Drake Tax Online - NC - Nonconformity to Federal Tax Law Changes After January 1, 2023

North Carolina conforms to the federal tax law as it existed on January 1, 2023. The federal tax law changes passed July 4, 2025, do not apply when calculating North Carolina income tax. As a result, you may need to add back or adjust the AGI amount that is carried from the federal return to the NC return. See the NC DOR Notice for details.

In Drake Tax Online, adjust the AGI that is used for NC purposes by following these steps.

1. On the left, click States.

2. Expand the North Carolina drop-down.

3. Click on the General tab.

4. Click on Federal Nonconformity Adjustment.

5. Use the box Federal adjusted gross income to adjust the amount that should be used for the NC return. A positive value will increase the AGI used on NC D-400, line 6. A negative will decrease the amount.

6. Click Save.

7. Click on the NC Other tab and select PDF E-File Attachments. Complete this screen as follows, and click Save:

   • Reference Source: NONCONFORMITY

   • Description: Federal Nonconformity Changes

   • File Name: TY25NCFAGICALC.PDF

8. Click on File and select the Attach Now button.

9. Attach a PDF that explains the adjustment (clears Error 0107).