What Is the Current Montana Income Tax Rate?

State income taxes fund various public services and programs. Montana is one of the states that levies an income tax on its residents and those earning income within its borders.

Montana’s Progressive Income Tax Rates

Montana operates a progressive income tax system, where higher income brackets are taxed at a higher rate. For the 2024 tax year, Montana has streamlined its individual income tax into two distinct brackets. The lower rate is 4.7%, and the higher rate is 5.9%.

The specific income thresholds for these rates vary based on filing status. For single filers, the 4.7% rate applies to taxable income up to $20,500, with income exceeding this amount taxed at 5.9%. Married individuals filing jointly are subject to the 4.7% rate on taxable income up to $41,000, and the 5.9% rate applies to income above that threshold. Head of household filers have a 4.7% rate on income up to $30,750, and income beyond that is taxed at 5.9%.

Montana residents are generally subject to state income tax on all their income, regardless of where it was earned. Non-residents, however, are taxed only on income sourced from within Montana. Income types commonly subject to Montana income tax include wages, salaries, business income, interest, and dividends.

Determining Your Montana Taxable Income

Calculating Montana taxable income for the 2024 tax year begins with the federal taxable income reported on your federal income tax return. Montana no longer has separate state-specific standard or itemized deductions, as these are accounted for by starting with federal taxable income.

Montana allows for certain state-specific adjustments and subtractions. Taxpayers aged 65 or older may subtract an additional $5,500 from their federal taxable income. If both spouses in a married filing jointly couple are 65 or older, this subtraction increases to $11,000. Some military retirement income may also be eligible for subtraction.

Montana repealed personal exemptions starting in 2024. Many previous state-specific deductions were also eliminated for the 2024 tax year. Taxpayers should review the Montana Department of Revenue’s guidance for a comprehensive list of current subtractions and any changes.

Filing Your Montana Income Tax Return

Once your Montana taxable income and tax liability are determined, the next step is filing your return. The primary form for individual income tax is Form 2, the Montana Individual Income Tax Return. This form, along with its instructions and any necessary schedules, can be accessed and downloaded from the Montana Department of Revenue’s official website.

Taxpayers have options for submitting their returns, including e-filing through approved tax software providers or mailing a paper return. The standard deadline for filing Montana individual income tax returns and making any tax payments due is April 15 of the year following the tax year. For the 2024 tax year, this due date is April 15, 2025.

Montana automatically grants a six-month extension to file your return, pushing the filing deadline to October 15. However, this extension applies only to the filing of the return, not to the payment of any taxes owed. Any tax liability must still be paid by the original April 15 deadline to avoid potential penalties and interest. Payments can be made electronically through the Department of Revenue’s online services or by mail.