Budget & Taxes (Income Tax)

signed · Montana · Senate May 13, 2025

SB 544: Revise income tax laws for net operating loss carryovers

SB 544 revises Montana's individual income tax laws to allow taxpayers an election to account for certain past net operating losses. It directly affects individuals who had differences between their federal and Montana net operating loss carryovers before January 1, 2024. These taxpayers can choose to make a "transition adjustment" on their 2024 income tax return, filed by October 15, 2025, to address these discrepancies. If elected, this adjustment can reduce Montana taxable income for 2024 and up to seven subsequent years until the loss is fully utilized. The bill aims to provide a mechanism for individuals to claim losses not fully recognized under previous 2021 tax simplification legislation.

Topics ✓ Budget & TaxesSupports Budget & TaxesAllows taxpayers to reduce 2024 taxable income via transition adjustment for federal-Montana loss carryover discrepancies, providing tax relief.95% confidence

Sub-Topics Business Taxes Income Tax

died · Montana · House May 20, 2025

HB 148: Repeal state tax on social security income

HB 148 proposes to exempt Social Security benefits from the state income tax in Montana. This bill would revise existing tax laws by amending specific sections of the Montana Code Annotated related to income tax definitions. If passed, it would directly affect individuals in Montana who receive Social Security income by eliminating their state tax liability on those benefits. The bill also specifies a delayed effective date and an applicability date for these changes.

Topics ✓ Budget & TaxesSupports Budget & TaxesRepeals tax on Social Security benefits, providing tax relief to seniors (lower-income retirees), directly aligning with support indicators for tax relief.95% confidence

Sub-Topics Income Tax

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signed · Montana · House May 19, 2025

HB 845: Increase IRC 529 education savings income tax deduction

HB 845 increases the state income tax deduction for individuals contributing to Family Education Savings Accounts (529 plans). Beginning in tax year 2025, the maximum annual deduction for these contributions will rise from $3,000 to $4,500. The bill also establishes an inflation factor to adjust this maximum deduction amount in subsequent tax years based on the consumer price index. These changes apply retroactively to tax years beginning after December 31, 2024, for contributions made to accounts owned by the contributor, their spouse, or a Montana resident child or stepchild.

Topics ✓ Budget & TaxesSupports Budget & TaxesIncreases tax deduction for 529 education savings, providing direct tax relief to individuals through higher annual deduction ($3k→$4.5k) and inflation adjustment.95% confidence ✓ EducationSupports EducationIncreases tax deduction for 529 education savings, directly incentivizing higher education affordability and access through expanded tax benefits.95% confidence

Sub-Topics Income Tax

died · Montana · House May 22, 2025

HB 220: Provide for a child tax credit

HB 220 would establish a refundable child tax credit for Montana resident taxpayers with children under age 5. It provides a $1,200 credit per qualifying child, phasing out for taxpayers with federal adjusted gross income over $56,000 (with a $50,000 phaseout threshold). The credit is refundable, meaning eligible families could receive it as a payment even if they owed no state income tax. The bill also adds the child tax credit to Montana’s required periodic review schedule for tax credits. The bill died in committee on May 22, 2025, and did not become law.

Topics ✓ Budget & TaxesSupports Budget & TaxesProvides refundable tax relief ($1,200 per child under 5) for low/middle-income families, directly advancing tax policy to support families through fiscal means.95% confidence

Sub-Topics Income Tax Tax Credits

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signed · Montana · House Apr 28, 2025

HB 337: Revise income tax laws to lower income taxes

HB 337 revises Montana's income tax laws, affecting individual taxpayers and certain estates or trusts. The bill aims to lower income taxes by adjusting the state's tax brackets. It increases the amount of Montana taxable income taxed at lower rates and reduces the highest income tax rate. Additionally, the bill revises the tax rates and income thresholds applied to net long-term capital gains.

