Tax News You Can Use

Updates to Montana Wage Withholding

December 12, 2018 by Montana Department of Revenue

The following letter was mailed to all active Montana employers on December 4, 2018:

We have important news! Your Montana Annual W-2 1099 Withholding Tax Reconciliation Return (MW-3) will no longer be mailed every year.

The most accurate and efficient way to file your MW-3 by January 31 is electronically through the Department of Revenue’s TransAction Portal (TAP). To file your return online, please:

Sign into your TAP account at https://tap.dor.mt.gov
If you do not have an account, select New user; then Setup online access; and follow the instructions.
Note: You will need your Montana account ID (xxxxxx-xxx-WTH) and Federal Employer Identification Number (FEIN) to set up the account.
File your MW-3, W-2s and 1099s. There are two options to file these forms in TAP: You can manually enter the forms, or upload files generated by approved payroll software. Further instructions are located on the back of this letter.

If you cannot file electronically and need a paper return, visit our website at https://mtrevenue.gov.

New beginning in 2019!

Form MW-4 “Montana Employee’s Withholding and Exemption Certificate” is a new form available for Montana employees to calculate their Montana income tax withholding.

Due to changes in federal tax laws, the federal Form W-4 should not be used by new employees for the calculation of Montana income tax withholding.
If current employees are satisfied with the Montana withholding, they do not need to complete the new Form MW-4 unless they are claiming an exemption from withholding.

If you have questions or need assistance, contact our Call Center at (406) 444-6900.

Single/Manual Entry of MW-3

Sign into TAP.
Select your Withholding account.
Select the File return link for the appropriate tax year and complete the form.
Note: Payments made throughout the year are already populated on the MW-3.
Verify that the withholding and payment totals are correct on lines 4 and 5. If the totals are not correct, you can adjust the amounts reported in Column C and Column D.
You can also add/delete lines if necessary.
After completing all required fields and verifying the information is correct, select Submit.

Single/Manual Entry of W-2s and 1099s

Sign into TAP.
Select your Withholding account.
Select File single W-2 or 1099 forms.
Note: 1099s can only be entered if they have state withholding.
Enter the tax year of the forms you are filing.
Verify address information on the Employer/Payer Information screen.
Select the type of form that you want to enter and select Add.
Once you have entered all your forms, select Submit.

File Upload

The TAP File Upload feature can be used with Montana Department of Revenue approved payroll software products.

Generate the files from your payroll software and save them to your computer.
Sign into TAP.
Select Register to upload W-2, 1099 or withholding files and follow the steps provided.
Return to your TAP homepage and select the File processing account.
Select Submit new file and follow the steps provided.

Department of Revenue Adds Two New Members to Leadership Team

September 5, 2018 by Montana Department of Revenue

Department of Revenue Director, Gene Walborn, has announced two major additions to the department’s leadership team:

Shauna Helfert

Shauna Helfert
Deputy Director

Shauna Helfert began as Deputy Director of the Montana Department of Revenue in early August. Helfert has been with the department for 24 years, serving most recently as the administrator of the Property Assessment Division. Previously, she was administrator of the Alcoholic Beverage Control Division for 12 years and served in various other roles within the department.

Helfert has earned two Governor’s Awards and is a 2015 graduate of Leadership Montana. She has a bachelors’ degree in Accounting from Montana State University.

Manuel Soto

Manuel Soto
Chief Information Officer

Manuel Soto is the new Chief Information Officer at the Montana Department of Revenue. Soto has more than 28 years in information technology, including 20 years in government. He has a law degree from the Cal Northern School of Law in Chico, Calif., plus degrees in Computer Science and Management Development.

Soto will manage the office responsible for technology support across the department and for improving IT services for the public.

Please join us in welcoming them to their new roles.

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Department of Revenue Administrative Rule Update

May 2, 2018 by Montana Department of Revenue

The department adopted the following proposed amendments and new rules effective April 28, 2018.

Pension and Annuity Income Exclusions, Dependent Exemptions, and Medical Care Savings Accounts

MAR Notice 42-2-989

The proposed amendments included minor housekeeping changes, however, amendments to rules pertaining to dependent exemptions clarify the meaning of a “child” and provide better guidance on how to claim the additional exemption for a dependent child with a disability. Amendments related to Montana Medical Savings Accounts largely implement House Bill 175, enacted by the 2017 Legislature.

Withholding Taxes

MAR Notice 42-2-990

The proposed amendments included minor housekeeping changes, revise the due date for filing the annual reconciliation and wage statements in accordance with House Bill 63, L. 2017, and clarify how a pass-through entity treats a credit for mineral royalty withholding, including how it distributes the credit to owners.

Pass-through Entities

MAR Notice 42-2-991

The proposed amendments and New Rule I (42.9.112, ARM) related to the allocation and apportionment of income earned by a pass-through entity, in general, and with respect to the new sourcing rules provided in House Bill 511, L. 2017. New Rule II (42.9.303) provides guidance on how guaranteed payments made to a partner are sourced to the state.

Read more about Sourcing Guaranteed Payments.

Tax Year 2018 Updates to Exemption for Dependent Child with Disability

May 2, 2018 by Montana Department of Revenue

The exemption for a dependent child with disability is twice the amount of the personal exemption. In 2018 this exemption is $4,880 (2 x $2,440). To be eligible, the taxpayer must provide written documentation by a licensed physician showing that the child has a permanent disability constituting not less than 50% disability to the body as a whole.

Starting with the 2018 tax year, the taxpayer must submit the required medical documentation with their tax return when claiming the exemption for a child with a disability for the first time. In the past, taxpayers only needed to keep the documentation with their tax records.

Taxpayers who began claiming this exemption continuously prior to tax year 2018 are not required to provide this documentation with the 2018 return.

If a taxpayer stops claiming this exemption for a year or more, the initial written documentation from the certified physician becomes invalid. In order to claim the dependent child with a disability exemption again, a new certification must be provided.

Notice of Assessment (NOA) Letters Mailed

May 2, 2018 by Montana Department of Revenue

The Department of Revenue is mailing individual income tax Notice of Assessment (NOA) letters for tax year 2017.

If you or your clients have any questions or concerns regarding the NOAs, please contact us. In some cases, a payment may not have been applied as expected if it was submitted without the appropriate information. Department employees can research and make corrections if necessary on payments made for the 2017 tax year.

The NOA is period-specific and includes information about appeal rights and payment options.

The late payment penalty, which is shown on the NOA for informational purposes, can be automatically waived if tax and interest is paid in full within 30 days.

The department mails Statements of Account (SOA) to taxpayers on the first of each month if the balance due on the NOA was not paid within 30 days. The SOA also includes additional information helpful to the taxpayer and will include multiple tax periods if applicable.

Payment Options	File Options
TransAction Portal	TransAction Portal
Income Tax Express	My Revenue
Business Tax Express	Free File Alliance

Tax News You Can Use

Updates to Montana Wage Withholding

Department of Revenue Adds Two New Members to Leadership Team

Shauna Helfert

Manuel Soto

Resources

Administrative Rules

Administrative Rules

Citizen Resources

Citizen Resources

Committees

Committees

Government Resources

Government Resources

Publications

Publications

Tax News You Can Use