Montana Tax Extension: Everything You Need to Know

If you need extra time to file your Montana state income taxes, you’re in luck.

Montana offers an automatic six-month extension for individual income tax returns.

However, it’s important to remember that this extension is for filing only—it does not extend the deadline to pay taxes owed.

This guide provides an overview of the Montana tax extension process, including deadlines, penalties, and step-by-step instructions to ensure compliance.

Why File a Montana Tax Extension?

Filing a tax extension allows you extra time to prepare an accurate return. This is especially useful if:

• You are waiting on critical tax documents.
• Your tax situation is complex and requires additional attention.
• You’ve already filed a federal tax extension and want to align your deadlines.

It’s important to understand that although the extension provides additional filing time, any taxes owed must still be paid by the original deadline to avoid penalties and interest.

How to File a Montana Tax Extension

Step-by-Step Guide

Filing a Montana tax extension is straightforward, whether you need an individual or state business tax extension.

• Determine Your Payment Amount:

• • Calculate your estimated tax liability for 2025.
  • Ensure that at least 90% of the liability is paid by April 15th, 2026.

• Submit Form IT Payment Voucher:

• • Complete and submit the Montana Individual Income Tax Payment Voucher (Form IT) by the original due date, even if you are not filing your return yet.
  • Use the correct payment type box (e.g., extension payment) to ensure accurate details.

• Choose Your Payment Method:

• • Online: Use the TransAction Portal (TAP) to pay electronically via e-check (free) or credit/debit card (small fee).
  • By Mail: Mail the completed Form IT along with your payment to the Montana Department of Revenue, P.O. Box 6309, Helena, MT 59604-6309.

• File Your Return by October 15th:

• • Ensure all required forms and documentation are submitted by the extended deadline to avoid additional penalties.

Late Filing and Payment Penalties

Montana imposes penalties for late filing and late payments. These penalties apply when you file an individual or state business tax extension. Here’s what you need to know:

Late Filing Penalty

• If you file your Montana income tax return after October 15th, a late filing penalty will be assessed. The penalty is calculated at 5% of the unpaid tax per month (or part of a month), up to a maximum of 25% of the unpaid tax.
• A minimum penalty of $50 applies, even if you're due a refund. This penalty is based on the amount of tax owed after accounting for payments made through withholding, estimated payments, or credits.
• This penalty only applies to any tax you still owe after subtracting payments made through withholding, estimated tax payments, or credits. It is based on how late your return is after the original or extended deadline.

Late Payment Penalty

• If you do not pay the full amount of tax owed by April 15th, 2026, a late payment penalty will be assessed.
• The penalty accrues at 0.5% of the unpaid tax per month (or part of a month), up to a maximum of 12% of the unpaid tax.
• This penalty is calculated daily from the original due date, regardless of any filing extension.

Interest on Unpaid Taxes

• Interest accrues daily on any unpaid tax from the original due date, April 15th, until the tax is paid in full. The interest rate is determined annually by the Montana Department of Revenue and is based on the federal underpayment rate.
• For the current interest rate, please visit the Montana Department of Revenue's official website.

Revenue Insights: Where Do Your Taxes Go?

Montana Revenue Distribution (2024 Fiscal Year)

In FY 2024, Montana's general fund revenue totaled $3.6 billion, with 61.7% coming from individual income tax, 12.9% from property tax, and 8.6% from corporate income tax. Additional sources include natural resource taxes (4.8%) and cannabis/liquor taxes (3.3%).

Tax levies were primarily allocated to local schools (30.9%), county spending (27.0%), and statewide general services (20.5%), reflecting Montana's focus on education, local governance, and essential services.

This breakdown ensures transparency in how taxpayer contributions support Montana's priorities.

Montana Department of Revenue Full Biennial Report for FY 2024.

Frequently Asked Questions

What Is Montana Tax Liability?

Montana tax liability refers to the total amount of tax you owe to the state after accounting for any payments, deductions, or credits. This figure is essential when calculating your extension payment to avoid penalties.

Do I Need to File a Form for Montana’s Automatic Extension?

No. Montana provides an automatic six-month extension for individual tax returns. However, you must pay any taxes owed by April 15th to avoid penalties.

Can I Pay My Taxes Electronically?

Yes. Use Montana’s TransAction Portal (TAP) to make electronic payments securely.

What Happens If I Don’t Pay Taxes by April 15th?

If you fail to pay at least 90% of your tax liability by the original deadline, you will incur penalties and interest on the unpaid balance. This applies even if you've received an extension to file.

Are Extensions Available for Disaster-Affected Taxpayers?

Yes. Taxpayers affected by disasters may qualify for special extensions and penalty relief. Contact the Montana Department of Revenue for more details.

How Do I Calculate Interest on Unpaid Taxes?

Interest is calculated using this formula: Daily Interest Rate × Outstanding Balance × Days Late = Interest.

For example, for a $300 balance that’s 133 days late: 0.021918% × $300 × 133 = $8.75

Need Help Filing Your Montana Tax Extension?

We simplify the process so you can file with confidence. Get expert support for your Montana and IRS tax extension requirements. Start your tax extension today.