Montana paycheck taxes at a glance
| Income tax on wages | Progressive, 4.7% – 5.65% |
|---|---|
| Standard deduction | $16,100 single · $32,200 married filing jointly |
| Minimum wage (2026) | $10.85 an hour ($4.00 at businesses not covered by federal law with annual sales of $110,000 or less; no tip credit) |
2026 Montana income tax brackets (single filers)
| Taxable income | Rate |
|---|---|
| $0 – $47,499 | 4.7% |
| $47,500 and up | 5.65% |
Example: a $77,100 salary in Montana
The median household income in Montana is about $77,099 (2025 data). Here's what one earner with that salary, paid every two weeks, filing single with no pre-tax deductions, would see on each paycheck in 2026:
| Gross pay | $2,965.38 |
|---|---|
| Federal income tax | −$312.77 |
| Social Security | −$183.85 |
| Medicare | −$43.00 |
| Montana income tax | −$115.20 |
| Take-home pay | $2,310.56 |
That's $60,075 a year in take-home pay, or 22.1% of gross pay going to taxes.
Take-home pay by salary in Montana
Single filer, paid biweekly, standard W-4, no pre-tax deductions:
| Salary | Per paycheck | Per year | State taxes | Total tax rate |
|---|---|---|---|---|
| $40,000 | $1,276.80 | $33,197 | $1,123 | 17% |
| $60,000 | $1,858.72 | $48,327 | $2,063 | 19.5% |
| $80,000 | $2,382.73 | $61,951 | $3,159 | 22.6% |
| $100,000 | $2,880.42 | $74,891 | $4,289 | 25.1% |
| $150,000 | $4,102.96 | $106,677 | $7,114 | 28.9% |
| $200,000 | $5,345.69 | $138,988 | $9,939 | 30.5% |
What changed for 2026
- House Bill 337 (2025) cut the top rate from 5.9% to 5.65% and widened the 4.7% bracket. For single filers, 4.7% now covers the first $47,500 of taxable income, up from $21,100 in 2025. For married couples filing jointly it covers $95,000, up from $42,200.
- The Montana earned income tax credit rose to 20% of the federal credit.
- The minimum wage is $10.85 an hour in 2026 and is set to rise to $11.20 on January 1, 2027.
Montana pay rules worth knowing
- If your employer hasn't set a regular pay period, Montana law presumes you're paid semimonthly.
- If you're laid off or discharged, your final wages are due immediately, unless a written personnel policy in place beforehand allows more time. Even then, they're due by the next regular payday or within 15 days, whichever comes first.
- If you quit, your final wages are due by the next regular payday for that pay period or within 15 days, whichever comes first.
Montana starts with your federal return
Montana defines its taxable income as your federal taxable income, with a short list of state additions and subtractions. That has a few practical effects:
- Your federal deduction is your Montana deduction. Whatever standard or itemized deduction you take on your federal return also reduces your Montana taxable income.
- Federal changes flow through. New federal deductions, such as those for qualified tips and overtime, lower Montana taxable income too.
- Seniors get one extra break. Taxpayers 65 and older subtract an additional $5,660 for 2025, an amount indexed each year.
After that, only two rates apply to ordinary income: 4.7% and 5.65% for 2026. Long-term capital gains get their own lower rates of 3.0% and 4.1%.
What the 2026 tax cut is worth
House Bill 337 made two changes at once: the 4.7% bracket now reaches much higher, and the rate above it is lower. Compare the same $60,000 of Montana taxable income for a single filer:
- 2025 rates: $3,287
- 2026 rates: $2,939
That’s about $348 less. The wider bracket also means many single workers no longer reach the top rate at all. On $60,000 of wages, the $16,100 federal standard deduction leaves $43,900 of taxable income, all of it taxed at 4.7%.
The same law takes another step in 2027, widening the single bracket to $65,000 and lowering the top rate to 5.4%. The Department of Revenue said it would update withholding tables and formulas to match the new rates.
Minimum wage with no tip credit
Montana’s $10.85 minimum wage is indexed to inflation. Each year the Department of Labor & Industry compares the Consumer Price Index from August to August and announces the new rate by September 30, rounded to the nearest five cents. The 2027 rate is $11.20.
Montana has no tip credit, so servers and bartenders earn at least the full minimum wage before tips. The $4.00 rate applies only to businesses outside federal wage law with annual sales of $110,000 or less, and even there, any employee who handles interstate goods must get the higher of the state or federal minimum.
Working across state lines
Montana has an income tax reciprocity agreement with North Dakota. A North Dakota resident working in Montana files Form MW-4 to stop Montana withholding, and a Montana resident working in North Dakota pays Montana tax on those wages instead of North Dakota’s.
Use the salary calculator to convert an hourly rate to annual pay, and the income tax calculator to estimate the federal taxable income Montana starts from.
Estimates only. Your employer’s payroll system, your W-4 and MW-4 determine your actual paycheck.
Sources
- Montana Department of Labor & Industry: Montana's Minimum Wage
- Montana Department of Labor & Industry: Wage Payment Act
- U.S. Department of Labor: State Payday Requirements
- Montana Department of Revenue: 2025 income tax rates
- Montana Department of Revenue: 2025 Form 2 instructions
- Montana Code Annotated 15-30-2101: Definitions (Montana taxable income)
- Census Bureau: Household Income in States and Metropolitan Areas, 2025
- revenue.mt.gov
- IRS Publication 15-T (federal withholding)
Frequently asked questions
What are Montana's income tax rates for 2026?
There are two. Taxable income up to $47,500 for single filers, $71,250 for heads of household or $95,000 for married couples filing jointly is taxed at 4.7%, and income above that at 5.65%. Net long-term capital gains are taxed separately at 3.0% or 4.1%.
Do the new federal deductions for tips and overtime lower my Montana tax?
They do. Montana's instructions for 2025 returns say the federal Schedule 1-A deductions for qualified tips, qualified overtime, car loan interest and the enhanced senior deduction are included in figuring Montana taxable income. That follows from Montana starting with your federal taxable income.
I live in North Dakota and work in Montana. Do I pay Montana income tax?
Not on your wages. Montana and North Dakota have a reciprocity agreement, so each state's residents are exempt from wage withholding and income tax on pay earned in the other. Claim the North Dakota reciprocity exemption on Montana Form MW-4 so your employer stops withholding Montana tax.
Can a Montana employer pay tipped workers less than minimum wage?
No. Montana doesn't allow a tip credit, so tipped employees must be paid the full $10.85 an hour before tips. Employers also can't use meal credits or a training wage to get below the minimum.
Are more Montana tax cuts already scheduled?
Yes. For 2027, House Bill 337 widens the 4.7% bracket to $65,000 for single filers ($130,000 for married couples filing jointly) and lowers the top rate to 5.4%.
Facts verified November 6, 2026. Estimates only; your employer's payroll system and your W-4 determine your actual withholding.