North Dakota Form 60 Booklet - S Corporation Income Tax

Form 60 Booklet - S Corporation Income Tax
S Corporation Income Tax Booklet 2023
TAX.ND.GOV

2023

NORTH DAKOTA

S CORPORATION
INCOME TAX
INCLUDES
SCHEDULE FACT
SCHEDULE BG
SCHEDULE K
SCHEDULE KS
SCHEDULE K-1
Email Questions to: [email protected]

Contents

Need help?

Where to get help and forms......................................................... This page

You can download forms and find other
information on our website at:

Changes for 2023....................................................................................1
General instructions.................................................................................2
	 Who must file......................................................................................2
	 When and where to file.........................................................................2
	 Extension of time to file........................................................................2
	 Penalty and interest.............................................................................3
	 Estimated tax payment (for 2024).........................................................3
	 Withholding from nonresident shareholders.............................................3
	 Composite filing...................................................................................3
	 Correcting a previously filed return.........................................................4
	 Reporting federal changes.....................................................................4
	 W-2/1099 reporting requirement...........................................................4
	 Disclosure notification..........................................................................4
	 Use of information...............................................................................4
General instructions for completing Form 60...............................................4
Specific line instructions...........................................................................5
	 Form 60, Page 1, Items A-H..................................................................5
	 Schedule FACT....................................................................................6
	 Schedule BG.......................................................................................7
	 Schedule K.........................................................................................7
	 Schedule KS...................................................................................... 11
	 Form 60, Page 1, Lines 1-13................................................................ 12
	 Schedule K-1..................................................................................... 13
	 Before you file Form 60...................................................................... 15

Required forms

The following forms are needed to complete Form 60:
	 Form 60	
S corporation return
	 Schedule FACT	 Calculation of North Dakota apportionment factor
	 Schedule BG	
Tax on excess net passive income and built-in gains
	 Schedule K	
Total North Dakota adjustments, credits, and other
			 items distributable to shareholders
	 Schedule KS	
Shareholder information
	 Schedule K-1	
Shareholder’s share of North Dakota income (loss), .
deductions, adjustments, credits, and other items

www.tax.nd.gov

Email
Individual, estate, trust, partnership,
and S corporation income tax—
	 [email protected]

Call
Individual income tax—
	 Questions	
701-328-1247
	Forms	
701-328-1243
S Corporation income tax—
	 Questions	
701-328-1258
	Forms	
701-328-1243
Speech/hearing impaired
	TDD	800-366-6888

Write

Office of State Tax Commissioner
600 E. Boulevard Ave., Dept. 127
Bismarck, ND 58505-0599

Walk-in or appointment
service

State Capitol Building, 8th Floor
600 E. Boulevard Ave., Bismarck, ND
Monday through Friday
8:00 a.m. to 5:00 p.m.
(except holidays)
Walk-ins are welcome. To assure
availability and promptness of
service, call in advance to make an
appointment.

The following forms may be needed:
	 Form 60-PV	
	 Form 60-EXT	
	 Form 101	
	 Form PWA	
	 Form PWE	

S corporation return payment voucher
S corporation extension payment voucher
Application for extension of time to file a North Dakota
income tax return
Passthrough entity withholding adjustment
Nonresident passthrough entity member exemption and
certification

Download these forms from our website at www.tax.nd.gov.

Taxpayer Bill of Rights
Obtain a copy of the North Dakota Taxpayer Bill of Rights on the
Office of State Tax Commissioner’s website at
www.tax.nd.gov

Privacy Act Notification
In compliance with the Privacy Act of
1974, disclosure of a Federal Employer
Identification Number (FEIN) or social
security number on this form is required
under N.D.C.C. §§ 57-01-15 and 57‑38‑32,
and will be used for tax reporting,
identification, and administration of
North Dakota tax laws. Disclosure is
mandatory. Failure to provide the FEIN or
social security number may delay or prevent
the processing of this form.

1

Changes affecting S corporations

Developments, updates, and items of interest relating to S corporation income tax
REMINDER - Electronic Filing

S corporations with 10 or more
shareholders are required to file the
North Dakota income tax return and
pay any tax due on it by electronic
means. If an s-corporation return with
10 or more shareholders is filed on
paper, the return will not be processed
and may be subject to penalties due
to the failure to file electronically.

NEW - North Dakota
passthrough withholding

Income tax rates were lowered
effective with the 2023 tax year. The
highest rate was lowered to 2.50%.
The income tax withholding rate on
nonresident owners of passthrough
entities was also lowered and is
reflected on the 2023 income tax
forms and instructions.

NEW - Contributions to
maternity home, child placing
agency, or pregnancy help
center

An income tax credit is allowed
for contributions to a child placing
agency licensed by the North Dakota
Department of Health and Human
Services (DHS), a nonprofit maternity
home located in North Dakota, or a
pregnancy help center recognized by
DHS.
The credit is equal to 100% of the
contribution. The credit is limited to
50% of a taxpayer’s tax liability. Any
credit earned in excess of the limit
may not be carried forward or back to
other tax years.
The credit is available to corporations,
individuals, estates, trusts, and
passthrough entities. A tax credit
earned by a passthrough entity is
passed through and allowed to each
owner in proportion to their respective
interests in the passthrough entity.

NEW – Tax credit for
compensation paid to an
apprentice

An income tax credit was created
for the employment of a qualified
apprentice in an apprenticeship
program position in North Dakota.

The apprentice must be in an
apprenticeship program certified by
the U.S. Department of Labor or be an
electrical apprentice registered under
North Dakota law.
The credit is equal to 10% of the
stipend or salary paid to the qualified
apprentice. The maximum credit a
taxpayer can claim over all tax years
is $3,000 and limits the earning of a
tax credit to only five apprentices at
the same time. Any credit earned in
excess of the limit may not be carried
forward or back to other tax years.
The credit is available to corporations,
individuals, estates, trusts, and
passthrough entities. A tax credit
earned by a passthrough entity is
passed through and allowed to each
owner in proportion to their respective
interests in the passthrough entity.

UPDATE – Renaissance Zone
tax incentive changes effective
August 1, 2023
A variety of changes occurred to the
Renaissance Zone program. One of
the changes is the maximum length
of an income tax incentive was
changed from five years to eight
years for a project that meets certain
rehabilitation thresholds. Specifically,
for residential (except owner
occupied) and commercial property, a
rehabilitation level exceeding 75% is
required to allow for an exemption up
to 8 years. Rehabilitation exceeding
50% is required for an exemption
up to 5 years. For owner occupied
residential property, rehabilitation
exceeding 20% may qualify for an
exemption up to eight years.
For additional RZ information, please
refer to our website:
www.tax.nd.gov/renaissancezone-incentives.

UPDATE – Automation tax
credit

The 2023 North Dakota Legislature
made changes to the existing
automation tax credit program. The
program was expanded to include
automation or robotic equipment
purchased to upgrade or advance an
animal agricultural process.

