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Other Information


Sales Tax and State Fees 
Tax Assistance
Tax Fraud
Taxpayer Delinquent List
Tribal/State Agreements
Voluntary Disclosure

General Individual Income Tax Information

Income tax revenues are collected primarily through employer withholding, periodic estimated tax payments, and payments made when the return is filed. Income tax revenues are distributed 100% to the general fund.

Electronic filing of the Montana income tax return along with the federal return is available. Direct deposit of refunds is available to all filers along with direct deposit to automatically pay your tax liability when you electronically file your return.

Montana residents are taxed on all income, regardless of source, except that income which is statutorily exempted from taxation. Part-year residents and nonresidents are taxed on all Montana source income that is derived from or connected to Montana sources. Additionally, part-year residents are taxed on all non-Montana source income generated during or attributable to the period of the tax year in which they resided in Montana.


Montana's individual income tax was enacted in 1933 and continues to this day to be the largest source of state tax revenue. The state's income tax is viewed as a "progressive" tax system because of the distribution of tax burden and because income is taxed according to a graduated rate structure with rates ranging from 1% to 6.9% of taxable income.

Taxable income is derived from gross income by making certain adjustments and taking a variety of allowable deductions and exclusions. This tax generally applies to the net income of Montana residents and nonresidents.

"Tie to Federal" Alignment

Probably the most significant feature of Montana's income tax is the substantial reliance on the federal tax code. Often described as a "tie to federal" alignment, this reliance allows the state to establish the essential elements of this tax system by direct reference to federal definitions of income and deductions, and federal reporting procedures and protocol.

This reliance is common among the 43 other states imposing individual income taxes. Most importantly, this approach allows both the state and its taxpayers to realize significant operating efficiencies. Without this parallel structure, Montanans would face increased complexity and substantially higher compliance costs.

The income tax statutes do, however, reflect Montana-specific tax policy as determined by previous legislative assemblies. These policy directives are found in the areas of additions and subtractions to federal adjusted gross income, unique itemized deductions, and tax credits.


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Information Disclosure

Frequently Asked Questions - Disclosure Office: Confidentiality and Sharing of Tax Information FAQs


Authorization to Disclose Tax Information - For Taxpayers

If you would like your tax preparer to have access to information about your taxes. You can choose from the two options below:

Option #1 - Power of Attorney

You can give your tax preparer authorization to discuss with us the current year’s filed return during our processing of it by checking the box on the bottom of the return. You can also complete and submit a Power of Attorney (POA) form giving your tax preparer access to specified account information for past and current years and up to three years in the future. That will give your preparer access to specified account information for past and current years and up to three years in the future. Under this option, you will also need to complete and submit a POA form, necessary for allowing your preparer access to information about your estimated payments as he or she prepares your return. (See Frequently Asked Questions on confidentiality.)

Keep in mind:

-We generally process completed POA forms within one day of receipt.
-Incomplete or inaccurately completed POA forms will increase our process time as we will need to consult with you to complete or correct the POA.
-If you are filing a Montana tax return for the first time, some delay will occur because we first must process your return before we can create an account to which the POA can be attached.

To complete option #1:

-you or your tax preparer needs to:
 

(a) Use the check-the-box authorization on the current return.
(b) Fax an accurate and complete Power of Attorney (Form POA) to (406) 444-4375 or
(c) send an electronic Power of Attorney.

-We will accept Federal Form 2848 in place of Form POA, if Section 3, Tax matters, identifies “Montana” and the type of tax, tax form number, and the applicable year(s). Fax to (406) 444-4375.

-Your tax preparer can then call the department’s Call Center (406) 444-6900. The Call Center will provide the appropriate information — as authorized by either the check-the-box or the POA. Again, please understand that the check-the-box and the POA provide different access to your information.

-To discuss your estimated payments with your tax preparer, we would require a POA because the payments are for a tax return not yet filed.


Option #2 - Authorization through the TransAction Portal (TAP)

You can authorize your tax preparer access to specific account information through the TAP.

To complete option #2:

1. You and your tax preparer need to establish TAP accounts.

-Your tax preparer needs to establish an account only once, but the account must have been established before you can grant the preparer access to your account.
-Similarly, you must establish an account before you can grant specified access to your tax preparer.

