North Dakota Launches $3 Million Automated Equipment Tax Credit

en.Wedoany.com Reported - On October 21, the North Dakota Department of Commerce announced the launch of the 2026 Automated Equipment Tax Credit application, with an annual credit cap of $3 million. Eligible businesses that purchase or enter into capital leases for automated machinery and robotic equipment may receive an income tax credit of up to 15% of the qualified equipment cost. The policy covers automation investments in livestock farming, livestock product processing, and manufacturing. The application deadline is February 2, 2027, at 5:00 p.m. Central Time.

The credit is implemented under North Dakota Century Code Section 57-38-01.41 and applies to new and used automation and robotic equipment installed and used within the state. Livestock agriculture operations include the breeding and raising of cattle, swine, sheep, goats, bison, farmed elk, and poultry, as well as the processing of meat, dairy products, and eggs. Manufacturing enterprises that purchase automated equipment to upgrade existing production processes may also apply under the same program.

Of the annual $3 million cap, $500,000 is reserved respectively for businesses applying for the livestock agriculture automation equipment credit for the first time and for businesses applying for the manufacturing automation equipment credit for the first time. If total qualified credit applications exceed the annual budget, approved amounts will be allocated on a pro rata basis. Unused credit amounts may be carried forward for up to five taxable years.

Applicant businesses must qualify as primary-sector businesses as determined by the North Dakota Department of Commerce. Equipment must be actually installed and operating within the state, and the business must demonstrate that the investment improves job quality or increases production output. Assessment metrics include average wages, workplace safety levels, or an increase of at least 5% in output per unit time. Automated equipment used solely to replace existing equipment without upgrading the manufacturing process does not qualify for the manufacturing credit.

Businesses shall submit applications and supporting documentation for equipment purchase, lease, and delivery through the Department of Commerce online system. For applications requiring additional clarification, the administering agency provides one opportunity to supplement materials within a seven-business-day period. Complete application materials for 2026 equipment investments must be submitted before the February 2, 2027 deadline.