The tax rate was changed from up
to 20% to 15% of the cost of the
qualifying equipment. The annual
maximum statewide tax credits
authorized was increased from
one million to three million per year.
Of the three million annual total tax
amount, $500,000 of tax credits is
reserved each year for first-time
claimants for automation equipment
and $500,000 of tax credits is
reserved each year for first-time
claimants for animal ag equipment.
The program was also made
permanent. Other provisions were
unchanged.
The changes are applicable for
purchases during calendar year 2023,
for which applications would be due
to the Department of Commerce by
January 31, 2024. The requirement
continues to exist for a claimant to
subsequently file with the Office of
State Tax Commissioner a report of
Improved Job Quality or Increased
Productivity.

UPDATE - Disabled
employment tax credit

In 2023, the North Dakota Legislature
reenacted and made permanent the
existing income tax credit related to
the employment of an individual with
developmental disabilities or severe
mental illness. The existing provisions
of the tax credit were unchanged,
except the statewide limitation on
the number of eligible employees was
removed and there is no limit.

Stay informed of developments
Individuals, businesses, or other
interested persons may sign up to
receive email notifications when
a newsletter or other important
information is issued by the Office of
State Tax Commissioner. To sign up,
go to www.tax.nd.gov and select
“News Center” at the top of the page.
Then select “Email Sign-Up”

2

Form 60 Instructions	

2023

North Dakota S Corporation Income Tax Return
“N.D.C.C.” references are to the North Dakota Century Code, which contains North Dakota’s statutes.
“N.D. Admin. Code” references are to the North Dakota Administrative Code, which contains North Dakota’s rules.

General
instructions
Who must file

A 2023 Form 60, S Corporation
Income Tax Return, must be filed by
a corporation that meets both of the
following:
	 •	 It is required to file a 2023
Form 1120‑S, U.S. Income Tax
Return for an S Corporation.
	 •	 It carries on business, or derives
gross income from sources, in
North Dakota during the 2023 tax
year.
Exception for certain
S corporations. An S corporation
must file a 2023 Form 40,
North Dakota Corporation Income Tax
Return, for the 2023 tax year if all of
the following apply:
	•	 The corporation is a bank or other
financial institution that formerly
was subject to the North Dakota
financial institution tax under
N.D.C.C. Ch. 57‑35.3 and filed
Form 35 for tax years prior to
2013.
	•	 The corporation made an election
under N.D.C.C. § 57‑38-01.35 to
be taxed as a C corporation for
the 2013 tax year and filed a 2013
Form 40.

Disaster recovery tax exemptions.
Exemptions from state and local tax
filing and payment obligations are
available to out-of-state businesses
and their employees who are in
North Dakota on a temporary basis
for the sole purpose of repairing
or replacing natural gas, electrical,
or telecommunication transmission
property that is damaged, or under
threat of damage, from a state- or
presidentially-declared disaster or
emergency. For more information, go
to www.tax.nd.gov.

Electronic Filing

S-corporations with 10 or more
owners are required to file the
North Dakota income tax return and
pay any tax due on it by electronic
means.

When and Where to file

The 2023 Form 60 must be filed on
or before (1) April 15, 2024, if filing
for the 2023 calendar year, or (2) the
15th day of the 4th month following
the end of the tax year, if filing for
a fiscal year beginning in the 2023
calendar year. If the due date falls
on a Saturday, Sunday, or holiday,
the return may be filed on or before
the next day that is not a Saturday,
Sunday, or holiday.
Note: Use the 2022 Form 60 if
filing for a fiscal year beginning in
the 2022 calendar year.

	•	 The corporation’s North Dakota net
tax liability on the 2022 Form 40
(page 1, line 20) is zero and the
corporation is not revoking the
election for 2023, which is done
by filing Form 60 for the 2023 tax
year.

If not required to file
electronically, mail Form 60 and all
required attachments to:

See the instructions to Form 40 for
more information.

Extension of time to file

Nonfiler penalty. If an S corporation
does not file Form 60 as required,
a minimum $500 penalty may be
assessed if the failure continues after
receiving a thirty-day notice to file
from the North Dakota Office of State
Tax Commissioner.

	 Office of State Tax Commissioner 	
	 600 East Boulevard Ave., Dept. 127 	
	 Bismarck, ND 58505-0599

An extension of time to file Form 60
may be obtained in one of the
following ways:
	 •	 Obtain a federal extension.
	 •	 Separately apply for a
North Dakota extension.

Federal extension. If an extension
of time to file the federal corporation
return is obtained, it is automatically
accepted as an extension of time to
file Form 60. If this applies, a separate
North Dakota extension does not have
to be applied for, nor does the Office
of State Tax Commissioner have to
be notified that a federal extension
has been obtained prior to filing
Form 60. The extended due date for
North Dakota purposes is the same as
the federal extended due date.
North Dakota extension. If a
federal extension is not obtained,
but additional time is needed to
complete and file Form 60, a separate
North Dakota extension may be
applied for by filing Form 101,
Application for Extension of Time to
File a North Dakota Tax Return. This
is not an automatic extension—there
must be good cause to request a
North Dakota extension. Form 101
must be postmarked on or before the
due date of Form 60. Notification of
whether the extension is accepted or
rejected will be provided by the Office
of State Tax Commissioner.
Extension interest. If Form 60 is
filed on or before the extended due
date, and the total amount of tax due
is paid with the return, no penalty will
be charged. Interest on the tax due
will be charged at the rate of 12% per
year from the original due date of the
return to the earlier of the date the
return is filed or the extended due
date.
Prepayment of tax due. If an
extension of time to file Form 60 is
obtained, any tax expected to be due
may be paid on or before the regular
due date to avoid paying extension
interest. For more information,
including payment options, obtain the
2023 Form 60‑EXT.

3
Penalty and interest

If an extension of time to file the
return was obtained, the tax due may
be paid by the extended due date
of the return without penalty, but
extension interest will apply at the
rate of 12% per year—see “Extension
interest” and “Prepayment of tax due”
on page 2.

	•	 a trust, including a grantor trust,
that is not organized under
North Dakota law. This only
includes trusts that are subject to
income tax.
Exception from withholding. No
withholding is required if any of the
following apply:

If Form 60 is filed by its due date (or
extended due date), but the total
amount of tax due is not paid by the
due date (or extended due date), a
penalty equal to 5% of the unpaid tax
or $5.00, whichever is greater, must
be paid.

	•	 The distributive share of
North Dakota income is less than
$1,000.

If Form 60 is filed after its due date
(or extended due date), and there
is an unpaid tax due on it, a penalty
equal to 5% of the unpaid tax due or
$5.00, whichever is greater, for the
month in which the return was due
plus 5% of the unpaid tax due for
each additional month (or fraction
of a month) during which the return
remains delinquent must be paid. This
penalty may not exceed 25% of the
tax due.

	•	 The nonresident shareholder is a
trust and elects exemption from
withholding on its distributive
share of North Dakota income.
For more information, obtain
Form PWE.

In addition to any penalty, interest
must be paid at the rate of 1% per
month or fraction of a month, except
for the month in which the tax was
due, on any tax due that remains
unpaid after the return’s due date (or
extended due date).

Estimated tax payment
(for 2024)

An S corporation may, but is not
required to, make estimated income
tax payments. For more information,
including payment options, obtain the
2024 Form 60-ES.

