Montana Department of Revenue

Updates to Montana Wage Withholding

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News and Updates

Updates to Montana Wage Withholding

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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:

  1. 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.
  2. 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

  1. Sign into TAP.
  2. Select your Withholding account.
  3. 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.

  4. 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.
  5. After completing all required fields and verifying the information is correct, select Submit.

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

  1. Sign into TAP.
  2. Select your Withholding account.
  3. Select File single W-2 or 1099 forms.
    Note: 1099s can only be entered if they have state withholding.
  4. Enter the tax year of the forms you are filing.
  5. Verify address information on the Employer/Payer Information screen.
  6. Select the type of form that you want to enter and select Add.
  7. 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.

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

Draft 2018 Individual Tax Form Available

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The Draft 2018 Montana Individual Income Tax Return (Form 2) (PDF, 346 KB) is now available for your review.

Please note the following changes:

Redesigned Form 2
We made changes to match the redesigned federal Form 1040.
We streamlined the Form 2 Layout to make the filing experience simpler and easier. For example, we’ve grouped related schedules and worksheets.
Eliminated Form 2EZ (Short Form)
Taxpayers who filed the short form in the past will need to file a Form 2. As part of the Form 2 redesign, most former 2EZ filers should need to complete only the first page.
Elderly Homeowner/Renter Credit
The Form 2EC is no longer available. Instead, the credit is calculated on a schedule included with the Form 2.
Individuals who qualify for the elderly homeowner/renter credit but do not have an income tax filing requirement can apply for this credit online using the TransAction Portal (TAP).
Taxpayers who do not have an income tax filing requirement but still wish to claim the elderly homeowner/renter credit using paper will need to complete pages 1 and 9 of the new Form 2.

We are committed to assisting you with any questions you may have about your filing requirements, especially regarding changes to the federal and state income tax forms.

Contact us for more information.

Download the Draft 2018 Montana Individual Income Tax Return (Form 2) (PDF, 346 KB)

Montana Corporate Income Tax Treatment of IRC Section 965(a) Income

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2017 and 2018 Montana Corporate Income Tax Return

Water’s Edge Filers

Taxpayers who file on a water’s edge basis should attach their IRC 965 Transition Tax Statement to their Montana return. Add the total amount of gross income from 965 dividends on Page 3, line 2i, of the Montana Form CIT “other additions.” Deduct 80% of the total amount of gross income from 965 dividends on Page 3, line 3g, of the Montana Form CIT “other reductions.”

If any of the 965 dividends included in “other additions” are from subsidiaries included in the Montana water’s edge filing and incorporated in tax haven countries listed in Section 15-31-322, MCA, deduct 100% of the total amount of gross income related to these entities on Page 3, line 3g, of the Montana Form CIT “other reductions.”

Worldwide Filers

Taxpayers who file on a worldwide basis should attach their IRC 965 Transition Tax Statement to their Montana return. Add the total amount of gross income from 965 dividends reported on Page 3, line 2i, of the Montana Form CIT “other additions.” Deduct 100% of the total amount of gross income from 965 dividends received from unitary subsidiaries included in the Montana worldwide filing on Page 3, line 3g, of the Montana Form CIT “other reductions.”

If any of the 965 dividends included in “other additions” are from subsidiaries that are not included in the Montana worldwide filing, no Montana deduction is allowed related to this income.

Separate Company, Domestic or Limited Combination Filers

Attach your IRC 965 Transition Tax Statement to your Montana return. Add the total amount of gross income from 965 dividends reported on Page 3, line 2i, of the Montana Form CIT “other additions.” Deduct 100% of the total amount of gross income from 965 dividends received from unitary subsidiaries included in your Montana filing on Page 3, line 3g, of the Montana Form CIT “other reductions.”

If any of the 965 dividends included in “other additions” are from subsidiaries that are not included in your Montana filing, no Montana deduction is allowed related to this income.

Retail Alcohol License Bidding Updates

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The following competitive bidding opportunities closed at midnight on September 20, 2018:

  • Belgrade Beer License
  • Bozeman All-Beverage Floater License
  • Three Forks All-Beverage Floater License

We are reviewing the results but cannot release the identity of bidders, the number of bids, or the bid amounts until the highest bidder has been approved.

We have also canceled the following competitive bidding opportunities:

  • Bozeman Beer License
  • Three Forks Beer License
  • Townsend All-Beverage Floater License

We will reevaluate the market value of these licenses and offer them in a future competitive bidding opportunity.

Department of Revenue Adds Two New Members to Leadership Team

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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

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.

Department of Revenue Urges Montanans to Check for Unclaimed Cash and Property

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Thousands of Montanans have assets waiting in trust.

HELENA – Every year in Montana, millions of dollars and other personal assets go unclaimed. And every year, the Montana Department of Revenue encourages individuals and businesses to check whether some of that might be theirs.

The unclaimed property can come from a variety of sources such as forgotten bank accounts, uncashed checks and money orders, insurance policy payments and unused gift certificates, as well as stocks, bonds and the contents from safe deposit boxes. By law, the Montana Department of Revenue holds unclaimed property in trust indefinitely for owners to claim.

Montanans can check their local newspapers over the next few months for ads and inserts from the department listing the owners of property that’s been reported as unclaimed during the last year.

Anyone can also check online for property that may be theirs, regardless of how long ago it was originally reported as unclaimed. Go to tap.dor.mt.gov and click on the “Search for Unclaimed Cash” link to look up names. Follow the on-screen instructions to create and submit a claim.

“This unclaimed property belongs to thousands of individuals across Montana and the country, and the department is committed to returning these assets to their rightful owners,” said Gene Walborn, director of the Montana Department of Revenue. “All Montanans should check their local paper or go online and look for their names, as well as those of their loved ones and recently deceased family members. You never know what you’ll find.”

The department reminds Montanans that while some businesses may offer to help people find their property – for a fee – those commercial services are not necessary. Montanans and others do not have to pay to reclaim their own property, and can submit their claim online in just a few minutes.

For help with a claim or for more information, visit tap.dor.mt.gov, call the department at (406) 444-6900 or email UnclaimedProperty@mt.gov.