When transferring real estate property using a North Dakota quitclaim deed, you may be required to pay recording fees and certain state and federal taxes.
Recording Fees
Recording fees for deeds are established under N.D. Cent. Code § 11-18-05. They include the following:
- $20.00 for documents up to six pages
- $65.00 for documents between seven and 25 pages
- $3.00 per page for each additional page over 25 pages
Taxes
North Dakota does not charge a transfer tax for real estate conveyances. You may, however, owe gift or capital gains taxes on a federal and state level.
1. US Gift Tax (Form 709)
When you give real estate property as a gift using a North Dakota quitclaim deed, you may be liable for federal gift tax. Although North Dakota does not charge a gift tax at the state level, the US government does require the grantor to report gifts over a certain value.
The Internal Revenue Service (IRS) assesses gift tax as part of your annual income tax return if the gift value is greater than the federal exemption amount. The exemption amount changes each year, so check the IRS website to confirm whether you owe gift tax for your North Dakota quitclaim [1]. If the property exceeds the annual exemption value, complete form 709 along with your annual income tax filing [2].
2. Capital Gains Tax
North Dakota taxes capital gains as income at a rate they update annually [3]. The amount you owe for capital gains will depend on how much of a profit you made from the property transfer via quitclaim deed.
Typically, North Dakota offers exemptions for capital gains below a certain percent of your taxable income. They also consider how long you held the property before selling. Exclusions for capital gains in North Dakota differ from federal exclusions, so you may owe capital gains tax to one but not the other.
The IRS bases capital gains rates on your household’s annual income, how much you earned from the property sale, and how long you owned the property before selling it [4].
