Live in North Dakota, Work in Massachusetts: Which State Taxes Your Paycheck?
Answer
Two returns, one credit. Massachusetts has the first claim on wages earned inside the state and withholds accordingly. North Dakota then taxes you as a resident on everything and gives credit for what Massachusetts already took, capped at what North Dakota would have charged on that same income.
Last verified
Without an agreement between North Dakota and Massachusetts, the overlap is handled after the fact rather than prevented. That is why the filing order matters: the Massachusetts figure is an input to the North Dakota return, so completing North Dakota first means doing it twice.
A North Dakota resident taxed by another state on the same income claims the credit for taxes paid to other states on Schedule ND-1CR. The credit is capped at the North Dakota tax on that income, so it removes the double tax but never refunds the excess when the other state charges more.
What you file
- 1Nonresident return · MassachusettsForm 1-NR/PY
File the Massachusetts nonresident return FIRST — you need the Massachusetts tax figure before you can complete North Dakota.
- 2Resident return · North DakotaSchedule ND-1CR
File a North Dakota resident return reporting all income, then claim the credit for tax paid to Massachusetts. The credit is capped at what North Dakota would have charged on that same income, so if Massachusetts taxes it at a higher rate the difference is not refunded.
The two states, side by side
| North Dakota | Massachusetts | |
|---|---|---|
| Taxes wages | Yes — graduated | Yes — flat |
| Reciprocity partners | 2 (Form NDW-R) | None |
| Convenience rule | No | No |
| Nonresident return | Form ND-1 with Schedule ND-1NR | Form 1-NR/PY |
| Credit for other-state tax | Schedule ND-1CR | Schedule OJC |
| Nonresident safe harbour | None published | None published |
| Local income tax | No | No |
| Revenue department | North Dakota Office of State Tax Commissioner | Massachusetts Department of Revenue |
| Last verified |
The other direction
Reversing the commute does not always reverse the answer. Living in Massachusetts and working in North Dakota gives:Both states — credit offsets the double tax.
Same two states, different situation
The withholding answer turns on how you are paid and where the work happens, not only on which two states are involved.
- Remote worker: North Dakota → MassachusettsHome state only
- 1099 contractor: North Dakota → MassachusettsHome state, plus the client state if you work there
- Moved mid-year: North Dakota → MassachusettsTwo part-year returns
Other North Dakota pairs
Questions people actually ask
I live in North Dakota and work in Massachusetts. Which state takes the tax out of my paycheck?
Two returns, one credit. Massachusetts has the first claim on wages earned inside the state and withholds accordingly. North Dakota then taxes you as a resident on everything and gives credit for what Massachusetts already took, capped at what North Dakota would have charged on that same income.
Which state should my employer be withholding for?
Massachusetts. The wages are sourced to Massachusetts, so Massachusetts withholding is correct and there is no North Dakota withholding to set up.
Will I end up paying tax twice on the same income?
Not twice over, but you will pay the higher of the two rates. North Dakota gives residents a credit for tax paid to Massachusetts on the same income, claimed on Schedule ND-1CR. The credit is capped at the North Dakota tax on that income, so if Massachusetts taxes it more heavily the excess is not refunded by either state.
How current is this?
The North Dakota and Massachusetts rules on this page were last checked against North Dakota Office of State Tax Commissioner and Massachusetts Department of Revenue on 2026-08-07. We re-check the full grid every December after state legislative sessions close, and re-check the convenience-of-the-employer states quarterly because that is where the rules move fastest.
Sources
Every fact above comes from the revenue department that publishes the rule. We do not cite secondary summaries, and we do not restate a figure we could not find at source.
- North Dakota Office of State Tax Commissioner — individual income taxaccessed 2026-08-07
- Massachusetts Department of Revenue — individual income taxaccessed 2026-08-07