Most likely what the state's estimate was won't be what is on your actual tax bill. However, what we are experiencing in Montana is residential home values are rising faster than other property types so the tax burden is falling more on homeowners because they have a larger tax base.Īs we mentioned above, there is a reappraisal cycle every two years and 2023 saw a dramatic jump from 2021, but we don't yet know what that will mean for upcoming property taxes. For example, if values rise for all property types, taxes will remain the same because it isn't your property value that you are taxed on but the proportion of the tax base your property represents. Lawmakers can reduce how much of the valuation is taxable but if they do that for one property class, it would be raised on a different property class or they would have to reduce services. For residential, commercial, industrial, and agricultural property classes there is a two-year appraisal cycle.ĭO RISING PROPERTY VALUES MEAN YOU HAVE TO PAY HIGHER PROPERTY TAXES? The Montana constitution and state law require the Montana Department of Revenue to reappraise all property classes periodically and value similar property across the state. It includes a local portion which is used to fund services in the area and a state portion that is used for public schools. A mill is the tax rate per thousand dollars of the taxable value of a property.

The county government collects the taxes from property owners and is responsible for distributing them. This leads us to the next point.ģ) Local taxing jurisdictions (cities and counties) apply mill levies to the property's taxable value to calculate taxes owed.

To keep revenue levels stable they have to raise mill levies on all property owners. Since 2018 the tax rate for residential has been 1.35% and for commercial is 1.89%. If they cut the tax rate for any property classes, the total taxable value in the local jurisdiction goes down, as does the amount of revenue for that jurisdiction.

The Montana Department of Revenue determines the market value of the properties. They look at what similar properties have currently sold for to calculate the current market value.Ģ) The Montana Legislature assigns a tax rate to each class of property and multiplies that rate by the property's market value, which gives you the taxable value. We'll break it down for you.ġ) The Montana Legislature creates the different classes of property such as residential, commercial, agricultural land, business equipment, etc. How property taxes are calculated can be complicated so it's not always easy to understand what you are paying for and how it relates to your home's property value.

Montana income tax brackets 2021