Withholding from
nonresident shareholders

An S corporation must withhold
North Dakota income tax at the rate of
2.50% from the year-end distributive
share of North Dakota income of a
nonresident shareholder.
Nonresident shareholder. For
purposes of this withholding
requirement, a nonresident
shareholder means:
	•	 an individual who is not domiciled
in North Dakota, or

	•	 The nonresident shareholder elects
to include the distributive share in
a composite filing—see “Composite
filing” on this page.

Withholding procedure. This
withholding requirement applies to a
nonresident shareholder’s year-end
distributive share of North Dakota
income, which is determined at
the end of the S corporation’s tax
year and reported on Form 60,
Schedule KS, Column  6. The
requirement does not apply to actual
distributions made to a nonresident
shareholder during the tax year. The
withholding amount is calculated and
reported on Schedule KS, Column 7.
If a nonresident shareholder meets
certain conditions, an amount less
than the amount calculated at the
2.50% tax rate may be withheld.
For the qualifying conditions, see
Form PWA. An S corporation must
submit a payment for the the total
amount of withholding reported on
Schedule KS, Column 7, with Form 60
when it is filed.

Composite filing

A composite filing method is available
to an S corporation with one or more
eligible nonresident shareholders.
Under this method, an S corporation
calculates the North Dakota income
tax on an eligible nonresident
shareholder’s year-end distributive
share of North Dakota income and
pays the tax with Form 60. The
tax is calculated at the highest
individual income tax rate (which is

2.50% for the 2023 tax year), and
no adjustments, deductions, or tax
credits are allowed in calculating the
tax. A composite filing satisfies the
North Dakota income tax filing and
payment obligations of the eligible
nonresident shareholders included in
it, which means they do not have to
separately file their own North Dakota
income tax returns. The composite
filing method is optional and does
not require prior approval from the
Office of State Tax Commissioner, and
a choice to use it may be made on a
year-to-year basis.
Eligible nonresident shareholder.
For this purpose, a nonresident
shareholder has the same meaning
as that used for withholding income
tax from nonresident shareholders—
see “Withholding from nonresident
shareholders” on this page. A
nonresident shareholder is eligible
to be included in a composite filing if
both of the following apply:
	•	 The nonresident shareholder’s
only source of income within
North Dakota is one or more
passthrough entities. A
passthrough entity includes a trust,
partnership, S corporation, limited
liability company treated like a
partnership or S corporation, and
any other similar entity.
	•	 The nonresident shareholder elects
to be included in a composite
filing. An election is indicated by
the S corporation’s calculation
and reporting of a tax amount for
the nonresident shareholder on
Form 60, Schedule KS, Column 8.
(If the distributive share is a loss,
the tax is zero.)
The distributive share of North Dakota
income included in a composite return
is subject to tax even if it is under
$1,000.
Composite filing method
procedure. The tax under the
composite filing method
is calculated and reported on
Form 60, Schedule KS, Column 8.
An S corporation must submit a
payment for the total tax reported on
Schedule KS, Column 8, with Form 60
when it is filed.

4
Correcting a previously filed
return
If a corporation needs to correct an
error on Form 60 after it is filed, the
corporation must file an amended
return. There is no special form for
this purpose. See “How to prepare an
amended 2023 return” below.
Note: If required to electronically
file the original return, the amended
return must also be electronically
filed.
If a corporation paid too much tax
because of an error on its 2023
Form 60, the corporation generally
has three years from the due date of
the return (excluding extensions) or
the date the return was actually filed,
whichever is later, in which to file an
amended return to claim a refund
of the overpayment. See N.D.C.C.
§ 57‑38-40 for other time periods that
may apply.
How to prepare an amended 2023
return
	 1.	 Obtain a blank 2023 Form 60.
	 2.	 Enter the corporation’s name,
current address, FEIN, etc., in the
top portion of page 1 of Form 60.
	 3.	 Fill in the “Amended return” circle
at the top of page 1 of Form 60.
	 4.	 Complete Schedules FACT, BG,
K, and KS using the corrected
information. However, unless
there is an increase in the
amount reported on Schedule KS,
Column 6, of the amended
return, enter on Schedule KS,
Column 7, the same amount
reported on the previously filed
return. Then complete lines 1
through 4 on page 1 of Form 60.
	 5.	 On line 6 of page 1 of Form 60,
enter the total taxes due from the
previously filed 2023 Form 60,
page 1, line 4.
	 6.	 Complete line 8 (overpayment)
or line 11 (tax due), whichever
applies. If there is an
overpayment on line 8, enter the
full amount on line 10 (refund).
On an amended return, the
amount credited to the next
year’s estimated tax (line 9) may
not be increased or decreased.

	 7.	 Attach a statement explaining the
reason(s) for filing the amended
return. If it is because of changes
the corporation or the IRS made
to the corporation’s 2023 Federal
Form 1120-S, attach a copy of
the amended federal return or
IRS notice.
	 8.	 Complete and provide a corrected
North Dakota Schedule K-1
(Form 60) to the shareholders, as
required.

Reporting federal changes

under state law so the Office of State
Tax Commissioner can determine the
shareholder’s correct North Dakota
taxable income and verify if the
shareholder has filed a return and
paid the tax.

General
instructions for
completing
Form 60

If the Internal Revenue Service
(IRS) changes or audits the federal
corporation return, or if a corporation
files an amended federal corporation
return, an amended North Dakota
Form 60 must be filed within ninety
days after the final determination of
the IRS changes or the filing of the
amended federal return. Enclose a
copy of the IRS audit report or the
amended federal corporation return
with the amended North Dakota
Form 60.

Complete Form 60 as
follows:

W-2/1099 reporting
requirement

	 5.	 Complete Schedule K on page 3
of Form 60—see page 7.

Every corporation doing business in
North Dakota that is required to file
Federal Form 1099 or W-2 must also
file one with the Office of State Tax
Commissioner. For more information,
obtain the guideline Income Tax
Withholding and see “Information
Returns.”

Disclosure notification

Upon written request from the
chairman of a North Dakota legislative
standing committee or Legislative
Management, the law requires the
Office of State Tax Commissioner to
disclose the amount of any deduction
or credit claimed on a tax return. Any
other confidential information, such as
a taxpayer’s name or federal employer
identification number, may not be
disclosed.

Use of information

All of the information on Form 60 and
its attachments is confidential by law
and cannot be given to others except
as provided by state law. Information
about the shareholders is required

	 1.	 Complete Federal Form 1120-S in
its entirety.
	 2.	 Complete Items A through H at
the top of page 1 of Form 60—see
page 5.
	 3.	 Complete Schedule FACT on
page 2 of Form 60—see page 6.
	 4.	 Complete Schedule BG, if
required, on page 2 of Form 60—
see page 7.

	 6.	 Complete Schedule KS on page 5
of Form 60—see page 11.
	 7.	 Complete lines 1 through 13 on
page 1 of Form 60—see page 12.
	 8.	 Complete Schedule K-1, if
required, for the shareholders—
see page 13.
Rounding of numbers. Numbers
may be entered on the return in
dollars and cents, or they may be
rounded to the nearest whole dollar. If
rounding, drop the cents if less than
$0.50 and round up to the next whole
dollar amount if $0.50 or higher. For
example, $25.36 becomes $25.00,
and $25.50 becomes $26.00.
Fiscal year filers. The tax year for
North Dakota income tax purposes
must be the same as the tax year
used for federal income tax purposes.
Use the 2023 Form 60 if the
corporation’s taxable year began in
the 2023 calendar year.

