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NC-3
Web Instructions for Form NC-3
10-20
Annual Withholding Reconciliation
Form NC-3 and the required W-2 and 1099 statements, (collectively “Form NC-3”) must be filed electronically. To file Form
NC-3 electronically, visit the Department’s website at www.ncdor.gov. A return not filed electronically is subject to a penalty for
failure to file an informational return in the proper format. Important: If you have electronically filed Form NC-3, do not mail the
paper copies of these forms and statements to the Department. For additional information on Form NC-3 including Frequently
Asked Questions, see eNC3 webpage located on the Department’s website at www.ncdor.gov/enc3.
General Instructions
Form NC-3 reconciles the total North Carolina income tax withheld as listed on the W-2 and 1099 statements with the
amount of tax reported as withheld for the year. If you are required to withhold or you voluntarily withheld North Carolina
income taxes, you must file Form NC-3. Important: If you do not have a requirement to file Form NC-3, you may still have
a requirement to file certain W-2 and 1099 statements with the Department.
Due Date - Unless you terminate your business, Form NC-3 and the State’s copy of each required Form W-2, Form W-2G,
Form NC-1099M, Federal Form 1099-NEC, Federal Form 1099-MISC, Federal Form 1099R, and Federal Form 1042-S must
be filed with the Department on or before January 31 for the preceding calendar year. Other reports of 1099 information
(such as interest, rents, premium, dividends, etc.) must be filed with the Department on or before the due date of Form NC-3,
if the payment amounts meet the federal information return reporting thresholds and the payments have not been reported
to the Internal Revenue Service.
If you terminate your business, Form NC-3 and the required W-2 and 1099 statements must be filed within 30 days of the
date on which you closed your business.
Penalties - By law, the Department may impose the following penalties against a taxpayer for failure to comply with the tax
statutes:
• failure to file an informational return timely ($50 per day with a maximum of $1,000),
• failure to file an informational return in the proper format ($200),
• failure to file a tax return on the date it is due (5% per month with a maximum of 25% on the amount of additional tax
due), and
• failure to pay tax when due (10% on the amount of additional tax due).
The failure to pay penalty will not be assessed if the amount of tax shown due on the return is paid on or before the due
date of the return.
Specific Instructions
Lines 1-12: Enter the amounts of North Carolina income tax reported as withheld in the appropriate space. Monthly filers
enter the amount reported as withheld on each line. Quarterly filers enter the amount reported as withheld on
Lines 3, 6, 9, and 12. Semiweekly filers enter the amount reported as withheld on Forms NC-5Q on Lines 3,
6, 9, and 12.
Line 13: Add the amounts listed in Lines 1 through 12.
Line 14: Enter the amount of North Carolina income tax withheld from wages as reported on wage and tax statements
(W-2 statements).
Line 15: Enter the amount of North Carolina income tax withheld as reported on 1099 statements. This includes North
Carolina tax withheld from (1) personal services compensation paid to nonresidents, (2) compensation paid to
contractors identified by an individual taxpayer identification number (ITIN), including applied for and expired
numbers, (3) compensation paid to individuals or entities that fail to provide the payer with a taxpayer identification
number, (4) compensation paid to individuals or entities who provided invalid taxpayer identification numbers to
the payer and the payer was notified by the Department that the taxpayer identification number is invalid, and
(5) pensions, annuities, and deferred compensation.
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