North Dakota economic nexus threshold

Affiliate nexus

North Dakota has no standalone affiliate nexus statute for general remote sellers. Affiliation definitions appear only within the marketplace facilitator framework, where two entities are considered affiliated if one owns more than 5% of the other, or a common entity owns more than 5% of each. This affiliation standard is relevant to liability allocation between marketplace facilitators and affiliated sellers, not to general nexus attribution between parent companies, subsidiaries, or other commonly owned entities operating outside the marketplace facilitator context.

Physical nexus

Physical nexus in North Dakota is governed by NDCC § 57-40.2-01(7), which defines physical presence to include any office, distribution house, sales house, warehouse, or other place of business, whether permanent or temporary, maintained directly or through a subsidiary. Any agent or employee in the state creates nexus regardless of whether the employee's role involves sales activity. Inventory held in a third-party warehouse in North Dakota creates nexus when the seller controls the movement of that inventory. Uncontrolled inventory in a third-party warehouse, where the seller does not direct movement, does not create physical nexus. Attending a trade show without soliciting sales or taking orders does not trigger nexus; actively exhibiting and taking orders at a trade show does.

Trailing nexus

North Dakota has no express trailing nexus statute. The current or prior calendar year evaluation period produces a trailing obligation by operation of the threshold structure: a seller that exceeded $100,000 in taxable sales in Year 1 remains obligated throughout all of Year 2, even if Year 2 sales fall below the threshold. The obligation ends only once both the current calendar year and the most recent prior calendar year are each below $100,000.