5

Specific line
instructions for
page 1 of Form 60,
Items A-H
Complete Items A
through H at the top of
page 1 of Form 60. Then
complete Schedule FACT,
Schedule BG, Schedule K,
and Schedule KS before
completing lines 1 through
13 on page 1 of Form 60.
Item A - Tax year
The same tax year used for federal
income tax purposes (as indicated on
the federal corporation return) must
be used for North Dakota income
tax purposes. Fill in the applicable
circle. If the corporation uses a fiscal
year, enter the beginning and ending
dates of the fiscal year. Use the 2023
Form 60 only if the corporation’s tax
year began in the 2023 calendar year.
Item B - Name and address
Enter the legal name of the
corporation on the first line of the
name and address area. If the
corporation publicly operates under
a fictitious or assumed name (which,
in most states, must be recorded or
registered with the state), enter that
name on the second line of the name
and address area. Always use the
current address of the corporation.
Item C - Federal EIN
North Dakota uses the federal
employer identification number (FEIN
or federal EIN) for identification
purposes. Enter the federal employer
identification number from page 1 of
Federal Form 1120-S.
Item D - Business code number
Enter the business code from the
NAICS code list found on the Office
of State Tax Commissioner’s website
at www.tax.nd.gov. Enter the
code that most closely describes the
industry from which the corporation
derives the majority of its income.

Item E - Date incorporated
Enter the date the business
incorporated from page 1 of Federal
Form 1120-S.
Item F - Indicators
Fill in all applicable circles, as follows:
Initial return. Fill in if this is the first
return filed in North Dakota by the
corporation.
Final return. Fill in if this is the last
return to be filed in North Dakota by
the S corporation.
Farming/ranching corporation. Fill
in if the corporation is registered as a
farming or ranching corporation with
the North Dakota Secretary of State.
Composite return. Fill in this circle
only if (1) the corporation has one
or more nonresident shareholders
eligible to be included in a composite
filing and (2) all of them elected
to include their distributive shares
of North Dakota source income in
a composite filing. See “Composite
filing” on page 3 for more information.

Amended return. Fill in if this return
is being filed to correct a previously
filed 2023 Form 60. See “Correcting a
previously filed return” on page 4 for
more information.
Extension. Fill in if a federal or
state extension of time to file the
return was obtained. See “Extension
of time to file” on page 2 for more
information.
Item G - Number of shareholders
Enter the total number of
shareholders. Also enter the number
of each type of shareholder. For
“Trust/estate shareholders,” only
include trusts that are not tax-exempt
organizations for federal income tax
purposes.
Item H - Qualified subchapter S
subsidiary
Indicate whether the corporation is
a parent of one or more qualified
subchapter S subsidiaries. Attach
a statement to Form 60 listing
the name and federal employer
identification number of each qualified
subchapter S subsidiary.

Worksheet for Schedule BG, Line 6
North Dakota net operating loss deduction

	1.	Net recognized built-in gain from Form 60,
		Schedule BG, line 2............................................................. 1	_________________
	2.	Apportionment factor from Schedule BG, line 4....................... 2	__.__ __ __ __ __ __
	3.	North Dakota apportioned built-in gain.
		Multiply line 1 by line 2........................................................ 3	_________________
	4.	Accumulated North Dakota net
		operating loss as of the end of the
		last tax year as a C corporation.
		
Enter as a positive number...................4	_________________
	5.	Portion of line 4 that was previously
		deducted for North Dakota income tax
		purposes by the corporation.
		
Enter as a positive number...................5	_________________
	6.	Remaining North Dakota net operating loss.
		Subtract line 5 from line 4. If less than zero, enter -0-............. 6	_________________
	7.	North Dakota net operating loss deduction. Enter smaller of
		line 3 or line 6. Enter result on Schedule BG, line 6.................. 7	_________________

2023 Corporation Tax Rate Schedule
If the amount on
Schedule BG, line 7 is:	

The tax is equal to:

Over		
But not over
$	
0	
$	 25,000....................................... 1.41% of the amount on line 7
	 25,000		 50,000....... $	 352.50	 +	 3.55%	 of the amount over	 $	 25,000
	50,000................................. 1,240.00	 +	 4.31%	 of the amount over		 50,000

6

Instructions for
Schedule FACT
(Form 60, page 2)

General instructions
All corporations must complete the
applicable portions of Schedule FACT
as follows:
	•	 100% North Dakota
corporation
		 If the corporation conducted all
of its trade or business within
North Dakota during the tax
year, skip lines 1 through 13 and
enter “1.000000” on line 14 of
Schedule FACT.
	•	 Multistate corporation
		 If the corporation conducted its
trade or business both within
and without North Dakota during
the tax year, complete lines 1
through 14 of Schedule FACT.
However, if all of the shareholders
consist of only North Dakota
resident individuals, estates, and
trusts, and the corporation is not
required to complete Schedule BG,
skip lines 1 through 13, and
enter “1.000000” on line 14 of
Schedule FACT.

Apportionment factor in
general

In general, the apportionment factor
is a product of a formula consisting of
an equally-weighted average of three
factors: property, payroll, and sales.
Each factor represents the percentage
of the corporation’s North Dakota
activity compared to its total
activity everywhere. A corporation
multiplies its business income by the
apportionment factor to determine
the portion of its business income
attributable to North Dakota.
If the corporation includes the
distributable share of income from
a partnership in its apportionable
business income, include in the
numerator and denominator of each
factor the corporation’s proportionate
share of the partnership’s
apportionment factors—see the
specific line instructions for more
information. Do not include in the
factors any property, payroll, or sales
related to allocable nonbusiness
income—see the instructions to
Form 60, Schedule K, line 22, for what

constitutes allocable nonbusiness
income.
If the amount of any factor’s
denominator is zero, exclude that
factor from the calculation.
Special apportionment rules
may apply in the case of certain
industries or unique circumstances.
For additional information on the
apportionment factor, see N.D.C.C.
Ch. 57-38.1 and N.D. Admin. Code
Ch. 81-03-09.

Specific line instructions
Property Factor
Lines 1 through 6
Owned and rented property
Enter on the applicable line the
average value of real and tangible
personal property owned and rented
by the corporation. For owned
property, this generally means the
average of the original cost (before
depreciation) used for federal income
tax purposes. For rented property,
this generally means the amount of
rent paid multiplied by eight. Certain
property items are subject to special
rules. Do not include amounts related
to construction in progress. Include on
line 5 the corporation’s share of the
property factor from a North Dakota
Schedule K-1 (Form 58), Part 6.

benefit plans that are not considered
taxable wages to the employee. An
employee is an individual treated as
an employee under the usual common
law rules, which generally mirror an
individual’s status for purposes of
unemployment compensation and the
Federal Insurance Contribution Act.
Compensation of an employee’s
services performed entirely within
North Dakota is assigned to
North Dakota. For an employee whose
services are performed in more than
one state, compensation is generally
assigned to North Dakota based on
the amount of compensation reported
to North Dakota for unemployment
compensation purposes. Whether
or not state income tax was
withheld from an employee’s
compensation does not affect where
the compensation is assigned for
apportionment factor purposes.
Include on this line in the applicable
column the corporation’s share of the
payroll factor from a North Dakota
Schedule K-1 (Form 58), Part 6. For
more complete information on the
payroll factor, see N.D. Admin. Code
§§ 81‑03-09-22 through 81-03-09-25.

