Form NC-NA is the North Carolina Nonresident Shareholder Agreement: a one-time form each nonresident shareholder of a North Carolina S-Corporation signs, promising to file a North Carolina individual income tax return and pay state tax on their share of the corporation’s North Carolina income. The S-Corporation collects the signed form and submits it by attaching it to its annual CD-401S return. If a nonresident shareholder has no signed agreement on file, the corporation itself must pay estimated tax on that shareholder’s behalf at the individual income tax rate, which is 3.99% for the 2026 tax year.
Who Has to Sign One
N.C. Gen. Stat. ยง 105-131.7(c) requires an S-Corporation doing business in North Carolina to file an agreement with the Department of Revenue for every nonresident shareholder.1North Carolina General Assembly. North Carolina Code 105-131.7 – Returns; Shareholder Agreements; Mandatory Withholding The statute uses the term “nonresident shareholder” without limiting it to individuals, so an estate, trust, or other entity holding shares as a nonresident each needs its own signed NC-NA.
The signer agrees to two things. First, to file a North Carolina individual income tax return and pay all state tax owed on their share of the S-Corporation’s North Carolina income. Second, to submit to personal jurisdiction in North Carolina for collection of any unpaid tax, interest, or penalties. The agreement binds the shareholder’s heirs, representatives, assigns, successors, executors, and administrators.
When the Agreement Has to Be Filed
The NC-NA is not an annual filing. The statute requires it at two specific moments:
- When the S-Corporation first becomes subject to North Carolina income tax, it files an NC-NA for every nonresident shareholder with that period’s CD-401S.
- For any later tax year in which the corporation has a nonresident shareholder who has never had an agreement on file, it files an NC-NA for that shareholder with that year’s return.1North Carolina General Assembly. North Carolina Code 105-131.7 – Returns; Shareholder Agreements; Mandatory Withholding
Once a signed agreement is on file for a shareholder, it stays effective as long as that shareholder keeps their interest, with no need to refile. Keep an internal roster of which nonresident shareholders already have agreements on record, because any gap triggers the mandatory corporation-paid tax.
Completing the Form
The form is on the North Carolina Department of Revenue’s corporate tax forms page.2North Carolina Department of Revenue. Corporate Tax Forms and Instructions It has a corporation section and a shareholder section.
Corporation Section
An officer completes the top portion with the corporation’s Federal Employer Identification Number; the legal name, address, and ZIP code as registered with the North Carolina Secretary of State; the effective date of the federal S election; and the first tax year the corporation filed Form CD-401S. The officer signs, dates, and gives their title.
Shareholder Section
The nonresident shareholder completes the rest: Social Security Number or Individual Taxpayer Identification Number; current out-of-state name, address, and ZIP; the date they first acquired shares; their own tax year beginning and ending dates (not the corporation’s); a telephone number; and a signature with date and title.
Check identifying numbers against each party’s most recent federal return before signing. A mismatched FEIN or SSN can delay processing or cause the Department of Revenue to treat the agreement as unfiled, which pushes the tax burden back onto the corporation.
Submitting Form NC-NA
The S-Corporation submits every signed NC-NA. Shareholders do not mail it in on their own. The standard method is to attach the form as a PDF to the electronically filed CD-401S.2North Carolina Department of Revenue. Corporate Tax Forms and Instructions Most commercial tax software supports PDF attachments for this purpose.
For calendar-year S-Corporations, the CD-401S is due April 15 after the close of the tax year. A federal automatic extension carries over to North Carolina with no separate state extension form, provided the corporation certifies on its North Carolina return that it received the federal extension.3North Carolina Department of Revenue. Extensions
Paper filers include the signed NC-NA with the CD-401S package mailed to the North Carolina Department of Revenue, P.O. Box 25000, Raleigh, NC 27640-0640.
What Happens If No Agreement Is on File
A missing NC-NA for any nonresident shareholder creates an immediate obligation for the corporation. The statute requires the corporation to pay an estimated tax to the Department of Revenue on that shareholder’s behalf, calculated at the individual income tax rate on the shareholder’s pro-rata share of the corporation’s North Carolina income.1North Carolina General Assembly. North Carolina Code 105-131.7 – Returns; Shareholder Agreements; Mandatory Withholding For 2026, that rate is 3.99%.4NCDOR. Tax Rate Schedules
The statute allows the corporation to recover the payment from the shareholder on whose behalf it was made. Collecting a signature up front is almost always easier than chasing reimbursement later, and the corporation is out the cash until it works that reimbursement through distributions or another arrangement.
Missing the required payment also exposes the corporation to standard North Carolina penalties: a failure-to-file penalty of 5% of the tax per month up to 25%, plus a flat 5% failure-to-pay penalty, with interest on top.5North Carolina General Assembly. North Carolina Code 105-236 – Penalties
The Shareholder’s Return When No Agreement Was Filed
If the corporation paid the estimated tax on a nonresident shareholder’s behalf because no NC-NA was on file, that shareholder may not have to file a North Carolina individual income tax return, provided the S-Corporation income is their only North Carolina source income. North Carolina’s administrative code allows the shareholder to skip the individual return in that situation, and if they do file, they can claim a credit for the tax the corporation already paid.6Cornell Law Institute. 17 North Carolina Administrative Code 06B .4003 – Nonresident Shareholders
A shareholder who signs the NC-NA has agreed to file a North Carolina return (Form D-400) for any year the corporation allocates North Carolina income to them, with the filing and payment responsibility sitting with the individual rather than the corporation.