonresident estate. The fiduciary files Form 38 if it is required to file Form 1041 and the estate received income from North Dakota sources during the year.
  • Due date. April 15. If the fiduciary receives an extension of time to file the federal Form 1041, the same extension applies to Form 38 automatically.
  • Estimated tax. Some estates must pay estimated North Dakota income tax, on Form 38-ES.

An estate that keeps renting out a quarter section of cropland for a season, or holds interest-paying accounts while probate runs, will usually have a Form 1041 and a Form 38. The rate table on the Commissioner's page changes by tax year, so read it for the year you are filing. None of this depends on the federal estate tax.

The Federal Number for a 2026 Death

The IRS says the Working Families Tax Cuts Bill, signed into law on July 4, 2025 as Public Law 119-21, amended IRC Section 2010(c)(3) and raised the exclusion amount to $15,000,000 for calendar year 2026.

The IRS publishes the filing threshold by year of death:

Year of deathFiling threshold
2024$13,610,000
2025$13,990,000
2026$15,000,000

A Form 706 is required if "the gross estate of the decedent, increased by the decedent's adjusted taxable gifts and specific gift tax exemption," is valued at more than the threshold for the year of death. That is a federal measure, and it counts far more than the property that goes through a North Dakota court.

The IRS describes the gross estate as everything the decedent owned or had certain interests in at death, at fair market value: cash and securities, real estate, insurance, trusts, annuities, business interests and other assets. Deductions then come off, including mortgages and other debts, estate administration expenses, and property that passes to a surviving spouse or a qualified charity. The IRS also notes that the value of some operating business interests or farms may be reduced for estates that qualify, which matters in a state where farmland is often the largest asset. Check the IRS table for the year of death rather than trusting a figure quoted in an older article.

Why the Federal Measure Is Bigger Than a North Dakota Probate Estate

The tools North Dakota families use to skip probate are the same ones that make the gross estate larger than the court file.

  • A recorded transfer on death deed. NDCC 30.1-32.1-09 says that during the owner's life the deed does not affect the owner's right to transfer or encumber the property and does not create a legal or equitable interest in the beneficiary. The owner still owns the land at death, so it counts toward the federal total. The guide to avoiding probate in North Dakota covers the deed and the other routes.
  • Payable on death and beneficiary accounts. They skip probate and still count here.
  • Life insurance and retirement accounts. The IRS lists insurance and annuities among the items that can be included.

North Dakota's small estate figure is a different kind of number. NDCC 30.1-23-01(1)(a) lets a successor collect personal property by affidavit when "the value of the entire estate subject to distribution or succession under chapters 30.1-01 through 30.1-23, wherever located, less liens and encumbrances, does not exceed one hundred thousand dollars." That is a court process test. It says nothing about a federal return. The North Dakota small estate affidavit guide explains what it does cover.

Who Pays the Bill: NDCC 30.1-20-16

If a federal estate tax is due, North Dakota law decides whose share of the estate it comes out of. National estate tax pages rarely mention this part.

NDCC 30.1-20-16(1)(f) defines "tax" as the federal estate tax and the additional estate tax imposed by chapter 57-37.1, plus interest and penalties. Section 30.1-20-16(1)(d) defines a "person interested in the estate" as anyone entitled to receive, or who has received, from a decedent or by reason of the death, any property included in the decedent's estate, and it includes a personal representative, conservator and trustee. NDCC 57-37.1-06 points to the same rule: federal and North Dakota estate taxes "must be apportioned as provided in section 30.1-20-16."

The default rule is subsection (2). Unless the will provides otherwise, the tax is apportioned among all persons interested in the estate, in proportion to the value of each person's interest, using the values used to figure the tax. If the will directs a different method, the will's method controls.

Put (1)(d) and (2) together. A transfer on death deed beneficiary, a payable on death account holder, and a life insurance beneficiary are all persons interested in the estate, even though none of those assets go through probate. Each can receive an apportioned share of the bill.

