New Construction Tax Incentives in Fargo-Moorhead
Nine FM-area cities offer 2-year property tax breaks on new homes. ND exemption saves ~$4,000; MN rebate saves $5,500–$7,500+. Compare programs and estimate your savings.
Building a new home in the Fargo-Moorhead metro comes with a financial perk most buyers don't know about — a multi-year property tax break. Nine cities across North Dakota and Minnesota offer new-construction incentives that can save you thousands of dollars in your first years of homeownership. Use the estimator below to see what you could save, then explore each city's program for details and contacts.
Two States, Two Programs
North Dakota — Tax Exemption
- Up to $150,000 of improvement value exempt from property tax
- 2 taxable years after construction is complete
- Land stays taxable — improvements only
- Application required by February 1 (city assessor)
- Authority: NDCC 57-02-08(35)
Minnesota — Tax Rebate
- Full home value covered — building and land, no cap
- 2 years from building permit issuance
- Pay taxes on schedule, receive rebate check in December
- Authority: MN Statute 469.1813
Explore by City
- Fargo, ND — tax exemption
- West Fargo, ND — tax exemption
- Horace, ND — tax exemption
- Casselton, ND — tax exemption
- Colfax, ND — tax exemption
- Mapleton, ND — tax exemption
- Moorhead, MN — tax rebate
- Dilworth, MN — tax rebate
- Barnesville, MN — tax rebate
Frequently Asked Questions
Which Fargo-Moorhead cities offer tax incentives for new construction?
Nine cities in the FM metro currently offer new-construction tax incentives: Fargo, West Fargo, Horace, Casselton, Colfax, and Mapleton in North Dakota, and Moorhead, Dilworth, and Barnesville in Minnesota. Each city's program has its own details — click through to the city pages for specifics.
What's the difference between ND's tax exemption and MN's tax rebate?
In North Dakota, new-home buyers receive an exemption — you simply don't pay property taxes on the first $150,000 of improvement value for two years (land stays taxable). In Minnesota, buyers pay their full tax bill on schedule and then receive a rebate check in December covering the general taxes paid. Minnesota's program has no value cap and includes both building and land, making it more generous on higher-value homes.
How much can I save by building a new home in the FM area?
In North Dakota cities, the estimated savings are approximately $4,000 over two years on the maximum $150,000 of improvement value. In Minnesota, savings vary by city and home value — Moorhead estimates more than $7,500 on a $300,000 home, while Dilworth estimates approximately $5,500 on a $250,000 home. Use the estimator on this page for a quick estimate based on your city and price point.
Do I have to apply, or is the tax break automatic?
It depends on the state. In North Dakota, you need to file an application with the city assessor — typically by February 1 of the first exemption year. In Moorhead, enrollment is automatic when your building permit is issued. Check your city's page for the specific process.
Are there tax incentives for home remodeling?
In North Dakota, there's a separate program under NDCC 57-02.2 that exempts the added value of renovations to buildings at least 25 years old — for up to five years. In Moorhead, a two-year rebate is available on home improvements of $25,000 or more. Contact your city for current details.
Can I combine the tax incentive with down-payment assistance or builder warranties?
Yes. The property tax programs are independent of mortgage and financing programs. Many new-home buyers also use programs like NDHFA FirstHome (ND) or Minnesota Housing Start Up (MN) for down-payment help. Builder warranties are between you and your builder and aren't affected by the tax incentive.
Keep Planning Your Build
Modern Market REALTORS® — Jim Christl (Broker) & Shannon Barnum (Associate Broker). Serving Fargo, Moorhead, West Fargo, Horace, Detroit Lakes, and Minnesota lake country. Call (701) 205-5517.