Montana Property Taxes
Overview of Montana Property Taxes
Montana property taxes are a major source of funding for local government services including schools, infrastructure, and law enforcement. Almost half of the property taxes collected in Montana come from homeowners. Property taxes are administered and collected by local authorities. Each year, the state and its local governments collect $9 billion in total revenue. Of that, $1.7 billion or 18.12% of total revenue comes from property taxes. The average homeowner pays $7.68 for every $1,000 of home value in property taxes.
The average Montana property tax bill adds up to $1,786. However, the amount of taxes you pay depends on the location of your property. Different counties have different tax rates. For instance, homeowners in Big Horn County pay an average of $627 while those in Flathead County pay $2,170.
How do Montana property taxes work? Montana property taxes are based on your property's "taxable value" and the tax rates as set by the local taxing authorities. The taxable value is based on your property's assessed value or the amount an unobligated buyer would pay for the property. However, the process of calculating the taxable value is not as straightforward as in other states.
The process starts with property appraisal. Before 2015, state appraisers were only required to reappraise property once in six years. However, current state laws dictate that properties be reappraised every two years. Reappraisals are conducted to determine the current market value for each property. If the reappraised value is bigger than the preceding one, the difference is spread out over the next two years. Assuming your property was assessed at $100,000 in 2018 and $120,000 in 2020, the difference of $20,000 would be phased in over the two years. This means your property's assessed value would increase by $10,000 each year between 2020 and 2022. Montana property taxes are based on the new value.
Your property's assessed value is then multiplied by the tax rates to get taxable value. Montana property tax rates are mainly determined by local taxing authorities depending on their budgetary requirements. However, the state of Montana also collects taxes to support education. Tax rates are expressed in mills/millage rates where every mill is equivalent to $1 for every $1,000 of your property's taxable value. This means a mill equals a millage rate of 0.001. The taxable value is multiplied by the previous millage rate to get your annual Montana property tax bill.
If you are planning to buy a home in Montana and want to understand how much your property tax bill could potentially cost, check out our Montana Property Tax Tool to see what your bill would be.
Montana Property Tax Due Dates
The fiscal year in Montana runs from July 31 to June 30. Properties must be valued as of January 1 with homeowners receiving their tax bills approximately the last week of October. The Montana property tax bill contains, among others, details of your property's assessment and special fees. Failure to receive a tax bill does not excuse you from paying property taxes. Homeowners who fail to receive a tax bill should consult their County Assessor's Office.
But when are property taxes due in Montana? The state allows homeowners to pay Montana property taxes in two installments. The first installment is due by close of business on November 30 of the current year. The second installment is payable on or before May 31 of the following year. If a due date falls on a weekend or holiday, it is pushed to the next business day. Each of the "half" payments becomes delinquent if not paid by the due dates.
Taxes that remain unpaid after Montana property tax due dates result in a penalty of 2%. Interest also accrues on the principal bill at a rate of 10% per annum. Penalties and interest accrue each year the taxes remain delinquent. If you fail to pay Montana property taxes for a long period, you can lose your home in a "Tax Sale", a public auction in which the highest bidder takes ownership of your property.
Montana Property Tax Exemptions
Besides offering you the option to appeal property taxes if you have reasons to disagree with the valuation of your property, the state of Montana offers several exemptions to eligible homeowners. They include the senior and homestead exemptions. The exemption provides property tax relief and can significantly reduce your Montana property tax bill. However, you must still comply with Montana property tax due dates regardless of your eligibility.
Montana Homestead Exemption
Montana's homestead exemption is also known as the homestead declaration. Under this provision, you can protect up to $250,000 of your property's value from creditors in case of bankruptcy. The amount doubles for married couples. You must legally own and reside in the property as your principal residence to qualify. However, this exemption has no bearing on the accrual of Montana property taxes.
Montana Senior Citizens Exemption
Montana's version of the senior exemption is also known as The Montana Elderly Homeowner/Renter Credit program. Under this property tax relief program, elderly homeowners aged at least 62 years receive a tax credit of up to $1,000. The homeowner must also have lived in Montana for the last nine months and meet certain income limit requirements. The amount of credit received by homeowners is based on their household income, rent, and property tax.
Other Montana property tax exemptions include the Montana Disabled Veteran Assistance Program which provides relief on property taxes. Veterans whose disabilities are 100% related to military service and their surviving unmarried spouses are eligible. The veterans have to meet certain income limit requirements. Depending on their income, eligible veterans can reduce their Montana property tax bill by 50 to 100 percent on their principal residence.
How to Appeal Your Property Taxes in Montana
The state of Montana allows you to appeal property taxes if you have reasons and evidence showing your property was overvalued. A successful appeal can significantly lower your Montana property taxes. The first step of appeal is an informal meeting with the Department of Revenue where you talk with an appraiser. Many concerns and misunderstandings are solved at this level. However, you can forego the informal process and appeal directly to the local County Tax Appeal Board (CTAB) within 30 days of receiving your Notice of Classification and Appraisal. Decisions by the CTAB can be appealed to the Montana Tax Appeal Board within 30 days of receiving the decision. It is noteworthy that you can only appeal your property's valuation, not the property taxes.
The process of filing an assessment appeal varies across Montana though it generally follows the same steps from county to county:
- Obtain your assessment
- Determine if you are overassessed
- Complete forms needed to appeal
- File property tax appeal
- Prepare for hearing
- Attend hearing
- Appeal the decision
How to Appeal Your Property Taxes in Yellowstone County
To help you understand how to appeal your property taxes in Montana, here is a breakdown of the process in Yellowstone County, the most populous county in Montana.
Obtain your assessment
Details about your property's assessment can be easily obtained on your Notice of Classification and Appraisal. You may also contact your local assessor.
Determine if you are over-assessed
One way to determine if your property's valuation reflects its market value is by comparing recent sales of similar units within your locality. TaxProper's search tool can help you look for sales of similar properties within your neighborhood and see how their sales prices compare to the value placed on your property.
Complete forms needed to appeal
File property tax appeal
Property tax appeals in Yellowstone County are filed with the Yellowstone County Clerk and Recorder.
Prepare for hearing
Simply stating that your property is over-assessed is not sufficient grounds for an appeal. Preparing for an appeal hearing involves collecting and organizing evidence justifying your opinion of value. This can include but is not limited to comparable sales, photos showing the undesired conditions of the property and its surroundings, and testimony from an expert witness.
Both the taxpayer and an appraiser from the Department of Revenue, typically the one who conducted the appraisal, must appear before the County Tax Appeal Board. The Board cannot grant any value reduction if you or a representative fail to attend the hearing to answer questions.
Appeal the decision
Decisions by the CTAB can be appealed to the Montana Tax Appeal Board within 30 days of receiving the CTAB's decision.
Property Tax Information for Montana Counties
The table below provides county-level information about how property taxes work in each Montana county.
Want to learn more? Click the county links to learn more about a specific Montana county.
|County||Average Home Value||Average Tax Bill||Bill per $1,000|
|Big Horn County||$119,693||$627||$5.20|
|Deer Lodge County||$162,495||$1,367||$8.40|
|Golden Valley County||$149,379||$847||$5.70|
|Judith Basin County||$194,773||$1,222||$6.30|
|Lewis and Clark County||$226,523||$1,963||$8.70|
|Powder River County||$180,327||$1,463||$8.10|
|Silver Bow County||$152,924||$1,471||$9.60|
|Sweet Grass County||$471,898||$1,771||$3.80|