Sales Factor

The average value of owned and
rented property is assigned to
North Dakota if the property is
located in North Dakota. The amount
attributable to mobile property is
generally assignable to North Dakota
based on a ratio of the property’s
time spent in North Dakota. For more
complete information on the property
factor, see N.D. Admin. Code
§§ 81-03-09-15 through 81-03-09-21
and 81-03-09-33.
	

Line 9
Everywhere sales
Enter the corporation’s total
sales or receipts, less returns or
allowances, for the tax year. Sales
generally means all gross receipts
of a corporation. However, the types
of sales or gross receipts included
in the sales factor depend on the
nature of the corporation’s regular
business activities and may include
amounts other than sales reported
on Form 1120-S, line 1. Include on
this line the corporation’s share of the
everywhere sales from a North Dakota
Schedule K-1 (Form 58), Part 6.

Line 8
Enter the amount of total
compensation paid to employees
for the tax year. This includes gross
wages, salaries, commissions, and
any other form of remuneration paid
to the employees. Use the amount
before deductions for deferred
compensation, flexible spending plans,
and other payroll deductions. Do not
include amounts paid for employee

Line 10
North Dakota sales
For sales of tangible property, the
sale is assigned to North Dakota if
the destination of the property is
in North Dakota, regardless of the
shipping terms. For sales of other
than tangible property, the sale
is assigned to North Dakota if the
income-producing activity which gave
rise to the receipt is performed in
North Dakota.

Payroll Factor

7
Include on this line the corporation’s
share of the North Dakota sales
from a North Dakota Schedule K-1
(Form 58), Part 6. For more complete
information, see N.D. Admin. Code
§§ 81-03-09-26 through 81-03-09-31
and 81-03-09-34.
Line 11
Throwback sales
Enter the amount of sales shipped
from a location in North Dakota that
are delivered to the U.S. government
or to another state or country
where the sales are not subject to
a tax measured by income in that
jurisdiction. For more complete
information, see N.D. Admin. Code
§§ 81-03-09-29 and 81-03-09-30.
Line 14
Apportionment factor
Divide line 13 by the number of
factors having an amount greater than
zero in column 1 on lines 7, 8, and 12.
Enter the result on this line.

Instructions for
Schedule BG
(Form 60, page 2)

An S corporation that is subject to
the federal income tax on excess net
passive income or built-in gains is
subject to North Dakota income tax on
the same income and must complete
Schedule BG.
Line 4
Apportionment factor
If the corporation conducts its
trade or business both within and
without North Dakota during the
tax year (multistate corporation), it
must complete lines 1 through 14
of Schedule FACT to calculate an
apportionment factor to enter on
Schedule BG, line 4.
Line 6
North Dakota NOL deduction
If the corporation has always been
an S corporation, enter zero on
this line. However, if a corporation
changed from a C corporation to
an S corporation under an election
first made on or after January 1,
1987, it may carry forward an
unused North Dakota net operating
loss incurred while a C corporation
and deduct it from the apportioned

built-in gain subject to North Dakota
tax. Complete the Worksheet for
Schedule BG, Line 6 on page 5
to calculate the amount to enter
on this line. Attach a copy of the
worksheet to Form 60.

Instructions for
Schedule K
(Form 60, page 3)

All corporations must complete
Schedule K. The purpose of this
schedule is to show the total amount
of North Dakota adjustments, credits,
and other items distributable to its
shareholders. These items may be
applicable to the preparation of the
shareholders’ North Dakota income
tax returns.
Schedule K-1 from another
passthrough entity. Include on
the applicable lines of Schedule K
any adjustments, credits, etc., from
a North Dakota Schedule K-1, as
instructed in the partner or beneficiary
instructions to that form.
Reminder: Be sure to attach to
Form 60 any prescribed schedule
or other supporting document
specified in the instructions.
Property tax clearance
North Dakota Century Code
§ 57-01‑15.1 provides that, before
certain state tax incentives may be
claimed, a taxpayer must obtain a
property tax clearance record from
each North Dakota county in which
the taxpayer holds a 50 percent
or more ownership interest in real
property. The property tax clearance
record(s) must be attached to the
North Dakota tax return on which
the incentive is claimed. Certain tax
incentives on Form 60, Schedule K,
are subject to this requirement. The
incentives subject to this requirement
are identified in the box at the top of
Schedule K.
If the corporation is claiming any
of the specified incentives, it must
complete the property tax clearance
section at the top of Schedule K. If
the corporation is required to attach a
property tax clearance record, obtain
one by completing the form Property
Tax Clearance Record, which is
available on the Office of State Tax
Commissioner’s website.

Line 1
Interest from U.S. obligations
Enter on this line interest income from
U.S. obligations and from securities
the interest of which is specifically
exempted from state income tax by
federal statute. Include the portion of
dividend income from a mutual fund
attributable to the fund’s investment
in the same kinds of securities.
Do not enter on this line interest
income from securities of the Federal
Home Loan Mortgage Corporation
(Freddie Mac), Federal National
Mortgage Association (Fannie Mae),
or Government National Mortgage
Association (Ginnie Mae), nor from
a federal income tax refund or
repurchase agreement. Attach a
statement identifying the specific
securities from which the interest
was derived.
Line 2
Renaissance zone exemption
Enter on this line the amount from
Schedule RZ, Part 7, line 1c. Attach
Schedule RZ.
Line 3
New or expanding business
income exemption
If the corporation qualified for the
new or expanding business income
exemption under N.D.C.C.
Ch. 40-57.1, enter the exempt portion
of the corporation’s trade or business
income. See N.D. Admin. Code
§ 81-03‑01.1‑06 for guidance on
calculating the amount of the exempt
income. Attach a statement
showing the calculation of the
exempt income.
Line 4a
Renaissance zone historic
property preservation tax credit
Enter on this line the amount from
Schedule RZ, Part 7, line 4. Attach
Schedule RZ.
Line 4b
Renaissance fund organization
investment tax credit
Enter on this line the amount from
Schedule RZ, Part 7, line 5. Attach
Schedule RZ.

8
Line 4c
Renaissance zone nonparticipating

Worksheet for Schedule KS, Column 6

Enter on this line the amount from
Schedule RZ, Part 7, line 6. Attach
Schedule RZ.

