On April 29th, the Montana House passed Senate Bill 157, switching from a 6-year reappraisal cycle to a 2-year cycle for all properties other than forest land. By shortening the reappraisal cycle for residential, commercial and agricultural property from six years to two years, legislators said it will help simplify the property tax system, mitigate the fluctuations in market value and increase transparency. Tax year 2015 is the first year of the two-year appraisal cycle (2015-2016). Per the Montana Department of Revenue, value notices are expected to begin being mailed next week. Appeal deadline is 30 days from the date of the value notice. For property tax purposes, it is crucial that real estate owners ensure their appraised property values are accurate. We highly recommend enlisting a property tax professional to review your reassessment notice in order to achieve maximum tax savings.
Last week the Montana House endorsed two major tax bills, one of which will simplify the state's income taxes, while the other would shorten the property reappraisal cycle in an effort to simplify the complicated property tax system. Both House Bills 171 and 157 face a final House vote, but first the House Appropriations Committee will examine their fiscal impacts. SB171, the income tax bill, would revamp state individual income taxes by setting two income tax two tax rates, 4.7 percent and 6.1 percent, as opposed to the seven tax brackets with seven rates ranging from 1 percent to 6.9 percent under current law. Besides simplifying taxes, it also would reduce income taxes by $15 million a year, eliminate some income tax credits, and lower the corporate tax rate to 6.5 percent from the current 6.75 percent rate.
A proposed bill to lower the property tax on business equipment has advanced in the Montana House and Senate this week. According to the Missoulian, Senate Bill 96 aims to exempt from property taxes the first $100,000 worth of business equipment, up from the current $20,000. Additionally, the tax rate would go to 1.5% for the first $6 million worth of equipment, an increase from the current $3 million.