State guide · North Dakota · 2026 rules

S corporation in North Dakota: what the election changes

North Dakota adds little to the S-corp math. The business pays no state income tax, and the main change is unemployment insurance on your salary.

Updated October 24, 20264 official sources

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You’ll need: last year’s Schedule C (line 31) and the W-2 from any job you also hold. Everything else starts at a typical value you can change.

State where the business is Each state treats the election differently. The check shows only the questions that matter there.

Net profit for the year, before paying yourself Your business's profit after expenses. Money you take out for yourself does not lower it.

Where do I find this?

Schedule C, line 31 (“Net profit or (loss)”) on last year’s return.

For this year: sales minus business expenses so far, scaled to a full year. Owner draws are not an expense.

Salary you would pay yourself as an S corporation What you would pay yourself through payroll. The IRS expects a reasonable salary for the work you do.

Where do I find this?

No form shows this yet: you choose it. It should be about what you would pay someone else to do your work.

The salary finder just below shows what employees in your job earn in your state or metro area. What the IRS looks at.

Salary finder: what people in your job earn (BLS)

Your job Pick the job closest to what you do most of the week.

Area Pick your metro area if it is listed. Pay varies by area.

Another job I also earn W-2 wages from a job outside this business

Typical values: change them if you know yours

Payroll service, per year typical value Published one-person prices: $492 to $684 a year (October 2026).

Where do I find this?

Your payroll provider’s price page or quote, for one employee: you. Published prices compared.

Extra tax-prep cost for the S-corp return typical value A survey average: the fee for Form 1120-S minus the fee for Schedule C (2020 fees).

Where do I find this?

Ask your preparer what a Form 1120-S (the S corporation’s own return) would cost, then subtract what you pay now for Schedule C.

Your top federal income tax rate Not sure? Keep 22%. It changes line 5 only.

Where do I find this?

Your taxable income is on Form 1040, line 15. Find the rate for that income and your filing status in the IRS rates and brackets table.

Filing status Changes the result only above $200,000 of earnings ($250,000 if married filing jointly, $125,000 if married filing separately).

Where do I find this?

The box checked under Filing Status at the top of your Form 1040.

Choose a state and enter your profit and salary to see the comparison.

The state

North Dakota follows the federal S election, with no separate state form. The S corporation files Form 60 by April 15.

An ordinary S corporation pays no North Dakota income tax; its income passes through to you, as it does from a single-member LLC today. The state taxes an S corporation only on income it also owes federal corporate tax on, such as built-in gains.

An LLC that elects stays an LLC under state law. It keeps filing the same $50 annual report with the Secretary of State, due November 15.

North Dakota has no optional pass-through entity tax.

Unemployment tax on your salary

Unemployment insurance: 1.00% for a new non-construction employer on the first $46,600 of wages in 2026. The law counts a corporate officer, and the manager of an LLC taxed as a corporation, as an employee.

An officer who owns one-fourth or more can be excluded, with the officer’s agreement. The business applies to Job Service North Dakota within 60 days of formation, or in January for the year the exclusion starts. Your wages then still bear the full federal unemployment tax. The calculator counts state unemployment tax on your salary.

Worked examples

A single-member LLC owner, single filer, 22% federal bracket, default payroll and return costs. The figure is total tax and added costs as an S corporation compared with staying as you are.

Profit / salary	Statewide
$80,000 / $45,000	$564 lower
$120,000 / $60,000	$2,952 lower
$200,000 / $90,000	$7,733 lower

Starting payroll in North Dakota

Register for state withholding with the North Dakota Office of State Tax Commissioner through ND TAP, and for unemployment insurance with Job Service North Dakota within 20 days after you first employ workers.

New hire paperwork for North Dakota

Other states

All state guides and the map

Sources

Federal figures: IRS Publication 15 (2026), Schedule SE and Form 2553 instructions. Every figure was read on an official page and checked a second time. Checked October 24, 2026. How we check facts.

An estimate from public rules, not tax advice.

Ready to elect? See the Form 2553 steps.

Electing S corp status