2. Your tax preparer needs to request from his or her account permission to access to your account.

3. You immediately receive notification by e-mail of your tax preparer’s request. The notification contains a link to your account from which you can grant the tax preparer access. The different levels of access that can be granted are "view," "view and file," or "full access" (view, file and pay).

4. Your tax preparer immediately receives an e-mail that access has been granted.

5. Your tax preparer can then access your information at the level you have specifically authorized.

Authorizing access for a tax preparer requires the following:

You will need:

-access to the internet
-an established account in TAP
-access to an e-mail account or a cell phone with text messaging
-your social security number and/or Montana Account ID
-for individual income tax, your federal adjusted gross income for the previous year

Your preparer will need:

-access to the internet
-an established account in TAP
-your last name
-your social security number and/or Montana Account ID
-for individual income tax, your federal adjusted gross income for the previous year

View detailed instructions of how to access this information at  TAP or, call us at (406) 444-6900.
 

Authorization to Disclose Tax Information - For Tax Preparers

If you need to access information about your client's tax returns, choose from one of the two options below:

Option #1 - Power of Attorney

Your client can give you authorization to discuss with us his or her current year’s filed return during our processing of it by checking the Power of Attorney box on the return. Your client can also complete and submit a Power of Attorney form giving you access to specified account information for past and current years and up to three years in the future. Under this option, the POA is necessary if you need to access information about your client’s estimated payments as you prepare his or her return. (See Frequently Asked Questions on confidentiality.)


Keep in mind:

-We generally process accurately completed POA forms within one day of receipt.
-Incomplete or inaccurately completed POA forms will increase our process time since we will need to consult with the taxpayer to complete or correct the POA.
-If your client has filed a Montana tax return for the first time, some delay will occur because the department must process the return before we can create an account to which the POA can be attached.

2. To complete option #1:

1. Use the check-the-box authorization on the current return.
2. Fax an accurate and complete Power of Attorney (Form POA) to (406) 444-4375, or
3. Send an electronic Power of Attorney

We will accept Federal Form 2848 in place of Form POA, if Section 3, Tax matters, identifies “Montana” and the type of tax, tax form number, and the applicable year(s). Fax the form to the same number, (406) 444-4375.

You can then call the department’s Call Center at (406) 444-6900. The Call Center will provide the appropriate information — as authorized by either the check-the-box or the POA. Again, please understand that the check-the-box and the POA provide authority to access different information concerning the taxpayer.

-To discuss your client’s estimated payments, we would require a POA because the payments are for a tax return not yet filed.

Option #2 - Authorization through the TAP

Your client can give you access to specific account information through the TAP.

To do this:

1. Both you and your client need to establish TAP accounts.

-You need to establish an account only once, but your account must be established before your clients can grant you access to their accounts.
-Each client must establish an account to which he or she grants specified access to you.

2. You need to request from your account access to your client’s account.

3. Your client immediately receives notification by e-mail of your request. The notification contains a link to his or her own account from which he or she can grant you access. The different levels of access that can be granted are "view", "view and file," or "full access" (view, file, and pay).

4. If the client does so, you will immediately receive notification that access has been granted.

5. You can then access the account information at the level your client has specifically authorized.

Authorizing access to your client’s account requires the following:

Your client will need:

-Access to the internet
-An established account in TAP
-Access to an e-mail account
-His or her social security number and/or Montana Account ID
-For individual income tax, his or her federal adjusted gross income for last year

You will need:

-Access to the internet
-An established account in TAP
-Your client’s last name
-Your client’s social security number and/or Montana Account ID
-For individual income tax, your client’s federal adjusted gross income for last year

View detailed instructions of how to access this information at TAP or, call us at (406) 444-6900).


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Frequently Asked Questions


Amended Returns
Income Tax Liability
Information Changes
Energy Related Credits
Estimated Tax Payments
Extensions
Filing Deadlines and Due Dates
Filing Requirements
Filing Status
Form 1099-G and Form 1099-INT
Injured Spouse
Innocent Spouse Relief
Itemized Deductions
Keeping Records
Late Filed Returns
Mailing Addresses
Military Personnel
Native American Filers
Nonfilers
Part Year/Nonresidents
Penalties and Interest
Retirement Income
Power of Attorney
Reciprocity
Refund Information
Senior Citizens
Tax Form Info
Tax Rates
Tip Income
Treasury Offset Program
Wage/Tax Statements

