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Taxes / State tax rules / North Dakota

Selling on eBay, Poshmark or Etsy from North Dakota: sales tax and 1099-K rules

On a marketplace sale delivered to North Dakota, the marketplace facilitator collects state and local sales tax if it has a physical presence or more than $100,000 of taxable North Dakota sales through the marketplace in the current or prior year, and a seller that receives the facilitator's written certification is no longer liable for tax on those sales. The North Dakota Office of State Tax Commissioner pages we checked say nothing about a separate state 1099-K rule.

General information, not tax advice. Check with a tax professional about your own situation.

Checked against the official pages listed below on .

North Dakota in short

General sales tax:
Yes
Marketplace facilitator law:
Yes: N.D.C.C. § 57-39.2-02.3, since Oct 1, 2019
When a marketplace must collect:
for a facilitator without physical nexus, taxable sales through the marketplace exceeding $100,000 in the current or prior calendar year, counting sales for all sellers and its own sales
Form 1099-K:
No state rule stated on the pages checked

Who collects the tax on a marketplace sale

A facilitator over the threshold, or with physical nexus, is considered the retailer of each sale it facilitates and collects North Dakota state and local sales and use tax on North Dakota sales made on its marketplace. It must certify to each seller that it will collect and remit.

If you sell only through marketplaces

A seller that received written certification from the facilitator is no longer liable for tax on sales made through that marketplace, and a seller with a North Dakota permit should not report those sales, the Tax Commissioner says. The statute lets a seller that accepts the certificate in good faith exclude marketplace sales from its return. The pages read do not say whether a seller with only marketplace sales must register.

Registration, resale certificates and what changes when you also sell direct have their own page: North Dakota: seller's permit and resale certificate rules.

The law: N.D.C.C. § 57-39.2-02.3, effective .

"Marketplace facilitators without physical nexus in North Dakota must have taxable sales exceeding $100,000 in the current or prior calendar year before they are required to collect and remit sales and use tax."
North Dakota Office of State Tax Commissioner, Marketplace Facilitator, page
"If a marketplace seller has a valid North Dakota sales and use tax permit, the seller should not report sales made through a marketplace if the facilitator has certified its responsibility to collect and remit tax."
North Dakota Office of State Tax Commissioner, Marketplace Facilitator, page: Marketplace Sellers Making Sales Through a Marketplace
"No marketplace facilitator is required to collect or remit sales or use tax under this section on any sale made before October 1, 2019."
North Dakota Legislative Branch, North Dakota Century Code Chapter 57-39.2, Sales Tax, N.D.C.C. § 57-39.2-02.3(7)

Sources: Marketplace Facilitator; North Dakota Century Code Chapter 57-39.2, Sales Tax.

North Dakota's sales tax

N.D.C.C. § 57-39.2-02.1 imposes a five percent tax on retailers' gross receipts from retail sales of tangible personal property and certain other items, and local taxes apply by delivery location. The Tax Commissioner's marketplace page points sellers to its Local Sales Tax Rate Locator for the rate at a delivery address.

"there is imposed a tax of five percent upon the gross receipts of retailers from all sales at retail"
North Dakota Legislative Branch, North Dakota Century Code Chapter 57-39.2, Sales Tax, N.D.C.C. § 57-39.2-02.1(1)

Sources: North Dakota Century Code Chapter 57-39.2, Sales Tax; Marketplace Facilitator.

Form 1099-K: North Dakota and the federal test

The Tax Commissioner's income tax withholding page covers filing Forms W-2 and 1099 for businesses with North Dakota withholding accounts but does not mention Form 1099-K, and the marketplace pages read say nothing about it.

The federal test, for comparison: the IRS says a payment app or online marketplace must send a Form 1099-K when payments for goods or services total over $20,000 in more than 200 transactions, and adds: "However, they may send you a Form 1099-K with lower amounts and/or transactions." (Understanding your Form 1099-K, reviewed ). The Instructions for Form 1099-K count both parts for the calendar year, through each platform separately, and say the box 1a gross amount is figured without adjustments for credits, discounts, fees, refunds or shipping, so a 1099-K figure is not the same as profit. More on the federal rule in Form 1099-K for resellers.

Sources: Income Tax Withholding.

Worked examples

State tax on a $40 marketplace sale to Fargo

At the 5% rate in N.D.C.C. § 57-39.2-02.1, a $40.00 taxable item carries $2.00 of state sales tax; local tax for the delivery address is added. The facilitator collects both.

When a newly qualifying facilitator must start

A facilitator with no North Dakota presence passes $100,000 of taxable marketplace sales into the state for the first time on March 10, 2026. It must register and start collecting within 60 days, by May 9, 2026, or on January 1, 2027, whichever is earlier, so May 9, 2026 is the deadline.

Permit holder with marketplace and direct sales

A North Dakota permit holder sells $6,000 through a marketplace that certified it collects North Dakota tax and $1,500 from its own website. Following the Tax Commissioner's page, the $6,000 of certified marketplace sales stay off its return; the $1,500 of direct sales remain its own to report.

Edge cases and details

  • A facilitator with a permit gets an assigned filing frequency and must file returns on it even when it has no sales or tax to report, the Tax Commissioner says.
  • A payment processor a seller chooses only to handle card or debit transactions is not a marketplace facilitator.
  • Under § 57-39.2-02.3(4), a facilitator is not liable for tax it missed if it had a system requiring accurate seller information, the error came from the seller's incorrect information, and the two are not affiliated; then the seller and buyer are liable.
  • A class action may not be brought against a facilitator over overpaid sales or use tax it collected, under § 57-39.2-02.3(6).

What to do

  1. Keep each marketplace's written certification that it collects North Dakota tax; the statute ties the seller's exclusion to accepting that certificate in good faith.
  2. If you hold a North Dakota permit, keep certified marketplace sales separate from direct sales in your records, since the Tax Commissioner says certified sales are not reported.
  3. For questions on seller duties, the Tax Commissioner's page lists its Sales Tax Compliance Section; a tax professional can also help.

Common questions

Do I report marketplace sales on a North Dakota sales tax return?

Not if the facilitator has certified it collects and remits North Dakota tax. The Tax Commissioner says a permit holder should not report those sales, and the statute lets a seller that accepts the certificate in good faith exclude them.

When did North Dakota marketplace facilitators start collecting?

The statute says no facilitator is required to collect on any sale made before October 1, 2019.

Does North Dakota have its own 1099-K threshold?

The Tax Commissioner pages we checked say nothing about a North Dakota 1099-K rule.

Related

General information, not tax advice

This page summarizes North Dakota's own published pages and statutes as read on , and the IRS's 1099-K pages. It doesn't say what you should file, register for or pay. Rules depend on your situation and change: check with a tax professional, or with the state's revenue department.

Sources

Official pages this page is built from, with the day each was read.

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