Montana Department of Revenue

Truncated Forms W-2 and 1099

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Taxes and Fees

Truncated Forms W-2 and 1099

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As a safeguard against identity theft, the Internal Revenue Service (IRS) allows payers to truncate, or shorten, the payee’s taxpayer identification number (SSN, FEIN, or ITIN) on the copy of Form W-2 or 1099 that the payer gives to the payee.

Caution:

  • Payers may not truncate the payee’s Social Security Number on any forms filed with the Montana Department of Revenue, IRS, or Social Security Administration
  • Payers may not truncate their own identification number on any forms given to the payee or filed with the Montana Department of Revenue, IRS, or Social Security Administration

If the forms with truncated information are incorrectly submitted to the Montana Department of Revenue, you may be asked to resubmit them using the correct format.

Learn more about Wage Withholding.

A Special Message for Remote Workers in Montana

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The Montana Department of Revenue has a reminder for anyone who lived in Montana for any time in 2020 and worked at their jobs remotely, including those who temporarily relocated due to the COVID-19 pandemic:

You must pay Montana state income tax on any wages received for work performed while in Montana, even if your job is normally based in another state.

Please contact your tax professional for further details.

Learn more about Montana Residency or see The Montana Individual Income Tax Return Instructions for more information.

Flat icon style art of a person working outside with children playing, mountains, and birds in the background.

Unemployment Benefits and Form 1099-G: Subject to Federal Income Tax, not Montana Income Tax

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Unemployment benefits are considered regular income and are subject to federal income tax, but are exempt from Montana income tax.

This includes benefits received under regular unemployment insurance, any special unemployment compensations authorized under the Coronavirus Aid, Relief, and Economic Security (CARES) Act or Continued Assistance for Unemployed Workers Act of 2020, and the Lost Wages Assistance (LWA) and Interim Pandemic Assistance (IPA) programs.

The 1099-G is a form taxpayers receive that documents these payments from state government, including under regular UI, pandemic, and additional benefit programs. Those who received this form will need it to file their tax returns.

If you have further questions about your 1099-G, call the Montana Department of Labor & Industry at (406) 444-2556.

Those who receive a 1099-G form from DLI but did not file for unemployment benefits are likely victims of identity theft. Anyone who suspects fraud should call (406) 444-0072.

Montana Department of Labor & Industry Logo

The information on this page is related to Forms 1099-G issued from the Montana Department of Labor and Industry for unemployment benefits.

If you are expecting a Form 1099-G issued by the Montana Department of Revenue, see our information regarding Forms 1099-G.

Paycheck Protection Program (PPP) Debt Cancelation Not Taxable

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As a part of the CARES Act and the latest federal COVID-19 relief package, passed in December, the federal government created the Paycheck Protection Program (PPP). The PPP is a loan program that provides cash-flow assistance to small businesses as an incentive for businesses to retain their employees during the COVID-19 pandemic. If the recipient fully spends the funds on payroll costs, interest on mortgages, rent, and utilities, the loan can be fully forgiven.

Any debt from the PPP loans canceled by the Small Business Administration is specifically excluded from taxpayers’ gross income. Because Montana Adjusted Gross Income includes Federal Adjusted Gross Income, this canceled debt is not included in the calculation of Montana Adjusted Gross Income.

The COVID-19 relief package passed in December also allows taxpayers to deduct expenses paid for with funds received from PPP loans. So, those expenses are included in the calculation of Montana Adjusted Gross Income.

Updated January 26, 2021

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Montana Economic Development Industry Advancement (MEDIA) Tax Credit

Montana offers a media credit for certain costs of qualifying film, television, and other media productions

General Requirements

Pre-Certification with the Department of Commerce

First, production companies must be registered with the office of the Montana Secretary of State. Productions should register at least 7 to 10 days before applying.

Before production begins, productions must apply for pre-certification with the Montana Department of Commerce Film Office.

Media Credit Application with the Department of Revenue

To claim the MEDIA credit, productions must apply with the Department of Revenue. The “submission of costs” must be submitted within 60 days of principal photography for the credit to be available in the year of production; otherwise, the credit will be pushed back one year. In addition, as part of the application, a CPA report is due by April 15 of the year following the year of production.

Media Credit Cap

The total amount of tax credits claimed by all productions cannot exceed $10 million in any calendar year:

 202020212022202320242025
Total Credit Reserved$43,196 $0$0$0$0$0
Total Credit Validated$43,196 $0$0$0$0$0
Total Credit Available$9,956,804 $10,000,000 $10,000,000 $10,000,000 $10,000,000 $10,000,000

  • The media credit is reserved when a production company submits a complete media credit application as provided under ARM 42.4.3411.

  • The media credit is validated when the Department has approved a media credit application and issued a media credit with a corresponding unique credit reference number.

  • The total media credit available is the amount of media credit available that can be validated for a particular year.

If the full amount of credit is not utilized, then the remaining credit is not carried forward. For example, if only $5 million of the credit is used in a tax year, the remaining $5 million does not get carried forward to the following tax year.

However, excess validated credit is pushed to the following year. For example, if a production earns $15 million dollars of credit in Year One and the cap has already been reached, the excess credit can be taken in Year Two.

Priority

For purposes of determining priority, priority is based on when the production company submits a complete application, which includes the “submission of costs, CPA report, and application fee.”

