New Individual Income Tax Rate

January 10, 2022

This article was first sent as part of the Tax News You Can Use Newsletter
Sign up to get updates delivered directly to your inbox.

Senate Bill 159, passed during the 67th Montana Legislative Session, reduced the highest marginal tax rate for individuals, estates, trusts, and pass-through entities. This reduction begins with the 2022 tax year. The highest tax rate will decrease from 6.9% to 6.75% on any taxable income over $19,800. Montana currently has seven marginal tax rates. The bill did not affect the six lowest marginal rates.

This bill is subject to the ARPA Savings Clause; therefore, the rate can revert to the current highest marginal tax rate of 6.9% if the savings clause is triggered. For 2022, however, the clause was not triggered, thereby assuring that the new rate will be in effect for that year.

2021 Legislative Roundup

The 67th Montana Legislature made several changes to Montana’s tax laws. To help you sort out the changes, we have created a series explaining the new laws called the 2021 Legislative Roundup.

This article is a part of our 2021 Legislative Roundup series.