	1.	Shareholder’s amount from Column 5.................................... 1	_________________

property owner tax credit

Line 5
Seed capital investment tax credit
If the corporation invested in a
qualified business for purposes of the
seed capital investment tax credit,
multiply the total amount invested
during the 2023 tax year by 45%
and enter the result on this line.
See N.D.C.C. Ch. 57-38.5. Attach a
copy of the Qualified Seed Capital
Business Investment Reporting
form. Or, if claiming a seed
capital investment credit from
a North Dakota Schedule K-1,
attach a statement identifying the
qualified business in which the
investment was made.
Line 6
Ag commodity investment tax
credit
If the corporation invested in a
qualified business for purposes of the
agricultural commodity processing
facility investment tax credit, multiply
the total amount invested during the
2023 tax year by 30% and enter the
result on this line. The corporation
is allowed no more than $250,000
in total credits for investments
made in tax years 2005 and after.
See N.D.C.C. Ch. 57-38.6. Attach
a copy of the Ag Commodity
Processing Facility Investment
Reporting form. Or, if claiming an
agricultural commodity processing
facility investment credit from a
North Dakota Schedule K-1, attach
a statement identifying the facility
in which the investment was
made.
Line 7
Biodiesel or green diesel fuel
blending tax credit
If the corporation is a licensed
supplier of biodiesel or green diesel
fuel, it is allowed a credit equal to
five cents per gallon for blending
biodiesel or green diesel fuel having
at least a 5% blend (“B5”) that meets
ASTM specifications. The blending
must be done in North Dakota. For
this purpose, a “supplier” means a
person who distributes the biodiesel

For nonresident individual shareholders only—
see instructions to Schedule KS, Column 6.

	2.	Allocable income (less related expenses) included in the
		amount on line 1................................................................. 2	_________________
	3.	Interest from U.S. obligations included in the amount on line 1. 3	_________________
	4.	Add lines 2 and 3................................................................ 4	_________________
	5.	Apportionable income (loss). Subtract line 4 from line 1........... 5	_________________
	6.	Apportionment factor from Schedule FACT, line 14................... 6	__.__ __ __ __ __ __
	7.	Multiply line 5 by line 6........................................................ 7	_________________
	8.	Allocable income (less related expenses) reportable to
		North Dakota.................................................................... 8	_________________
	9.	Add lines 7 and 8. Enter result in Column 6............................ 9	_________________

or green diesel fuel from a terminal
in North Dakota. Enter the credit on
this line. See N.D.C.C. § 57-38-01.22.
Attach a statement showing the
calculation of the credit.
Line 8
Biodiesel or green diesel fuel sales
equipment tax credit
If the corporation is a licensed seller
of biodiesel or green diesel fuel, it is
allowed a credit equal to 10% of the
costs to adapt or add equipment to
its North Dakota facility to enable it
to sell diesel fuel having at least a
2% biodiesel or green diesel blend
(“B2”) that meets ASTM specifications.
For this purpose, a “seller” means a
person who acquires the fuel from
a wholesale supplier or distributor
for resale to a consumer at a retail
location. Except for costs incurred
before January 1, 2005, include
eligible costs incurred before the tax
year in which sales of the eligible
biodiesel or green diesel fuel begin.
The credit is allowed in each of five
tax years, starting with the tax year
in which sales of the eligible biodiesel
or green diesel fuel begin. Enter the
credit on this line. See N.D.C.C.
§ 57-38-01.23. Attach a statement
showing the calculation of the
credit.
Line 9
Employer internship program
credit
If the corporation hired an eligible
college student under a qualifying
internship program set up in
North Dakota, it is allowed a credit

equal to 10% of the compensation
paid to the intern. For details,
see N.D.C.C. § 57‑38‑01.24. The
corporation is allowed no more than
$3,000 of credits for all tax years.
Line 9a. Enter the allowable credit on
this line.
Line 9b. Enter the number of eligible
interns employed during the 2023
tax year. Disregard this line if
the credit is from a passthrough
entity.
Line 9c. Enter on this line the total
compensation paid to eligible interns
during the 2023 tax year (as shown
on their 2023 Form W-2s). Disregard
this line if the credit is from a
passthrough entity.
Line 10
Research expense tax credit
A credit is allowed for conducting
qualified research in North Dakota. For
details, see N.D.C.C. § 57-38-30.5.
Enter the allowable credit on this line.
Attach a statement showing the
computation of the base amount
and the credit.
Line 11
Endowment fund tax credit
A tax credit is allowed for making a
contribution to a qualified endowment
fund. For more information,
see Schedule QEC (for filers of
Forms 38, 40, 58, and 60). Attach
Schedule QEC.
Lines 11a and 11b. Enter on these
lines the applicable amounts from
Schedule QEC.

9
Lines 11c and 11d. Enter on
these lines an endowment fund
credit and the related contribution
amount shown on a North Dakota
Schedule K-1 received from an estate,
trust, partnership, or S corporation.
Line 12
Workforce recruitment tax credit
If the corporation employs
extraordinary recruitment methods
to hire an employee to fill a hardto-fill position in North Dakota, it is
allowed a tax credit equal to 5% of
the compensation paid during the
first 12 months to the employee
hired to fill that position. The credit
may be claimed in the first taxable
year beginning after the employee
completes the first 12 consecutive
months of employment. For details,
see N.D.C.C. § 57‑38-01.25.
Line 12a. Enter the allowable credit
on this line.
Line 12b. Enter the number of eligible
employees whose first 12 months
of employment ended during the
corporation’s 2022 tax year.
Line 12c. Enter the total
compensation paid to the eligible
employees during their first 12
consecutive months of employment
ending in the corporation’s 2022 tax
year.
Line 13
Credit for wages paid to a
mobilized employee
Enter on this line the amount from
Schedule ME, line 13. See N.D.C.C.
§ 57‑38‑01.31. Attach Schedule ME.
Lines 14 through 16
Nonprofit private school tax
credits
Tax credits are allowed for making
charitable contributions to qualifying
nonprofit private primary schools,
high schools, and colleges located
in North Dakota. A separate credit
is allowed for each of the three
categories of school—primary school,
high school, and college. For each
category of school, the credit equals
50% of the contributions made to all
eligible schools within the category.
(Note: Additional limitations on
the allowable credit apply at the
shareholder level.)

For a list of the eligible schools
within each of the three
categories of schools, see the
table on page 13 of this booklet.
Election. A corporation may elect, on
a contribution by contribution basis,
to treat a contribution as having been
made during the 2023 tax year if it
is made on or before the due date,
including extensions, for filing the
2023 Form 60. Make the election by
attaching to the return a document
containing the following:
	 1.	 A statement that the election is
being made.
	 2.	 Name of qualifying school.
	 3.	 Date of contribution.
	 4.	 Amount of contribution.
To qualify, a contribution must be
made directly to, or specifically
designated for the exclusive use of, a
qualifying school.
School network or organization.
If a contribution is made payable
to the account or fund of a school
network or organization that governs
or benefits multiple schools, the
contribution will qualify only if the
corporation specifically designates
it for the use of a qualifying school,
and the network or organization
separately accounts for the funds on
behalf of that school. The corporation
must obtain a statement from the
network or organization that identifies
the qualifying school and the amount
contributed to it. If the qualifying
school falls into both the primary and
high school categories, also see the
next paragraph.
Schools in both primary and high
school categories. If a contribution
is made to a qualifying school that
provides education in one or more
grades in both the primary school
category (kindergarten through
8th grades) and the high school
category (9th through 12th grades),
a separate credit is allowed for the
portion of the contribution designated
for use within each school category.
The corporation must obtain a
statement from the qualifying school
or the school network or organization
that identifies the qualifying school
and shows the amount contributed

