HB 1118 Summary

• Creates a new individual income tax credit allowing residents to claim up to $800 (single filers) or $1,600 (joint filers) as a nonrefundable credit against state income tax liability, effective for taxable years beginning after December 31, 2022.

• Amends the individual income tax rate structure to clarify that the flat tax rate of 1.99% applies to North Dakota taxable income for individuals, estates, and trusts under the existing rate schedules.

• Repeals the marriage penalty credit under section 57-38-01.28, replacing it with the broader individual income tax credit available to all resident taxpayers.

• Modifies rounding rules for tax calculations to reference the updated section numbers for tax tables and applicable rounding procedures.

• Effective for taxable years beginning after December 31, 2022.