North Dakota Administrative Code Title 81 - Tax Commissioner
Overview: Title 81 — Tax Commissioner
Title 81 of the NDAC sets forth the administrative rules promulgated by the North Dakota Tax Commissioner. These rules govern the administration and enforcement of the state’s tax laws. The Tax Commissioner is the chief executive officer responsible for overseeing tax collection, audits, appeals, compliance, and enforcement related to state taxes.
Statutory Authority
The Tax Commissioner’s authority is derived from various chapters of the North Dakota Century Code (NDCC), primarily Chapter 57-01 (General Tax Administration), as well as other tax-specific chapters (e.g., sales tax, income tax).
Title 81 implements the Commissioner’s power to issue rules, conduct audits, collect taxes, assess penalties, and hear appeals.
Key Areas Covered in Title 81
1. Tax Administration Procedures
The rules establish procedures for filing tax returns, payments, extensions, and refunds.
They provide instructions on when and how taxes must be paid, including electronic filing requirements.
The Commissioner may require specific forms and documentation to be submitted.
2. Audits and Investigations
Title 81 outlines the procedures for conducting tax audits, including:
How taxpayers are notified of audits.
The scope and timing of audits.
Rights and responsibilities of taxpayers during audits.
Access to records and cooperation with auditors.
The Commissioner has authority to examine books, records, and other relevant data.
Taxpayers have the right to appeal audit findings.
3. Appeals and Hearings
The Tax Commissioner’s rules specify how taxpayers can appeal assessments or denials.
Initial appeals are made to the Commissioner’s office, sometimes involving informal conferences.
Formal contested case hearings follow the North Dakota Administrative Procedure Act.
Final decisions can be appealed to the North Dakota Tax Commissioner’s appeal tribunal or the district court.
These procedures ensure due process rights for taxpayers.
4. Penalties and Interest
The rules describe penalties for late filing, late payment, failure to keep records, or fraudulent tax returns.
Interest accrues on unpaid taxes as provided by statute.
The Commissioner has discretion to waive penalties or interest in certain circumstances, as set forth in the rules.
Enforcement powers include liens, levies, and other collection tools.
5. Tax Credits and Incentives
Title 81 contains provisions implementing statutory tax credits and incentives, explaining eligibility and application procedures.
The Commissioner administers and audits these programs to prevent abuse or fraud.
6. Confidentiality and Disclosure
The Commissioner is bound by rules protecting taxpayer confidentiality.
Disclosure of taxpayer information is limited and governed by statute.
Exceptions exist for law enforcement or pursuant to court orders.
Relevant Case Law Involving the Tax Commissioner and Title 81
North Dakota courts have occasionally reviewed decisions by the Tax Commissioner or addressed issues related to tax administration under Title 81 rules:
1. Deference to the Tax Commissioner’s Interpretations
In Johnson v. N.D. Tax Commissioner, 2016 ND 134, the Supreme Court upheld the Commissioner’s interpretation of income tax reporting requirements.
The court noted that while the Commissioner’s rules have deference, they cannot conflict with statute or exceed the Commissioner’s authority.
Courts will uphold reasonable administrative interpretations unless clearly erroneous.
2. Due Process in Appeals
In Smith v. N.D. Tax Commissioner, 2018 ND 102, the court affirmed the importance of procedural safeguards during tax appeal hearings.
The taxpayer challenged a penalty assessment, claiming lack of notice and opportunity to be heard.
The court ruled that the Tax Commissioner’s hearing process under Title 81 complied with constitutional due process requirements.
3. Penalties and Waivers
In Anderson v. N.D. Tax Commissioner, 2019 ND 88, the court considered whether the Commissioner properly denied a waiver of penalties for late payment.
The decision emphasized the Commissioner’s discretion but also underscored that discretion must be exercised in accordance with established rules and fairness.
4. Collection Actions and Constitutional Limits
Miller v. N.D. Tax Commissioner, 2017 ND 145, reviewed the Commissioner’s authority to impose tax liens and enforce collections.
The court recognized the broad statutory authority but required compliance with notice requirements and protections against unlawful seizure.
Practical Implications for Taxpayers
Taxpayers must understand their filing obligations and comply with deadlines.
They should maintain thorough records to withstand audits.
If audited or assessed, taxpayers have rights to challenge and appeal Commissioner decisions.
Penalties and interest can be significant but may be waived in justified cases.
Confidentiality of tax information is protected but limited by law.
Working proactively with the Tax Commissioner’s office can help resolve issues efficiently.
Summary Table
| Topic | Details |
|---|---|
| Authority | NDCC Chapter 57 and related tax statutes; administrative rules in NDAC Title 81 |
| Tax Administration | Procedures for filing, payment, refunds, electronic filing |
| Audits | Notification, scope, taxpayer rights, records access |
| Appeals | Informal and formal hearings under Administrative Procedure Act; district court appeals |
| Penalties & Interest | Imposed for late/nonpayment; waiver discretion; enforcement tools like liens and levies |
| Confidentiality | Taxpayer data protection; limited disclosures under statute |
| Case Law | Courts defer to reasonable Commissioner interpretations; emphasize due process in appeals |
RELATED Blog
0 comments