Updated October 4, 2026. Quick answer: Yes. North Dakota taxes 401(k) and IRA withdrawals that are in federal adjusted gross income, because Form ND-1 starts from “Federal adjusted gross income from Form 1040 or 1040-SR, line 11”. The booklet lists no exclusion for private 401(k) or IRA accounts, and its tax is graduated at 0.00%, 1.95% and 2.50%.
More state retirement-income schedules, line by line: North Dakota ND-1 retirement lines.
Inherited an IRA? What the state’s own documents say about taxing those withdrawals: North Dakota tax on inherited IRA withdrawals.
Hold a 403(b) or 457(b)? What the state’s own documents say about taxing those withdrawals: does North Dakota tax 403(b) and 457(b) withdrawals.
Withdrawing from an IRA or 401(k)? Whether the state withholds tax from it, from its own documents: North Dakota tax withholding on IRA and 401(k) withdrawals.
Inheriting from, or planning for, someone in this state? Whether the state has an inheritance tax, from its own tax documents: Does North Dakota have an inheritance tax?.
What North Dakota does with 401(k) and IRA withdrawals
The booklet lists the “Taxable portion of IRAs, pensions” among the federal income it starts from. Its exclusions are for a “Military Retirement Benefit”, where “Certain retirement benefits of a licensed peace officer are excludable”, and “benefits received from the U.S. Railroad Retirement Board”, which are not private accounts. The documents do not discuss Roth treatment.
| Item | What the documents say |
|---|---|
| Treatment | Taxable; no private 401(k) or IRA exclusion printed |
| Exclusions printed | Military retirement, licensed peace officer retirement benefits, Railroad Retirement Board benefits, Social Security |
| State rates, 2025 | 0.00% up to $48,475 (single), 1.95% to $244,825, 2.50% above |
| Source | North Dakota Office of State Tax Commissioner, 2025 booklet and Form ND-1 |
A $40,000 withdrawal
All $40,000 of a traditional withdrawal is part of federal adjusted gross income. If $40,000 were a single filer’s whole North Dakota taxable income, it falls under the $48,475 zero-rate band, so North Dakota tax on it is $0. Income above $48,475 pays 1.95%.
What changes in 2026
The documents read print no 2026 rate schedule or exclusion change.
Federal rules
The state’s treatment sits on top of the federal one. The IRS explains the federal tax on these withdrawals in Publication 590-B, Distributions from Individual Retirement Arrangements and Publication 575, Pension and Annuity Income.
Related: whether North Dakota taxes pensions, how North Dakota taxes retirement income, whether North Dakota taxes Roth conversions, and the state-by-state table of 401(k) and IRA withdrawal tax.
Find the right next step for your situation
About how much do you have invested? Pick the range that fits; your next step appears immediately below.
Compare vetted advisors for retirement withdrawals
If your portfolio is $250,000 or more, this connects you (free, with no obligation to hire anyone) with 2 to 3 vetted advisors.
Before you start, what actually happens. The matching service is run by WiserAdvisor, an independent advisor-matching company. It opens on their site, asks for your ZIP code and a few questions, and matches you with 2 to 3 vetted advisors. It is free to you.
WiserAdvisor states the service is built for portfolios of $250,000 and above. By submitting, you consent to emails, phone calls and text messages from WiserAdvisor and up to three advisors, so expect to be contacted. Clear Money Guide may earn a referral payment for a qualifying completed form, whether or not you ever hire anyone.
Opens on WiserAdvisor’s site in a new tab.
See how an advisor plans your withdrawals
Price the destination before you decide. The matching service below introduces you to advisers who pay to meet you.
Before you start, what actually happens. The form is run by Kapitalwise, our advisor-matching partner. Kapitalwise sends your details to advisers who pay for the introduction, so expect calls and texts. Clear Money Guide may earn a referral payment through this service, whether or not you ever hire anyone. This is free to you and there is no obligation to hire anyone.
The Kapitalwise form opens here; you stay on this page.
What happens when you press the button
It asks about nine questions: age, investable assets, location; then your name, email and phone number, and verifies the phone by text. Nothing loads and nothing reaches Kapitalwise until you press the button.
Prefer flat-fee or hourly pricing instead? Compare ranges here.
Answer againSources
- 2025 Individual Income Tax Booklet: https://www.tax.nd.gov/sites/www/files/documents/forms/individual/2025-iit/2025-individual-income-tax-booklet.pdf
- Individual Income Tax (tax rates, 2025 tax year): https://www.tax.nd.gov/individual-income-tax
- Form ND-1 (Individual Income Tax Return), 2025: https://www.tax.nd.gov/sites/www/files/documents/forms/individual/2025-iit/28702-form-nd-1-2025.pdf
Sources: the primary documents linked above, read on October 4, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the plan administrator or the agency itself is the right place to confirm anything consequential.