Montana Taxable Income Calculation

Taxpayers will use their federal taxable income (not including the federal qualified business deduction) as the base for calculating their Montana taxable income. Montana’s current system uses the federal adjusted gross income as the base for determining Montana taxable income. With this change, items of income and deduction will no longer need to be recalculated for purposes of determining Montana taxable income. Taxable Social Security Income and net operating losses are included in Montana taxable income to the extent that they are included in federal taxable income.