Montana paycheck guide
How Montana calculates income tax in 2026
Montana has two brackets. For a single filer, the first $47,500 of taxable income is taxed at 4.7% and everything above it at 5.65%. Married couples filing jointly get double the bracket, $95,000, before the higher rate starts.
Montana does not have its own standard deduction or personal exemption. It starts from federal taxable income, the figure left after the federal standard deduction or itemized deductions. That keeps the math simple: once you know your federal taxable income, Montana tax is two multiplications away.
The 2026 change comes from a 2025 law that cut the top rate and moved the bracket threshold up. A second step is scheduled for 2027, with another top-rate cut and a wider 4.7% bracket. Long-term capital gains keep their own lower rates, which matters if you sell investments or property.
Worked example: a $75,000 salary in Montana
Federal tax comes first because Montana builds on it. Subtract the $16,100 federal standard deduction from $75,000 and you get $58,900 of federal taxable income. Federal tax on that is $7,670: $12,400 at 10%, $38,000 at 12%, and $8,500 at 22%.
Montana taxes the same $58,900. The first $47,500 at 4.7% comes to $2,233, and the remaining $11,400 at 5.65% adds $644, for $2,877 in total, a 3.84% effective rate. After $4,650 of Social Security and $1,088 of Medicare, take-home pay is $58,715 a year, about $4,893 a month. The Montana $75,000 salary page shows it per paycheck.
At $150,000, federal taxable income is $133,900. The 4.7% bracket still produces $2,233, and $86,400 at 5.65% adds $4,882, for a Montana bill of $7,114, a 4.74% effective rate.
No local income tax and no sales tax
Montana cities and counties do not tax wages, so a paycheck in Billings, Missoula, Bozeman, or Great Falls has the same state withholding. Montana also has no general statewide sales tax, which is part of the trade-off for an income tax that reaches higher earners at 5.65%.
Some resort communities, such as Whitefish and Big Sky, charge a local resort tax on certain purchases. That affects what you spend, not your paycheck. Montana has no state disability or paid leave payroll deduction, so after income tax and FICA the rest of your pay stub is benefits you choose.
Withholding, Form MW-4, and the North Dakota agreement
Montana employers set withholding from Form MW-4, the state's own certificate. Because Montana tax is tied to federal taxable income, a change on your federal W-4, such as a new dependent or extra deductions, often deserves a matching update on MW-4.
Montana has a reciprocity agreement with North Dakota covering wages. A North Dakota resident working in Montana can claim the exemption on Form MW-4 and must file a new MW-4 each year to keep it. Montana residents working in North Dakota pay income tax only to Montana under the same agreement.
There is no such agreement with Idaho, Wyoming, or South Dakota. A Montana resident who takes a job in Idaho pays Idaho tax on those wages and claims a credit on the Montana return. Wyoming and South Dakota do not tax wages, so Montana residents working there owe Montana tax on the full amount.
How Montana compares with its neighbors
At $75,000, Montana ranks 33rd of 51 for single-filer take-home pay. Wyoming and South Dakota have no wage tax and leave the same worker $2,877 more. North Dakota's tax of $182 leaves $2,695 more. Idaho is nearly identical: its flat 5.3% rate above $4,811 leaves just $10 more. See Montana vs Wyoming and Idaho vs Montana.
The ranking slips to 35th at $150,000, where the 5.65% rate covers most of the income. The 2027 step will narrow the gap again. A Billings family weighing a move to Sheridan, Wyoming, would save the full Montana bill, but only by changing residence: keeping a Montana home and taking a job across the line does not reduce Montana tax.
What to expect at your income
Earning under $50,000
Below $50,000 a single Montana filer stays almost entirely in the 4.7% bracket. At $30,000 the state bill is $653, a 2.18% effective rate, and take-home is $25,632. At $50,000 Montana takes $1,593 and you keep $40,762, about $1,568 every two weeks. Because Montana uses federal taxable income, anything that lowers your federal taxable income, from 401(k) deferrals to HSA contributions, lowers Montana tax too. Check the Montana earned income tax credit if you qualify for the federal one.
Earning $50,000 to $150,000
In this band nearly every raise is taxed at Montana's 5.65% top rate, since single filers cross into it at $47,500 of taxable income. At $100,000 a single filer pays $4,289 to Montana and takes home $74,891, or $6,241 a month. A married couple on one $100,000 salary stays in the 4.7% bracket and pays $3,187, keeping $81,523. Pre-tax retirement contributions save 5.65% in state tax on top of 22% federally for most single filers here.
Earning over $150,000
At $150,000 a single filer pays $7,114 to Montana and takes home $106,677. At $250,000 Montana collects $12,764, 5.11% of salary, and take-home pay is $170,418. The top rate is flat from there, so bonuses and raises cost the same 5.65%. High earners with investment income benefit from Montana's lower capital gains rates, and the 2027 rate cut will trim the bill on wages again.
Montana paycheck tips
Renew MW-4 each year if you live in North Dakota
North Dakota residents working in Montana keep the reciprocity exemption only by filing a new Form MW-4 with their employer each year.
Update MW-4 when your federal W-4 changes
Montana tax starts from federal taxable income, so the same life changes that affect your federal withholding affect your Montana bill.
Recheck withholding in January 2027
Another rate cut and wider bracket arrive in 2027. Review your paycheck after the new tables take effect rather than keeping old extra withholding.
Deduct Achieve Montana contributions
Contributions to Achieve Montana, the state's 529 plan, are deductible on the Montana return up to an annual limit. The benefit shows up when you file.
Common mistakes
Applying a Montana standard deduction on top of the federal one
Montana has no separate standard deduction or personal exemption. It taxes federal taxable income directly, so you get the $16,100 federal deduction once.
Using the old 5.9% top rate
For 2026 the top rate is 5.65%, and the 4.7% bracket runs to $47,500 for single filers. Older calculators and tables overstate the bill.
Expecting Wyoming wages to escape Montana tax
Montana residents owe Montana tax on all wages, including pay from a job in Wyoming or South Dakota where nothing is withheld for the work state.
Moving to or from Montana
Moving to Montana
Moving to Montana from Wyoming or South Dakota adds $2,877 a year in state tax at $75,000, and from North Dakota $2,695. Coming from Idaho the difference is just $10. In exchange, Montana has no sales tax and no city income tax anywhere. Montana taxes you as a part-year resident from your move date, so expect to file a Montana return for that first year.
Leaving Montana
Leaving Montana for Wyoming or South Dakota saves a single $75,000 earner $2,877 a year, and a move to North Dakota saves $2,695. A move to Idaho changes little at that salary. Montana taxes income earned while you lived there, so file a part-year resident return for the year you leave and update your employer's withholding for the new state.