Live in Tennessee, Work in North Dakota: Which State Taxes Your Paycheck?
Answer
One return, filed in North Dakota. Your employer withholds North Dakota tax on the wages you earn there and you settle up on a North Dakota nonresident return. Tennessee does not tax wages, so this pair produces a single state filing rather than two.
Last verified
This is the mirror image of the more common commute. There is no home-state return to file, so the North Dakota nonresident return carries the whole obligation — and because Tennessee charges nothing, there is no credit mechanism involved anywhere.
What you file
- 1Nonresident return · North DakotaForm ND-1 with Schedule ND-1NR
File a North Dakota nonresident return for the wages you earned in North Dakota. Tennessee has no wage income tax, so there is no second return and no credit to claim.
The two states, side by side
| Tennessee | North Dakota | |
|---|---|---|
| Taxes wages | No | Yes — graduated |
| Reciprocity partners | None | 2 (Form NDW-R) |
| Convenience rule | No | No |
| Nonresident return | Not applicable | Form ND-1 with Schedule ND-1NR |
| Credit for other-state tax | No income tax | Schedule ND-1CR |
| Nonresident safe harbour | Not applicable | None published |
| Local income tax | No | No |
| Revenue department | Tennessee Department of Revenue | North Dakota Office of State Tax Commissioner |
| Last verified |
The other direction
Reversing the commute does not always reverse the answer. Living in North Dakota and working in Tennessee gives:Home state only.
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: Tennessee → North DakotaNo state income tax on your wages
- 1099 contractor: Tennessee → North DakotaClient state only, if you work there
- Moved mid-year: Tennessee → North DakotaOne part-year return — the state you moved to
Other Tennessee pairs
Questions people actually ask
I live in Tennessee and work in North Dakota. Which state takes the tax out of my paycheck?
One return, filed in North Dakota. Your employer withholds North Dakota tax on the wages you earn there and you settle up on a North Dakota nonresident return. Tennessee does not tax wages, so this pair produces a single state filing rather than two.
Which state should my employer be withholding for?
North Dakota. The wages are sourced to North Dakota, so North Dakota withholding is correct and there is no Tennessee withholding to set up, because Tennessee levies no income tax on wages.
How current is this?
The Tennessee and North Dakota rules on this page were last checked against Tennessee Department of Revenue and North Dakota Office of State Tax Commissioner 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.
- Tennessee Department of Revenue — individual income taxaccessed 2026-08-07
- North Dakota Office of State Tax Commissioner — individual income taxaccessed 2026-08-07