North Dakota Tax Law

Tax laws are in place to govern how the federal, state, and local governments calculate owed taxes. Some examples of what these legal rules and procedures can cover include, but are not limited to:

• Income taxes;
• Corporate taxes;
• Excise (i.e. taxes that are taxed on manufacturers at the time of manufacture, instead of taxing customers at the
• time of sale) and luxury taxes;
• Estate taxes; and
• Property taxes.

The Internal Revenue Code is what forms the foundation of United States federal tax law. The Code contains subtitles which provide information and regulation regarding the different types of federal taxes, and are considered to be the ultimate authority regarding federal taxes. As such, all tax forms and instructions are based on the Internal Revenue Code (“IRC”). The rules governing procedures and administrative processes are also clarified in the IRC, as both taxpayers and the IRS must adhere to these rules.

Federal tax law also consists of regulations issued by the Department of Treasury that are intended to interpret each code section by providing extensive examples and explanations.

At the state and local levels, state governments maintain their own tax codes which are intended to serve the same purpose as the IRC does for the federal level. Not every state has an income tax, but each state assesses other types of taxes. Some examples of such taxes would be sales taxes, property taxes, and inheritance taxes. As they are created by each individual state, they are considered to be separate and distinct from federal tax law. What this means is that state governments maintain their own tax codes. Tax laws may even exist at the county and city levels as well.

Simply put, tax laws cover subjects such as:

• How taxable amounts are determined;
• How taxes are to be collected;
• Where those collected taxes should be allocated; and
• How violations of tax laws are to be addressed.

What Are Some Common Tax Law Conflicts?

Two of the most common issues that can lead to tax law conflicts are tax evasion, and disputes between taxpayers and the IRS.

Tax evasion refers to a situation in which a taxpayer deliberately and intentionally underpays their owed taxes. This may be an individual, corporation, or trust. The taxpayer generally accomplishes this by misrepresenting their financial status so that their tax liability is reduced. One way to commit tax evasion would be by declaring lower amounts of income, profits, and/or gains than what was actually earned. Another example of tax evasion would be overstating any deductions that they may qualify for.

Due to the fact that tax law is complex, and is constantly changing, disputes between taxpayers and the IRS are not uncommon. In addition to the federal tax laws as part of Title 26 of the U.S. Code, there are:

• Other federal tax laws that are contained within Title 26 of the Code of Federal Regulations;
• Rules that are recommended by the Internal Revenue Service (“IRS”);
• Revenue rulings rendered by the IRS;
• Private letter rulings provided by the IRS;
• Releases issued by the IRS; and
• Decisions rendered by the federal tax court.

The U.S. Tax Court hears cases involving disputes between taxpayers and the IRS, when underpaid taxes are the core issue. Although the U.S. Tax Court is located in Washington, D.C., its judges travel all over the country in order to preside over trials. Once a decision has been rendered by the Tax Court, the Federal District Court of Appeals can hear any appeals that are being made in connection with the ruling. The U.S. Supreme Court has final review and jurisdiction over the case.

What Are Some Different Types of Tax Law Attorneys?

There are many different types of tax law attorneys, as there are many different types of tax law. Some examples include, but are not limited to:

• Business Tax Lawyers: The amount of taxes paid by each business, as well as the type of taxes and rates applied, will depend on the particular type of business. All business owners must be aware of their tax obligations, and when their taxes are due. If a business owner does not pay when due, they may encounter excessive fines and penalties. A business tax attorney can help you as a business owner understand what taxes you will need to pay, and when;
• Personal Income Tax Lawyers: Income tax is a specific type of tax which may increase as the person’s income increases. Income tax lawyers specialize in filing income taxes for both individuals and businesses, and can also advise clients on complex tax issues. Income tax lawyers handle disputes before the Internal Revenue Service and state taxing agencies get involved;
• Property Tax Lawyers: Property taxes are assessed on property you own, and are generally taxed on an annual or quarterly basis. However, some states also tax personal property, such as your motor vehicle. A real estate attorney can help property owners determine when their taxes are due, how much those taxes will be, and how to resolve any disputes that may arise associated with paying property taxes;
• International Tax Lawyers: International tax law governs how taxes are to be paid by United States citizens who are receiving an income from foreign countries. Additionally, international tax governs how foreign nationals and foreign corporations are taxed when receiving their income in the United States. As you can imagine, tax laws regarding international taxes are especially complex; an international tax lawyer can help you understand how those laws apply to you, and how you can adhere to them; and
• Tax Fraud Lawyers: Tax fraud occurs when a taxpayer has willfully and intentionally falsified information on their tax return, in order to avoid paying their entire tax obligation. This is a violation of the tax code, and can include preparing a filing a false return, among other things.

Any tax law attorney can assist you if you are being audited. This is a systematic review of an individual’s or business’ accounts and financial information in order to determine whether tax information has been provided as required by federal tax laws. It is important to note that being audited does not always mean that an error has been found.

Does North Dakota Have Any Special or Unique Tax Laws?

In terms of tax laws, most states have similar laws and guidelines as any other. North Dakota maintains tax laws and regulations for the following subjects:

• Aircraft excise tax;
• Coal severance tax;
• Farm machinery gross receipts tax;
• Aviation fuel tax;
• Musical composition performing tax;
• Renaissance zones;
• Statements of Full Consideration; and
• Telecommunications Carrier Taxation.

It is important to note that this is not an exhaustive list of North Dakota’s special or unique tax laws. Rather, these are a few examples.

Should I Hire a North Dakota Tax Attorney For Assistance?

If you have any questions regarding your taxes in North Dakota, you should consult with a local tax attorney. An experienced local North Dakota tax attorney can assist from the very beginning by helping you determine what sort of taxes you will need to pay, and what state laws you may need to adhere to. Further, should any disputes arise, your attorney will also be able to represent you in court, as needed.