The Montana Department of Commerce Montana Film Office has more information, instructions on registering with the Montana Secretary of State and applying for pre-certification. To calculate the credit based on potential expenditures and labor costs visit the Montana Film Office Credit Estimate Calculator. This is only an estimate for your purposes.

Benefit

The credit includes a 20 percent income tax credit on pre-production, production, and post-production expenditures in the state. Additional incentives can increase the credit up to 35 percent of the production’s base investment in the tax year.

These per production, additional incentives include:

  • 25% of compensation for Montana resident crew
  • 15% of compensation for non-Montana resident crew
  • 20% of above-the-line compensation (actor, director, producer, writer)
  • 30% of compensation paid to a student enrolled in a MT college/university who works on the production for college credit
  • 10% of payments to MT colleges/universities for stage, equipment, rentals, or location fees for filming on campus
  • 10% of all in-studio facility/equipment expenditures that rents a studio for 20 days or more
  • 5% of expenditures in an underserved county
  • 5% for using “Film MONTANA” screen credit
  • 25% of post-production wages (Effective Jan. 1, 2021)

Forms

Related Laws

Frequently Asked Questions

Do I submit a media credit application with the Montana Department of Commerce or the Montana Department of Revenue?

Both.

Department of Commerce
You must submit an initial media credit application with the Montana Department of Commerce prior to the commencement of principal photography in Montana. Learn more about the Montana Department of Commerce’s application process.
Department of Revenue
You must also submit a media credit application with the Montana Department of Revenue after you have completed principal photography.

What is considered a complete media credit application?

A complete media credit application consists of the following three items:

  • Submission of Costs
  • CPA Report
  • Media Credit Fee

Where do I file my media credit application?

Submit your application through Montana’s ePass File Transfer System. Contact the Department of Revenue to determine the applicable recipient.

What is the Submission of Costs?

The Submission of Costs includes information used to substantiate the credit and may include the following:

  1. Media credit spreadsheet provided by the Department of Revenue
  2. General ledgers
  3. Invoices/purchase orders
  4. Earnings and payroll reports
  5. Check stubs
  6. Form MEDIA-COMP for each employee and loan-out
  7. Loan-out withholding agreements
  8. Verification of loan-out withholding payments
  9. Other supporting documentation

How should I organize the Submission of Costs

Expenditures
The Submission of Costs should be organized by expenditures and compensation. Expenditures must be coded under the appropriate category and separated into corresponding folders for each category. If purchases were made in an underserved area, then that information should be noted as well. For example, an invoice for craft services should be labeled as Category A and, if appropriate, the applicable underserved county.
Compensation
All compensation should be included in one folder and separated by each individual’s weekly compensation. Compensation should be substantiated by earnings reports, check stubs, and other information needed to verify qualification for the credit. For example, the report must include if the individual was compensated for kit rentals, mileage, time-and-a-half, etc. It must also indicate whether the compensation is sourced to Montana or another state.
Media Credit Fee
Please provide a copy of the check with your Submission of Costs. Submit your fee using the payment voucher.

What is the MEDIA Compensation Claim (Form MEDIA-COMP)?

If you are claiming credit for a particular individual, then Form MEDIA-COMP must be filled out in its entirety, otherwise credit will be denied for that individual.

Provide all of the MEDIA-COMPs in one folder when submitting your application.

What are the requirements for the CPA Report?

Currently, the Department of Revenue does not provide “agreed upon procedures” between the CPA and the Department of Revenue.

However, 15-31-1006, MCA does provide that the report must:

  • Be issued by a CPA who is unrelated to the production company;
  • Be performed in accordance with accounting standards generally accepted in the United States;
  • Be addressed to the person who engaged the accountant, with a copy addressed to the production company, post-production company, or person who applied for the credit;
  • Include the accountant’s name, address, and telephone number;
  • Include the date of completion of the accountant’s work; and
  • Contain a statement of acknowledgment by the accountant that the state is relying on the report to issue tax credits.

For additional information, see ARM 42.4.3413

Where can I find a CPA to help with the CPA Report?

Please inquire with the Department of Commerce’s Film Office regarding a list of CPAs involved with the MEDIA credit.

When do I submit my MEDIA credit application to the Department of Revenue

Once you have completed principal photography, you will need to submit your Submission of Costs to the Department of Revenue within 60 days of principal photography (which includes wrap) if you would like to claim the credit in the year of production. The CPA Report must be submitted by April 15 of the year following the year after completion of principal photography. Time computation for deadlines falling on weekends or holidays shall conform to 1-1-307, MCA, which provides any acts required to be done may be performed upon the next business day with the same effect as if it had been performed upon the day appointed.

The CPA Report must be submitted by the April 15 due date to be eligible for the credit.

Example:

If principal photography is completed on August 21, 2020, then the Submission of Costs must be submitted by October 20, 2021 to claim the credit for the 2020 tax year. The CPA Report would be due April 15, 2021. However, if the Submission of Costs is not submitted within 60 days of principal photography, thereby rendering the credit a 2021 media credit, then the CPA Report is not due until April 15, 2022.

What happens once I submit my MEDIA Credit application to the Department of Revenue

The Department of Revenue will notify you by either email or letter that it has received your application and will follow-up with any additional questions.

After the Department of Revenue completes its audit of your application, you will receive a confirmation letter with the approved credit amount and a Unique Identification Registration Number (UCRN), which you will need to take the credit on your Montana tax return or to transfer the credit.

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