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Previous Year Forms


2015 Forms
2014 Forms
2013 Forms
2012 Forms
2011 Forms
2010 Forms
2009 Forms
2008 Forms
2007 Forms
2006 Forms
2005 Forms

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Current Year Forms

Individual Income Tax Rates
- 2016 Individual Income Tax Rates

- 2017 Individual Income Tax Rates

 

2016 Individual Income Tax
Individual Income Tax Payment Voucher - Use this form for current year, estimated tax, extension, or amended return payments.
Interactive 2016 Form 2 (MCA and ARM citations)
Montana Code Annotated - Chapter 30: Individual Income Taxes

2016 Instruction Booklets

2016 Montana Individual Income Tax Form 2EZ Booklet (short form)
- 2016 Montana Individual Income Tax Form 2 Booklet (long form) 

2016 Montana Individual Income Tax Forms
- 2EC - Montana Elderly Homeowner/Renter Credit
- 2EZ - Montana Individual Income Tax Return - short form
- 2 - Montana Individual Income Tax Return - Long Form

Form 2 Schedules 1-8
- Schedule I - Montana Additions to Federal Adjusted Gross Income
- Schedule II - Montana Subtractions to Federal Adjusted Gross Income
- Schedule III - Montana Itemized Deductions
- Schedule IV - Nonresident/Part-year Resident Tax
- Schedule V - Montana Tax Credits
- Schedule VI - Credit for Income Tax Liability Paid to Another State or Country
- Schedule VIII - Reporting of Special Transactions

Form 2 Worksheets

- Worksheet II - Tax Benefit Rule for Federal Income Tax Refund
- Worksheet III and IV - Qualified Capital Gain Exclusion and Partial Pension and Annuity Income Exclusion
- Worksheet V, VI-QMIP, VI-IDL - Standard Deduction, Qualified Mortgage Insurance Premiums Deduction and Itemized Deduction Limitation Worksheets
- Worksheet VII - Calculation of Interest on Underpayment of Estimated Taxes - Short Method
- Worksheet VIII - Taxable Social Security Benefits
- Worksheet IX - Tax Benefit Rule for Recoveries of Itemized Deductions

2016 Montana Individual Income Tax Supplemental Forms and Instructions

ADD-CH - Change of Address (Use this form if you file individual income tax Forms 2, 2EZ or 2EC)
2441-M - Child and Dependent Care Expense Deduction:  2016 Form
AEPC - Alternative Energy Production Credit:  2016 Form
AFCR - Alternative Fuel Credit:  2016 Form
AMD - Montana Individual Income Tax Amended Return Reconciliation 
BBSC - Biodiesel Blending and Storage Credit:  2016 Form
CC - College Contribution Credit:  2016 Form
DCAC - Dependent Care Assistance Credits:  2016 Form
DS-1 - Disability Income Exemption:  2016 Form
ECC - Elderly Care Credit:  2016 Form
ELC - Emergency Lodging Credit (formerly Form TELC):  2016 Form
ENRG-A - Geothermal System Credit:  2016 Form
ENRG-B - Alternative Energy System Credit:  2016 Form
ENRG-C - Energy Conservation Installation Credit:  2016 Form
ESA - Estimated Tax Annualization Worksheet: 2016 Form, 2015 Form
EST-I - Underpayment of Estimated Tax by Individuals and Fiduciaries:  2016 Form
ESW - Montana Individual Estimated Income Tax Worksheet: 2016 Form, 2015 Form
ETM - Enrolled Tribal Member:  2016 Form
EXT - Extension Payment Worksheet:  2016 Form
FRM - Farm and Ranch Risk Management Account:  2016 Form
FTB - First Time Home Buyer Savings Account: 2016 Form
HI - Health Insurance For Uninsured Montanans Credit:  2016 Form
MHPE - Mobile Home Park Exclusion:  2016 Form
MINE-CRED - Mineral and Coal Exploration Incentive Credit:  2016 Form
MSA - Montana Medical Care Savings Account:  2016 Form
MT-R - Reciprocity Exemption from Withholding for North Dakota residents who work in Montana
NOL - Montana Net Operating Loss:  2016 Form
NOL-Pre-99 - Net Operating Loss Worksheet:  2016 Form
POA - Power of Attorney
QEC - Qualified Endowment Credit:  2016 Form
- Single Life Expectancy Table
- Two Life Expectancy Table
RCYL - Recycling Credit/Deduction:  2016 Form
VT - Veterans Program Contribution/Deduction:  2016 Form