within each category of school. If
the corporation does not obtain a
statement, one-half of the total
contribution will be deemed to have
been made to each category of school.
Line 14. Enter on this line the
allowable credit for contributions to
qualified nonprofit private primary
schools.
Line 15. Enter on this line the
allowable credit for contributions
to qualified nonprofit private high
schools.
Line 16. Enter on this line the
allowable credit for contributions to
qualified nonprofit private colleges.
Line 17
Angel investor investment credit
Important! This line is only for
credits attributable to investments
made in qualified businesses
by angel funds organized and
certified on or after July 1, 2017.
If an S corporation is a member of
a North Dakota angel fund that is
organized and certified on or after
July 1, 2017, a credit is allowed to
the corporation if it participates in
a qualified investment made by the
angel fund in a qualified business.
The angel fund is required to provide
a Participating Angel Investor
Statement to the S corporation,
which evidences the corporation’s
investment. For qualified investments
made after June 30, 2017, that fall
into the S corporation’s 2023 tax year,
multiply the investment amount by
the applicable credit rate shown on
the statement. If an S corporation
participates in more than one qualified
investment during the tax year,
calculate the credit separately for
each Participating Angel Investor
Statement received and add the
separately calculated amounts.
Enter the credit amount on this
line. Do not enter on this line
an angel investor credit from a
North Dakota Schedule K-1. See
N.D.C.C. § 57-38-01.26 (effective
for investments made after June 30,
2017).
Attach a copy of the Participating
Angel Investor Investment
Statement.

10
Line 18
Automation tax credit
If the corporation qualified for the
automation tax credit under N.D.C.C.
§ 57-38-01.41, enter on this line the
amount of the credit shown on the
credit approval letter issued to the
corporation by the North Dakota Office
of State Tax Commissioner.
Line 19
Credit for hiring an individual
with a developmental disability or
mental illness
A tax credit is available for employing
an individual with a developmental
disability or mental illness. To
qualify, an employer must apply for
and obtain certification from the
North Dakota Department of Human
Services, Vocational Rehabilitation
Division, that the individual has a
severe disability, is eligible for the
agency’s services, and requires
customized or supported employment
to become employed. The credit is
equal to 25% of the wages paid to the
individual during the tax year, up to a
maximum credit of $1,500 per year.
The credit is allowed for each eligible
individual hired. Attach a copy
of the certification letter from
Human Services.
Line 20
Maternity home, child placing
agency, or pregnancy help center
tax credit
A tax credit is allowed for
contributions to the following
organizations: (1) a child placing
agency licensed by the North Dakota
Department of Health and Human
Services (DHS), (2) a nonprofit
maternity home located in
North Dakota, or (3) a pregnancy help
center recognized by DHS.
The credit is equal to 100% of the
contribution and is limited to 50% of
a taxpayer’s tax liability. Enter on this
line the amount from Schedule MCP,
line 8. Attach Schedule MCP.
The credit is available to corporations,
individuals, estates, trusts, and
passthrough entities. A tax credit
earned by a passthrough entity is
passed through and allowed to each
owner in proportion to their respective
interests in the passthrough entity.
Unused credit. There is no carryover
provision to succeeding tax years.

Line 21
Apprentice tax credit
A tax credit is available for
compensation paid by a corporation
to an apprentice. The credit equals
10% of the stipend or salary paid to
a qualified apprentice employed in
North Dakota. The apprentice must be
in an apprenticeship program certified
by the U.S. Department of Labor or
be an electrical apprentice registered
under North Dakota law. The credit
is allowed for up to 5 apprentices
employed by the corporation at the
same time.
Lifetime credit limit. A corporation
is allowed no more than $3,000 in
total tax credits for eligible wages paid
in all tax years.
Line 21a. Enter the allowable credit
on this line.
Line 21b. Enter the number of
eligible apprentices employed during
the 2023 tax year.
Line 21c. Enter the total amount
of wages, salaries, or other
compensation paid to eligible
apprentices employed during the 2023
tax year (as shown on their 2023
Form W-2’s).
Line 22
Allocable nonbusiness income
Lines 22a and 22b apply only if the
corporation meets all of the following:
	 •	 It is a multistate corporation, i.e.,
it carries on its business both
within and without North Dakota.
	 •	 It has one or more nonresident
individual, estate, or trust
shareholders.
	 •	 It has allocable nonbusiness
income. Generally, all income
received by a corporation is
considered business income unless
clearly classifiable as nonbusiness
income. The classification of
income by the labels used to
describe it—for example, interest,
dividends, rents, royalties,
operating income, or nonoperating
income—is generally not relevant
in determining whether income is
business or nonbusiness income.
For more information, see N.D.
Admin. Code § 81-03-09-03.

Nonbusiness income is not
apportioned using the apportionment
factor (from Schedule FACT) but
is allocated within or without
North Dakota as provided under
N.D.C.C. §§ 57-38.1-04 through
57-38.1‑08 and N.D. Admin. Code
§ 81‑03‑09‑09. Expenses must be
attributed to the nonbusiness income
in a manner that fairly distributes all
of the corporation’s expenses to its
business and nonbusiness income.
If the corporation has an item of
nonbusiness income subject to
allocation, the corporation must take
this into account when calculating
the North Dakota distributive share
of income or loss reportable on
Schedule KS and Schedule K-1
(Form 60). See the instructions to
Schedule KS, Column 6, for more
information. In addition to completing
lines 22a and 22b, the corporation
must attach the following to Form 60:
	 •	 A statement on which each item
of nonbusiness income is shown
along with its related expenses.
	 •	 A statement explaining the basis
for treating the item of income
as nonbusiness income subject to
allocation.
	 •	 If an item of nonbusiness income
is allocated to a state other than
North Dakota, a copy of that other
state’s income tax return must
be attached. If the corporation is
not required to file an income tax
return with the other state, the
corporation must indicate this in
the attached statement.
Line 22a. Enter the total allocable
income (less related expenses)
from all sources within and without
North Dakota.
Line 22b. Enter the portion of the
amount on line 22a that is allocable to
North Dakota.
Line 23
Disposition of I.R.C. Section 179
property
Lines 23a through 23d apply only if
the corporation sold, exchanged, or
disposed of property for which an
I.R.C. Section 179 deduction was
passed through to the shareholders.

11
Note: The corporation is required
to report this same information on
a separate statement attached to
Federal Form 1120-S, Schedule K,
line 17d.
For lines 23a through 23d, multiply
the corresponding combined
amount for all shareholders as
reported on Federal Form 1120‑S,
Schedule K, line 17d, by the
North Dakota apportionment factor
from Schedule FACT, line 14, and
enter the result. However, if the
property disposed of is treated as a
nonbusiness asset the gain or loss
from which is subject to allocation
under N.D.C.C. §§ 57-38.1-04 through
57-38.1-08, subtract the amounts
for that asset before multiplying by
the apportionment factor. Include the
nonbusiness gain or loss from the
disposition on Form 60, Schedule K,
line 22.

Instructions for
Schedule KS
(Form 60, page 5)

Schedule KS must be completed
to provide information about each
shareholder. If the corporation has
more than seven shareholders,
complete and attach additional
schedules as needed to list all
shareholders. If more than one
Schedule KS is needed, complete
lines 1 through 4 on only one of them,
and include the combined amount
for all of the schedules on that one
schedule.

