How North Dakota capital gains tax works
North Dakota does not have a separate capital gains rate. Gains are taxed as ordinary income, stacking on top of your other earnings.
Because of that stacking, a large gain can push part of your income into a higher bracket, so the rate on the gain depends on your total income for the year.
North Dakota excludes 40% of net long-term capital gains from tax.
Short-term vs long-term gains
Federally, assets held longer than a year qualify for lower long-term rates. Most states, including North Dakota, do not offer a separate long-term rate.
This calculator estimates the ND state tax by adding the gain to your other income and measuring the extra tax — your true marginal cost.
Lowering the bill
Holding assets longer, harvesting losses to offset gains, and spreading sales across tax years can all reduce what you owe.
Remember this shows North Dakota state tax only; federal capital gains tax applies on top. Verify with the North Dakota Office of State Tax Commissioner (tax.nd.gov).
Frequently asked questions
Does North Dakota tax capital gains?
Yes — North Dakota taxes capital gains as ordinary income, so the rate depends on your total income.
What is the capital gains tax rate in North Dakota?
Gains are taxed at your North Dakota income tax rate, up to 2.50%, since there is no separate capital gains rate.
Are long-term gains taxed lower in North Dakota?
North Dakota excludes 40% of net long-term capital gains from tax.
Does this include federal capital gains tax?
No. This estimates the ND state tax only. Federal capital gains tax is separate and applies on top.