Does North Dakota Tax Retirement Income?

No. North Dakota does not tax Social Security benefits.

Social Security benefits included in federal taxable income are deducted in full. The income limits that applied when the deduction started in 2019 were removed for tax years 2021 and after.

The North Dakota answer is separate from the federal one. Depending on combined income, up to 85% of Social Security benefits can be taxable on the federal return regardless of what North Dakota does, so the state rule changes the state line only. Our guide to states that do not tax Social Security shows where North Dakota sits among the states that still tax benefits.

Yes. North Dakota generally taxes pension income.

Public and private pensions are taxable, but at 0% up to the first bracket threshold, 1.95% in the middle bracket, and 2.5% only above roughly a quarter million dollars of taxable income.

The zero bracket does the work of an exclusion. For 2026, taxable income up to $49,575 (single) or $82,800 (married filing jointly) is taxed at 0%, income above that up to $250,400 (single) or $304,850 (joint) at 1.95%, and the rest at 2.50%. Because North Dakota starts from federal taxable income, the federal standard deduction and the age-65 addition are already removed before these thresholds apply.

Public and private pensions, annuities, and retirement-plan distributions do not always get the same treatment. The pension comparison lists which states exempt pensions broadly, partly, or only for certain plans.

Yes. North Dakota generally taxes traditional 401(k) and IRA withdrawals.

Traditional 401(k) and IRA withdrawals are taxable as part of federal taxable income, which is North Dakota's starting point.

Two timing points matter in North Dakota. A Roth conversion is taxable in the year it is done, and North Dakota starts from federal adjusted gross income, so a large conversion can land in a year when the state exclusion does not cover it. Qualified Roth withdrawals later are generally not taxable at either level. Required minimum distributions follow the same North Dakota rules as any other traditional-account withdrawal.

Every state page on this site runs the same retiree profile so the states can be compared: $30,000 of Social Security, $40,000 withdrawn from a traditional 401(k), and a $20,000 private pension, $90,000 in total.

A single 68-year-old with $30,000 of Social Security, $40,000 from a 401(k), and a $20,000 private pension starts with federal taxable income of roughly $61,000, deducts the $25,500 of taxable Social Security, and lands near $36,000 of North Dakota taxable income. That is inside the $49,575 zero bracket, so the state tax is $0.

Federal AGI is about $85,500; after the $18,150 federal standard deduction for a single filer age 65 and the $6,000 federal senior deduction, if it applies, federal taxable income is roughly $61,350. North Dakota then subtracts the $25,500 of Social Security, leaving roughly $35,850, which is below the $49,575 top of the 0% bracket, so the North Dakota tax is $0. Even without the federal senior deduction, taxable income of roughly $41,850 is still inside the zero bracket. Contrast: a $150,000 lump-sum IRA withdrawal raises North Dakota taxable income to roughly $186,000, and the 1.95% rate on the amount above $49,575 produces roughly $2,650 of tax; a married couple filing jointly with the same $150,000 withdrawal would pay roughly $2,000 because their zero bracket runs to $82,800.

The same $90,000 profile looks different a state line away. The rows below come from the reviewed 51-state table; each state name links to its own guide.

• South Dakota: has no individual income tax at all.
• Minnesota: treats Social Security as partially taxed, pensions as taxed, and 401(k) and IRA withdrawals as taxed, with a top rate of 9.85% and income-based Social Security subtraction.
• Montana: treats Social Security as partially taxed, pensions as partially taxed, and 401(k) and IRA withdrawals as partially taxed, with a top rate of 5.65% and up to $5,500 qualified retirement subtraction.

Tables that mark North Dakota pensions and IRAs as "taxed" are technically right and practically wrong for most retirees. A couple can take roughly $80,000 of pension and IRA income after Social Security and their federal deductions and still owe zero.

Military retirement: Military retirement benefits paid to retired members of the armed forces or reserves, and to surviving spouses, are fully deductible, a deduction created in the 2019 session. Active-duty and reserve military pay has been fully deductible since tax year 2023. See the military retirement tax map for every state's treatment.

Estate and inheritance tax: North Dakota has no estate or inheritance tax.

Selling a home or investments in North Dakota: retirement-income rules do not cover capital gains. See North Dakota capital gains tax before selling appreciated property or a brokerage position in the year you move or retire.

• Confirm the exclusion you are claiming. The zero bracket does the work of an exclusion. For 2026, taxable income up to $49,575 (single) or $82,800 (married filing jointly) is taxed at 0%, income above that up to $250,400 (single) or $304,850 (joint) at 1.95%, and the rest at 2.50%. Because North Dakota starts from federal taxable income, the federal standard deduction and the age-65 addition are already removed before these thresholds apply.
• Part-year residents. If you moved into or out of North Dakota during the year, retirement income is generally allocated to the period of residency, and the former state may still tax distributions received before the move. Document the move date, the new domicile, and where each distribution was received.
• Withholding and estimates. Pension and IRA custodians often withhold federal tax but not North Dakota tax. If North Dakota taxes any part of your retirement income, check whether quarterly estimated payments are needed to avoid an underpayment penalty.
• Federal side. The federal return has its own rules: up to 85% of Social Security can be taxable, the temporary $6,000 federal senior deduction is available for 2025 through 2028 subject to income limits, and Roth conversions are taxed in the conversion year. State exemptions do not change any of that.
• Large one-time distributions. Fill the zero bracket every year. A retiree with taxable income under $49,575 (single) or $82,800 (joint) can do a Roth conversion up to that line at a 0% North Dakota rate, which is close to a free state conversion; the only cost is the federal tax.

Comparing states before a move? Use the retirement taxes by state table and the moving states tax guide, and read retirement tax planning for how distributions, conversions, and a move are sequenced together.