All Shareholders

(Columns 1 through 5)
Columns 1 and 2
Enter the name, mailing address, and
shareholder’s identifying number as
shown on the shareholder’s Federal
Schedule K-1. If the shareholder
is a single member limited liability
company (LLC) that is a disregarded
entity for federal income tax purposes,
enter the owner’s name, address, and
identifying number.
Column 3
Identify the entity type of the
shareholder by entering the applicable
code letter as follows:

Entity type	

Code letter

Individual...................... I
Trust............................. T
Decedent’s estate........... D
Bankruptcy estate.......... B
Exempt organization....... O
If the shareholder is a limited liability
company (LLC) that is a disregarded
entity for federal income tax purposes,
enter the code letter for the type of
entity of the LLC’s owner.
Note: The “Trust” entity type applies
to a trust that files Federal Form 1041
or, in lieu of filing Federal Form 1041,
elects an alternative reporting
method under the federal income tax
regulations and to an IRA (generally
filing Federal Form 990-T to report
Unrelated Business Taxable Income).
Column 4
Enter the shareholder’s stock
ownership percentage as shown
on the shareholder’s Federal
Schedule K-1.
Column 5
Enter the sum of the following items
from the shareholder’s Federal
Schedule K-1 (Form 1120-S), Part III:
Box 1	

Ordinary business income
(loss)

Box 2	

Net rental real estate income
(loss)

Box 3	

Other net rental income
(loss)

Box 4	

Interest income

Box 5a	 Ordinary dividends
Box 6	

Royalties

Box 7	

Net short-term capital gain
(loss)

Box 8a	 Net long-term capital gain
(loss)
Box 9	

Net section 1231 gain (loss)

Box 10	 Other income (loss)
Box 11	 Section 179 deduction
Box 12	 Other deductions (Only
include the deductions
allowed as a deduction
from gross income in
calculating adjusted gross
income for federal income
tax purposes.)

Box 17	 Include the gain (loss) from
I.R.C. Section 179 property
disposition (For purposes
of calculating the gain
or loss, include all of the
Section 179 deduction
passed through to the
shareholder, regardless
of whether or not the
shareholder actually
deducted all of it.)

Nonresident Shareholders
Only
(Columns 6 through 8)

For purposes of Columns 6 through 8,
a nonresident shareholder means:
	 •	 an individual who is not domiciled
in North Dakota, or
	 •	 a trust, including a grantor trust,
that is not organized under
North Dakota law. This only applies
to trusts that are subject to income
tax.
Column 6
Complete Column 6 for each
nonresident shareholder. Multiply the
shareholder’s amount in Column 5
by the apportionment factor from
Schedule FACT, line 14, and enter the
result in Column 6. However, complete
the Worksheet for Schedule KS,
Column 6 on page 8 to calculate the
amount to enter in Column 6 if either
or both of the following apply:
	 •	 The corporation has an item of
nonbusiness income subject to
allocation. See the instructions to
Form 60, Schedule K, line 20, for
more information.
	 •	 The amount in Column 5 includes
interest from U.S. obligations.
Column 7
If a nonresident shareholder’s
distributive share of North Dakota
income in Column 6 is $1,000
or more, multiply the amount in
Column 6 by 2.50% (.025) and enter
the result in Column 7. However, the
following exceptions apply:
	 •	 If the nonresident shareholder
gives you a completed Form PWA,
enter the amount from line 5 of
Form PWA in Column 7 and fill
in the circle under “Form PWA or
Form PWE.”

12
	 •	 If the nonresident shareholder
elected to be included in a
composite filing, leave Column 7
blank and see the instructions to
Column 8.
See “Withholding from nonresident
shareholders” on page 3 for more
information.
Column 8
Note: Leave Column 8 blank if
Column 7 was completed for the
nonresident shareholder.
Complete Column 8 for each
nonresident shareholder electing to
be included in a composite filing.
Multiply the amount in Column 6 by
2.50% (.025) and enter the result in
Column 8. If the amount in Column 6
is zero or less, enter zero in Column 8.
See “Composite filing” on page 3 for
more information.

Specific line
instructions for
page 1 of Form 60,
lines 1-13
Complete Schedule FACT,
Schedule BG, Schedule K, and
Schedule KS before completing
lines 1 through 13 on page 1 of
Form 60.
Line 5
Income tax withholding
Enter the North Dakota income
tax withholding shown on a 2023
Form 1099 or North Dakota
Schedule K-1. Be sure the state
identified on the Form 1099 is
North Dakota. Also enter the
North Dakota income tax withholding
shown on a 2022 North Dakota
Schedule K-1 if the entity that issued
it has a fiscal tax year ending in
the corporation’s 2023 tax year. Do
not enter on this line North Dakota
extraction or production taxes
withheld from mineral interest
income, such as an oil or gas royalty,
because they are not income taxes.
Attach a copy of the Form 1099 or
North Dakota Schedule K-1.

Line 6
Estimated tax payments
Enter the amount paid with the
2023 Forms 60-EXT and 60-ES plus
any overpayment applied from the
2022 Form 60. However, if filing an
amended return, do not enter any
previously paid estimated tax amount;
instead, enter the amount of the total
taxes due from line 4 of the previously
filed original or amended return.
Line 9
Application of overpayment to
2024
If there is an overpayment on line 8,
the corporation may elect to apply
part or all of it as an estimated
payment toward its 2024 tax liability.
To make the election, enter the
portion of line 8 to be applied on
line 9. If this election is made, the
election and the amount applied may
not be changed after the return is
filed. If this is an amended return, do
not make an entry on this line.
Line 11
Tax due
A tax due must be paid in full with
the return when it is filed. See the
instructions to line 13 for payment
options.
Line 12
Penalty and interest
The Office of State Tax Commissioner
will notify the corporation of any
penalty and interest payable on a tax
due shown on Form 60. However, the
corporation may calculate the penalty
and interest amounts and include
them in the balance due on Form 60.
Penalty. Calculate the penalty
amount as follows:
	 •	 If Form 60 is filed by the due date
(or extended due date), but the
total amount of tax due is not paid
with the return, the penalty is
equal to 5% of the unpaid tax or
$5.00, whichever is greater.
	 •	 If Form 60 is filed after its due
date (or extended due date), and
there is an unpaid tax due on it, a
penalty equal to 5% of the unpaid
tax due (with a $5.00 minimum)
applies for the month the return
was due, plus 5% of the unpaid
tax due (with a $5.00 minimum)
for each month or fraction of a

month the return remains unfiled,
not to exceed the greater of 25%
of the unpaid tax due or $25.00.
Interest. Calculate the interest
amount as follows:
	 •	 If an extension of time to file
Form 60 was obtained, extension
interest is calculated at the rate of
12% per year on any tax due from
the due date of the return to the
earlier of the extended due date or
the date the return was filed.
	 •	 If the total amount of tax due
is not paid by the due date (or
extended due date) of the return,
interest is calculated at the rate
of 1% per month or fraction of a
month on the unpaid tax, except
for the month in which the return
was due.
Line 13
Balance due
The balance due must be paid in full
with th