Guide to filing a North Carolina state tax return

This article was fact-checked by our editors and CPA Janet Murphy, senior product specialist with Credit Karma. It has been updated for the 2019 tax year.

North Carolina is among the 43 states that tax the individual income of their residents.

And while the Tar Heel State was the 12th to join the Union after the American Revolution, it ranks in the middle of the pack (20th) in terms of the tax burden it imposes on residents, according to the Tax Foundation.

When it comes to taxation, the state where the Wright brothers first took flight follows federal tax laws in some respects — and goes its own way in others. Here are a few things to know about filing your North Carolina state tax return.

• The basics of North Carolina state taxes
• North Carolina deductions and credits
• How to file your North Carolina state tax return
• If you owe and can’t pay
• Tracking your North Carolina tax refund

The basics of North Carolina state tax

Taxing body

The North Carolina Department of Revenue administers tax laws and collects taxes in the state of North Carolina. The state’s governor appoints the secretary of revenue, who heads the department.

The department’s general information number is 1-877-252-3052. There’s also a number for inquiries into individual tax refunds: 1-877-252-4052.

Filing and payment deadline

For 2019 state taxes, North Carolina has extended its filing and payment deadline. State residents now have until July 15, 2020, to file their state returns and pay any tax they may owe for the year.

You don’t need to do anything to get this extension — it’s automatic for North Carolina taxpayers.

While this year is a little different, North Carolina’s Tax Day generally follows the deadline for filing your federal tax return — April 15. If the 15th falls on a weekend or holiday, the deadline will be extended to the next business day.

Any tax you owe is due on the filing deadline.

Filing statuses

North Carolina recognizes federal filing statuses.

• Single
• Married filing jointly
• Married filing separately
• Head of household
• Qualifying widow(er)/Surviving spouse

Additionally, North Carolina has a status for nonresident aliens.

North Carolina income tax rates

North Carolina’s individual income tax is a flat rate of 5.25% for the 2019 tax year. To calculate any state income tax you may owe, multiply your taxable income by .0525.

North Carolina deductions and credits

Child deduction

If you’re allowed to take a federal child tax credit, you are allowed to take a state-level deduction for each dependent child that qualifies for the federal credit.

The amount of the per-child deduction depends on your federal adjusted gross income and filing status. Depending on these factors, the deduction ranges from zero to $2,500. This deduction is above-the-line, meaning if you’re eligible for it, you can take it even if you don’t itemize deductions on your state return.

Standard deduction

In North Carolina, you can take either a standard deduction or itemize your deductions. If you took the standard deduction on your federal return, you must take the North Carolina standard deduction on your state return. If you itemized deductions on your federal return, you may choose to either itemize on your state return or take the North Carolina standard deduction.

Here are the standard deductions by filing status for 2019.

• Single: $10,000
• Married filing jointly: $20,000
• Married filing separately: $10,000 (zero if spouse itemizes deductions)
• Head of household: $15,000
• Qualifying widow(er)/Surviving spouse: $20,000

Deductions you can itemize

For the 2019 tax year, North Carolina filers have access to several itemized tax deductions.

• Qualified mortgage interest and real estate property taxes: You can deduct up to $20,000 in qualified mortgage interest and real estate property taxes.
• Charitable contributions: North Carolina generally follows federal tax code regulations on deducting charitable contributions.
• Medical and dental expenses: The state follows federal tax code for rules governing deductions for medical and dental expenses.
• Claim of right deduction: If you reported and paid taxes on income in a previous year, and then had to pay that income back, you may be able to take a deduction for all or part of the repaid income.

Available tax credits

Depending on your tax situation, you may be eligible for some state-level tax credits. Some available credits include the following:

• If you live in North Carolina and earned income in another state or country, and had to pay tax on that income to that state or country as well as to North Carolina, you may qualify for a tax credit.
• If you rehabilitate a qualified historic structure, you may be able to claim a credit (available for both business and residential structures).

How to file your North Carolina state tax return

You have multiple options for filing and paying your North Carolina state taxes.

• E-file and pay through the Department of Revenue website. You’ll need to create an account.
• Download and mail forms — including the D-400, North Carolina’s equivalent of the federal 1040 — through the DOR website. You can complete and mail these forms to N.C. Dept. of Revenue, P.O. Box R, Raleigh, NC 27634-0001 if you’re due a refund, or to N.C. Dept. of Revenue, P.O. Box 25000, Raleigh, NC 27640-0640 if you are not due a refund.
• E-file through an approved software provider. Providers may charge fees, so be sure to review terms, conditions and costs before choosing a provider.

Taxpayer help

The Office of the Taxpayer Advocate is available to help North Carolina taxpayers experiencing problems with the Department of Revenue. You can contact the office through an online submission form or via voicemail at 919-715-2080. You can also mail or fax your questions.

If you owe and can’t pay

If you owe North Carolina state taxes and can’t pay, the DOR advises you to file your return and pay whatever you can by the due date in order to minimize penalties and interest.

Once you receive an official notice from the DOR regarding your unpaid tax, you can make an online request for an Installment Payment Agreement.

Tracking your North Carolina tax refund

Just like the IRS, the North Carolina Department of Revenue has a “Where’s My Refund?” tool to help you track your refund. Be aware that math errors, incorrect forms, and missing or incomplete information can delay your refund.

Bottom line

North Carolina and other states rely on taxes to generate revenue that pays for public services and keeps the state government running. Filing and paying your North Carolina state tax return isn’t that different from filing and paying your federal return. But a flat income tax rate may mean it’s easier to understand how to calculate your North Carolina income tax obligation.

A senior product specialist with Credit Karma, Janet Murphy is a CPA with more than a decade in the tax industry. She’s worked as a tax analyst, tax product development manager and tax accountant. She has accounting degrees and certifications from Clemson University and the U.S. Career Institute. You can find her on LinkedIn.