Montana

Tax Rate Range: - 1%; High - 6.9%
Income Brackets: Lowest - $2,399; Highest - $14,500
Number of Brackets: 7
Personal Exemptions: Single - $1,980; Married - $3,960;
Dependents - $1,980
Additional Exemptions: 65 or older - $1,980
Standard Deduction: (2007) 20% of AGI. If single not less than $1,650 or more than - $3,710; If married filing jointly not less than $3,300 or more than $7,420.
Medical/Dental Deduction: Federal amount
Federal Income Tax Deduction: Full
Retirement Income Taxes: There is a $3,600 exemption for public pensions and qualified private pensions. Social Security is taxable for those whose income, including Social Security, exceeds $16,000 (single), $25,000 (head of household) or $32,000 (jointly).
Retired Military Pay: See above. Survivor benefits are taxed following federal tax rules.

State Tax Software

Military Disability Retired Pay:
Disability Portion - Length of Service Pay; Member on September 24, 1975 - No tax; Not Member on September 24, 1975 - Taxed, unless combat incurred. Retired Pay - Based solely on disability: Member on September 24, 1975 - No tax; Not Member on September 24, 1975 - Taxed, unless all pay based on disability and disability resulted from armed conflict, extra-hazardous service, simulated war, or an instrumentality of war.
VA Disability Dependency and Indemnity Compensation: Not subject to federal or state taxes
Military SBP/SSBP/RCSBP/RSFPP: Generally subject to state taxes for those states with income tax. Check with state department of revenue office.

Sales Taxes

State Sales Tax: No general sales tax. A new 3% tax on accommodations and campgrounds is added to the 4% tax on rental vehicles.
Gasoline Tax: 27.8 cents/gallon
Diesel Fuel Tax: 28.6 cents/gallon
Cigarette Tax: $1.70 cents/pack of 20

All property (real or personal) is subject to state and local taxes. The assessed valuation of real property is based on 100% of its fair market value, then reduced by a a phase-in factor and taxed as a percentage thereof. The state established the tax rate to determine the assessed valuation while local taxing units establish the mill levies to determine the property tax. Personal property is also taxed, the most common being motor vehicles. All residential properties receive a 32% exemption (for 2005) but residents must file for the exemption. This homestead exemption incrementally increases until it hits 34% for tax year 2008 and later. Residential property of certain disabled veterans, and the spouses of deceased veterans, is exempt from property taxation. Montana property owners can have their property taxes reduced if they meet certain qualifications. Any homeowner or renter age 62 or over can apply for a credit if they have lived in Montana for 9 months, occupied a residence for 6 months, and has a gross household income of less than $45,000.

Inheritance and Estate Taxes
There is no inheritance tax and no estate tax is due for deaths occurring in 2005 and thereafter.
For further information, visit the Montana Department of Revenue site or call 406-444-6900.
Note: The state has a statutory provision for automatic adjustment of tax brackets, personal exemptions or standard deductions to the rate of inflation.