Montana state income tax
Montana has a state income tax. It is graduated, with a top marginal rate of 5.65%. Two brackets for tax year 2026 (per enacted HB 337, Ch. 227, 69th Legislature, amending 15-30-2103 MCA): 4.7% on the first $95,000 of Montana taxable income (MFJ/surviving spouse), $71,250 (head of household), or $47,500 (single/MFS/estates & trusts); 5.65% on the excess. This is a reduction from the prior 5.9% top rate. Per the bill's own effective-date and termination clauses, these 2026 brackets terminate Dec 31, 2026: for tax years beginning after Dec 31, 2026 (i.e. TY2027+), the top rate drops further to 5.4% with wider brackets ($130,000 MFJ / $97,500 HoH / $65,000 single). Capital gains are taxed under special rules (see below).
Does Montana have a state income tax?
Yes. Montana taxes individual income on a graduated schedule topping out at 5.65%. Two brackets for tax year 2026 (per enacted HB 337, Ch. 227, 69th Legislature, amending 15-30-2103 MCA): 4.7% on the first $95,000 of Montana taxable income (MFJ/surviving spouse), $71,250 (head of household), or $47,500 (single/MFS/estates & trusts); 5.65% on the excess. This is a reduction from the prior 5.9% top rate. Per the bill's own effective-date and termination clauses, these 2026 brackets terminate Dec 31, 2026: for tax years beginning after Dec 31, 2026 (i.e. TY2027+), the top rate drops further to 5.4% with wider brackets ($130,000 MFJ / $97,500 HoH / $65,000 single).
| Item | Montana |
|---|---|
| State income tax | Yes, graduated |
| Top marginal rate | 5.65% |
| Capital gains | Special rules, up to 4.1% |
| State sales tax | 0% |
| Avg. property tax rate | 0.61% of home value |
| Estate / inheritance tax | None |
How does Montana tax capital gains?
Montana taxes capital gains under special rules rather than at the ordinary income rate. The top rate that applies is 4.1%. You still owe federal capital gains tax on top of any state tax. See how capital gains tax works in 2026.
What about retirement income in Montana?
Retirement income is taxed differently from wages in many states. For how Montana treats Social Security, pensions, and 401(k)/IRA withdrawals, see Montana retirement taxes.
Sources
- Montana income tax rates and brackets: Montana Department of Revenue / Taxation.
- Montana capital gains treatment: Montana tax authority.
- Montana sales tax: Montana Department of Revenue.