North Dakota

North Dakota Exempts Poor Families from the Income Tax

 

North Dakota’s 1999 income tax threshold — the income level at which families begin paying income tax:	Ranking among 42 states with income taxes
For two-parent families of four: $18,700.	16th highest
For single-parent families of three: $15,100.	17th highest (tie)
North Dakota’s 1999 income tax on working-poor and near-poor families:
No tax on families with incomes at the poverty line ($17,028 for family of four, $13,290 for family of three).
No tax on families of three or four with full-time minimum-wage earnings ($10,712).
For families of four with incomes at 125% of the poverty line ($21,285): $65.	14th lowest
For families of three with incomes at 125% of the poverty line ($16,613): $42.	16th lowest
North Dakota has consistently exempted families with below-poverty earnings from the income tax. Because North Dakota’s tax threshold for families of four has risen during the 1990s, the threshold has remained above the poverty line. (See chart.) In 1991, a family of four owed no tax until its income reached 6 percent above the poverty line. North Dakota’s tax threshold is now 10 percent above the poverty line.