Minnesota North Dakota Reciprocity Agreement

Minnesota has reciprocal agreements with Michigan and North Dakota. You are not subject to Minnesota income tax if, 2020: If you are allowed to benefit from reciprocity under North Dakota income tax Mutual income tax, but your employer will keep North Dakota income tax on the wages you earn in North Dakota, you must file a North Dakota income tax return to claim a refund of that deduction. For forms or assistance to your application, please contact the Tax Commissioner of the North Dakota State Office at 701.328.1247 or visit our website. If you continue to work in North Dakota and continue to benefit from reciprocity, you can end the North Dakota income tax withholding tax on the wages you earn in North Dakota by filling out the NDW-R form and passing it on to your employer. If you have received reciprocal wages and your employer has withheld income tax from Minnesota or Montana, you must file a non-resident tax return with the state concerned to obtain a refund of the amount withheld. Reciprocity prevents both states from taxing the same “personal service income” (wages, salaries, tips, commissions, fees or bonuses). As a general rule, only your country of origin imposes the personal income you receive from an employer in a mutual state. If this happens, you will only have to file a refund in your home country and not in both cases. The wages you received to work in North Dakota are subject to income tax in North Dakota, unless they are exempt under the income tax reciprocity agreement between North Dakota and Minnesota. Beginning in September 1975, the states of Minnesota and North Dakota reached an agreement on reciprocity of tuition fees. This means that legal residents of Minnesota and their loved ones can go to North Dakota State University and pay a lower education rate than the non-resident. The Minnesota Office of Higher Education determines whether a student is eligible. While waiting for reciprocity, students must pay the Midwest Student Exchange Program (MSEP/MHEC) education fee, which is higher than the MN-Resident rate.

Minnesota`s reciprocity education rate is only granted to students who have been licensed by the Minnesota Office of Higher Education and who are applied for the current mandate and simultaneous future conditions. If you live in Minnesota, you can file an income tax return with the mutual government for a refund of the withheld tax. In addition, you must file an income tax return for Minnesota if you meet the minimum reporting requirement for the year. You may not need a Michigan or North Dakota income tax that is withheld for personal services that have been obtained in these countries. For more information, visit the tax department of the mutual state. Compensation that a Minnesota resident receives for personal or professional services in North Dakota is exempt from income tax in North Dakota under the reciprocity agreement, if the person owns a permanent home in Minnesota, to which the person returns at least once a month while performing services in North Dakota. “Personal or professional compensation” includes salaries, salaries, tips and commissions an employee receives from an employer and, in limited cases, distributions of a partnership. If your wages are reciprocal and you do not want your employer to withhold Minnesota tax in the future, MWR form form, Reciprocity Exemption/Affidavit of Residency, every year with your employer.