Topics ✓ Budget & TaxesSupports Budget & TaxesBill explicitly lowers income tax rates by adjusting brackets and reducing top rate, providing tax relief for individuals and estates per its summary.95% confidence

Sub-Topics Business Taxes Income Tax

died · Montana · Senate May 23, 2025

SB 538: Provide income tax deduction for qualified business income

SB 538 would allow Montana taxpayers to claim the same qualified business income deduction they use on their federal tax returns under Section 199A of the Internal Revenue Code. This directly affects Montana business owners who operate as sole proprietors, S-corps, or partnerships and qualify for the federal deduction. The bill amends Montana's tax code to automatically include this deduction when calculating state taxable income, aligning Montana's rules with the federal provision. It applies retroactively and takes effect immediately upon enactment. The bill died in committee in May 2025 and was not enacted.

Topics ✓ Budget & TaxesSupports Budget & TaxesProvides tax deduction for business owners, reducing state tax burden. Aligns with federal policy, offering tax relief for small businesses under Montana's tax code.90% confidence

Sub-Topics Business Taxes Income Tax

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died · Montana · House May 22, 2025

HB 827: Revise social security income taxation

HB 827 aimed to revise the taxation of Social Security benefits at the state level in Montana. The bill proposed to modify how the federal calculation for taxing Social Security benefits is applied when determining an individual's state income tax. This change would have directly affected Montana residents receiving Social Security benefits by potentially altering the portion of those benefits subject to state income tax. The bill included provisions for a delayed effective and applicability date.

Topics ✓ Budget & TaxesSupports Budget & TaxesBill revises state tax on Social Security benefits, likely reducing tax burden for seniors (middle/lower income), aligning with tax relief indicator.85% confidence

Sub-Topics Income Tax

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died · Montana · Senate May 23, 2025

SB 531: Provide tax credit for purchase of a firearm safe

SB 531 would provide Montana residents a refundable state income tax credit for purchasing a firearm safe, up to $300 per tax year. To qualify, the safe must meet strict security standards (e.g., 10,000+ lock combinations, 1/2-inch steel bolts, certified by a nationally recognized lab) and fully contain firearms. The credit directly affects individual taxpayers who buy qualifying safes, with unused credit paid back if their tax liability is less than the claimed amount. The bill aims to encourage safe storage but does not change existing firearm laws. It would apply to tax years beginning January 1, 2026, though it died in committee in 2025.

Topics ✓ Budget & TaxesSupports Budget & TaxesBill provides refundable tax credit reducing individual tax liability, directly constituting tax relief per topic indicators.95% confidence

Sub-Topics Income Tax Procurement

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died · Montana · House May 20, 2025

HB 537: Provide for a birth day tax credit for the birth of a child

HB 537 proposed creating a new "birth day" tax credit for resident taxpayers in Montana upon the birth of a child. The credit would be up to $3,000, or the total of the taxpayer's Montana income taxes, federal income taxes, and FICA contributions, whichever is less. This credit would be refundable, allowing taxpayers to receive a refund even if they have no state tax liability. The credit amount would be reduced for higher-income taxpayers and capped at $1,500 in certain situations, such as for parents filing separately or unmarried parents sharing custody. If passed, it would have applied to income tax years beginning after December 31, 2025.

Topics ✓ Budget & TaxesSupports Budget & TaxesProvides refundable tax credit reducing tax burden for new parents, aligning with tax relief for middle/lower income families through direct financial support.95% confidence

Sub-Topics Income Tax Tax Credits

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died · Montana · Senate May 23, 2025

SB 225: Provide income tax credit for renters

SB 225 would create a refundable income tax credit for Montana renters with household income under $45,000. The credit equals the lesser of 4% of rent paid above household income or $500, phasing out completely for incomes of $45,000 or more. It directly affects low-to-moderate-income renters who pay rent in Montana, providing a refund even if they owe no income tax. The bill also amends tax code sections to include this credit in regular review cycles and prohibits claiming it alongside the existing elderly property tax credit.

Topics ✓ Budget & TaxesSupports Budget & TaxesProvides refundable tax credit for low-income renters ($45k income cap), directly reducing tax burden and increasing disposable income for housing costs.95% confidence ✓ HousingSupports HousingProvides refundable tax credit to low-income renters ($45k income cap), directly increasing housing affordability and reducing rent burden for vulnerable tenants.95% confidence

Sub-Topics Business Taxes Income Tax Tax Credits Property Taxes Renters Tenant Rights

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