The rest of the section tells the personal representative how to collect:

  1. Withhold before you distribute. Under 30.1-20-16(4)(a) the personal representative may withhold from any property distributable to a person interested in the estate the tax attributable to that person's interest, and may recover a shortfall, or the whole share from someone whose property the representative never held.
  2. Take security for an early distribution. Under (4)(b), a distributee who receives property before final apportionment "shall provide a bond or other security for the apportionment liability in the form and amount prescribed by the personal representative."
  3. Deductions follow the gift. Under (5)(b), an exemption or deduction allowed because of a person's relationship to the decedent, or because of the purpose of a gift, benefits that person or that gift. A spouse's or a charity's share does not carry tax it did not cause.
  4. No split between life estate and remainder. Under subsection (6), the tax on a temporary interest such as a life estate, and on the remainder, is charged against the principal of the property.
  5. The collection clock. Under subsection (7), no one has a duty to sue for an apportioned share until three months after the tax is finally determined. A share that turns out to be uncollectible is equitably apportioned among the others.
  6. The court can step in. Under subsection (3), the court where venue lies for the administration can determine the apportionment on petition, its determination is prima facie correct in a later collection suit, and it may charge the fiduciary with penalties and interest caused by the fiduciary's own negligent delay.

Subsection (8) covers the cross-border case. A personal representative acting in another state may sue in North Dakota to recover a proportionate share of the federal estate tax, or of another state's estate tax, from a person interested in the estate who is domiciled in North Dakota or owns North Dakota property subject to attachment or execution.

Two other sections put estate taxes into the probate sequence. NDCC 30.1-19-05(1) ranks "debts and taxes with preference under federal law" third in the order of payment when the estate cannot pay every claim, after administration costs and reasonable funeral expenses. And a personal representative who closes by sworn statement under 30.1-21-03(1)(a) states that estate, inheritance and other death taxes were paid, settled or otherwise disposed of, except as the statement specifies. The North Dakota creditor claims guide covers the full claim order.

Portability, and the Return a Smaller Estate May Still Want

The IRS says that beginning January 1, 2011, the estate of a decedent survived by a spouse may elect to pass any of the decedent's unused exemption to the surviving spouse. The IRS calls this the deceased spousal unused exclusion, or DSUE, amount, and the choice is the portability election.

The catch is the filing. The IRS says the election "is made on a timely filed estate tax return," and that a Form 706 must be filed to elect portability "regardless of the size of the gross estate." So a North Dakota couple nowhere near $15,000,000 may still file a 706 at the first death, purely to lock in the survivor's larger exclusion.

If the deadline has passed, relief depends on whether the estate had a filing requirement. For an estate below the threshold, the IRS says Revenue Procedure 2022-32 allows a complete and properly prepared return filed on or before the fifth anniversary of the death, marked at the top "FILED PURSUANT TO REV. PROC. 2022-32 TO ELECT PORTABILITY UNDER § 2010(c)(5)(A)." No user fee applies. An estate that was over the threshold on its own gets no extension of time to elect portability.

A 706 filed only to elect portability raises the Form 54-91 question above, because the Commissioner's page keys that form to estates "required to file" a federal return. Ask the Commissioner's office how it treats a portability-only return.

Three Clocks That Do Not Match

  • Federal Form 706: nine months after the date of death. The IRS says every estate, including one filing only to elect portability, can get an automatic six month extension by filing Form 4768 on or before the due date.
  • North Dakota Form 54-91: 15 months after the date of death, per the Commissioner's estate tax page, for an estate the form applies to.
  • The North Dakota inventory: six months after appointment or nine months after the death, whichever is later, under NDCC 30.1-18-06(1).

If you wait for the inventory deadline before starting on the 706, the federal return may already be late. The inventory still helps: 30.1-18-06(1) requires each item's fair market value "as of the date of the decedent's death," the same date-of-death value the federal schedules use. That value also sets the new income tax basis heirs take, which the page on the North Dakota step-up in basis covers. The North Dakota probate timeline lays out the rest of the calendar, and the personal representative's duties sit alongside the other jobs that appointment starts.

