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Bill would shield volunteer nonprofit directors from short‑term employment tax liability
Summary
HB 665 would exempt volunteer officers and directors of small nonprofits from personal liability for brief failures to remit employment trust taxes, while preserving exceptions for willful misconduct and larger entities; nonprofit advocates supported the change and the Department of Revenue explained current collection authority.
Representative Bill Mercer presented House Bill 665 as a narrow fix to encourage volunteer nonprofit governance by protecting volunteer directors from short‑term personal liability for employment trust tax delinquencies. Proponents, including the Montana Nonprofit Association, told the committee the measure balances accountability with the need to recruit and retain volunteer board members for small community organizations.
Department of Revenue officials explained existing collections authority and how officer liability is currently interpreted under trust‑tax provisions; questions from senators focused on whether the bill creates new liability or merely clarifies existing practice. The sponsor said the bill is intended to be additive: it provides a carve‑out for small nonprofits and a time limit on the immunity so that persistent noncompliance is not immunized.
The hearing closed with technical questions about statutory interplay between Title 15 (revenue) and Title 27 (civil liability) and requests for reference materials from the Department of Revenue.
