The Short Answer
Active-duty pay of members in the active or reserve components is fully exempt from North Dakota income tax. Your base pay is set by the federal pay table — identical to every other state for your rank and years of service. What actually changes in North Dakota is your BAH (averaging $1,200/mo without dependents and $1,500/mo with dependents) and how North Dakota treats the taxable portion of your pay.
State tax status: ✓ TAX EXEMPT
2026 Worked Example — E-5, 6 Years, With Dependents in North Dakota
Here is how the math actually lands for a mid-career enlisted member stationed in North Dakota, built the way I read my own LES. Base pay and BAS are federal; the North Dakota BAH figure is the state average.
| Monthly line item | Amount | Taxable? |
|---|---|---|
| Base pay (E-5, over 6 yrs) | $3,874 | Yes (federal + state) |
| BAH with dependents (North Dakota avg) | $1,500 | No — tax-free |
| BAS (enlisted) | $476.95 | No — tax-free |
| Gross monthly entitlements | $5,850.95 | — |
| Taxable income (base pay only) | $3,874 | — |
| Est. North Dakota state income tax | varies — see notes | — |
Only the $3,874 of base pay is taxable — the $1,976.95 of BAH + BAS is completely tax-free. Run your exact rank, ZIP, and dependency status in the Military Pay Calculator for a precise estimate.
How North Dakota Taxes Each Type of Military Pay
Active-Duty Base Pay
Active-duty pay of members in the active or reserve components is fully exempt from North Dakota income tax.
Guard & Reserve Drill Pay
North Dakota Guard and Reserve pay is covered by the full military pay exemption.
Military Retirement Pay
Military retirement pay is fully exempt from North Dakota income tax.
VA Disability Compensation
VA disability compensation is exempt federally and is not taxed by North Dakota.
SCRA & Residency in North Dakota
Under SCRA, a nonresident airman at Minot or Grand Forks AFB owes no North Dakota income tax on military pay.
This is the single most misunderstood rule in military pay. Your home of record / state of legal residence — not your duty station — generally determines who can tax your military pay. Changing it is a deliberate act, not something that happens automatically when you PCS.
Major Military Installations in North Dakota
- Minot Air Force Base
- Grand Forks Air Force Base
- Cavalier Space Force Station
BAH is set by the Military Housing Area covering your duty ZIP. Verify your exact rate at the official DoD BAH lookup.
Official Sources
FAQ — Military Pay in North Dakota
Does North Dakota tax my military base pay?
Active-duty pay of members in the active or reserve components is fully exempt from North Dakota income tax.
Is my BAH taxed in North Dakota?
No. BAH is federally tax-free and is never counted as income for North Dakota state income tax, regardless of how North Dakota treats base pay.
Does North Dakota tax military retirement pay?
Military retirement pay is fully exempt from North Dakota income tax.
I'm stationed in North Dakota but my home of record is elsewhere — who taxes me?
Under SCRA, a nonresident airman at Minot or Grand Forks AFB owes no North Dakota income tax on military pay.