What a North Dakota Family Should Do

  1. Add up the estate the federal way. Include the house, farmland held by transfer on death deed, life insurance the decedent owned, retirement accounts, and anything with a beneficiary form. If the total is far below $15,000,000 for a 2026 death, no federal estate tax applies and no Form 706 is required.
  2. If a spouse died, look at portability first. It is the main reason a modest estate files a 706. Revenue Procedure 2022-32 gives five years to fix a missed election when there was no filing requirement.
  3. If a 706 is required, plan on Form 54-91. The Commissioner's current page asks for it within 15 months, with no tax due. Confirm with the office rather than relying on the 2017 amendment alone.
  4. File the income tax returns. The final Form 1040 and North Dakota individual return for the year of death, and Form 1041 with North Dakota Form 38 for estate income, are the returns most North Dakota estates actually owe.
  5. Read the will before you distribute. A tax clause controls under NDCC 30.1-20-16(2). Without one, the default reaches nonprobate beneficiaries, and subsection (4) lets you take security or hold back.
  6. Bring in help when the facts are hard. A farm or ranch, a business interest, a noncitizen spouse, property in a state that still taxes estates, or a gross estate near the threshold are the cases where a CPA and a North Dakota estate attorney earn their fee.

The North Dakota probate guide covers the court side of the estate, and the North Dakota estate tax page shows whether an estate comes near the federal exemption.

Frequently Asked Questions

Does North Dakota have an estate tax?

No estate tax is due to North Dakota for anyone who died after 2004. The Office of State Tax Commissioner says that for deaths occurring after January 1, 2005, no estate taxes are paid to North Dakota. The law itself is still in the Century Code: NDCC 57-37.1-02 imposes a tax on the transfer of the North Dakota taxable estate, and 57-37.1-04 sets that tax equal to the maximum federal credit for state death taxes. Federal law no longer provides that credit, so the North Dakota tax comes to zero.

Does North Dakota have an inheritance tax or a gift tax?

No to both. The Office of State Tax Commissioner says North Dakota does not have an inheritance tax, which was repealed in 1927 and replaced with an estate tax, and that North Dakota does not have a gift tax. Heirs owe the state nothing on what they receive.

Does a North Dakota estate have to file Form 54-91?

Only an estate large enough to file a federal estate tax return is in the picture. The Tax Commissioner's estate tax page says a Form 54-91 North Dakota Estate Tax Return is required for all decedent estates that are required to file a federal estate tax return, due 15 months after the date of death, even though no North Dakota tax is due. NDCC 57-37.1-21 still says the same thing for any such estate whose federal gross estate includes North Dakota property. A 2017 amendment to 57-37.1-06 speaks of a return only if an estate owes tax, and the Commissioner's history page describes the 2017 change that way. The code has not reconciled the two, so follow the Commissioner's current page and confirm with that office before deciding not to file.

How large does an estate have to be before federal estate tax applies?

For a death in 2026 the federal filing threshold is $15,000,000. The IRS says Public Law 119-21, signed July 4, 2025, amended IRC 2010(c)(3) to raise the exclusion amount to $15,000,000 for 2026. The IRS table shows $13,610,000 for 2024 and $13,990,000 for 2025. The measure is the gross estate plus adjusted taxable gifts and specific gift tax exemption, which is often larger than the North Dakota probate estate.

Who pays the federal estate tax out of a North Dakota estate?

Unless the will says otherwise, NDCC 30.1-20-16(2) apportions the tax among all persons interested in the estate, in proportion to the value of each person's interest. Section 30.1-20-16(1)(d) defines a person interested in the estate as anyone entitled to receive, or who has received, property included in the decedent's estate by reason of the death, so a transfer on death deed beneficiary or a payable on death account holder can owe a share. A will that directs a different method controls.

Does a North Dakota estate file a state income tax return?

Often, yes. The Tax Commissioner says a fiduciary for a resident estate must file Form 38, the North Dakota Fiduciary Income Tax Return, if the fiduciary is required to file federal Form 1041. A nonresident estate files Form 38 if it must file Form 1041 and received income from North Dakota sources during the year. The return is due April 15, and a federal extension for Form 1041 automatically extends Form 38.

Related North Dakota Guides

This guide is general information about North Dakota estates and federal transfer taxes. Federal figures change every January, the Form 54-91 rule is unsettled in the code, and apportionment turns on the words of the will, so confirm anything that affects your situation with the Office of State Tax Commissioner, a CPA, or a licensed North Dakota attorney.

Sources:

It is not legal advice.

Information current as of September 28, 2026

Settled Estate is not a law firm, and this content is for informational purposes only and does not constitute legal advice. Probate laws and procedures in North Dakota can change. Consult with a qualified attorney for advice specific to your situation. Full disclaimer.

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