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New Montana property tax rules could shift burden to non-primary properties, county officials say
Summary
County officials described guidance from the Montana Department of Revenue showing primary residences could be taxed at a lower rate (0.76%) while additional homes could face a higher rate (about 1.34%), with uncertainty over enforcement and tier thresholds that could not be resolved at the meeting.
Aaron Renton, identified at the meeting as the newly elected treasurer of the county treasurers association, told Prairie County commissioners that recent guidance from the Montana Department of Revenue could sharply change how residential properties are taxed.
Renton summarized that the DOR guidance would treat a household’s primary residence at a lower taxable rate (0.76 percent), while additional houses owned by the same person would be assessed at a higher rate (around 1.34 percent). He said occupancy rules could qualify a second house for a lower "long-term rental" rate if it is occupied an average of seven months with 28-day stays, even if those months are not continuous. "So that's why I went down to 0.76," Renton said, explaining the DOR's stated intent to reduce tax on primary occupants while shifting tax burdens elsewhere.
County officials and attendees flagged several areas of uncertainty. Renton and others noted that properties owned by LLCs, corporations or irrevocable trusts generally do not qualify for the primary-residence rate, meaning those assets will be taxed at the higher rate. Commissioners also discussed the DOR’s tiered structure described at the meeting: the first tier up to roughly $400,000 would be taxed at the lower rate, a middle tier (roughly $400,000 to $1.1 million) at about 1.19 percent, and higher-valued bands above that; the exact tier breakpoints and full calculations for 2026–2028 remained uncertain.
Speakers warned the change would shift taxable burden toward commercial, industrial and utility classes and could cause notable protest activity. "If they start seeing increase in protest taxes on that, then they have to start firing people because they can't afford it," one commissioner said, describing how disputed assessments could erode county revenues. County staff said the DOR has not yet provided clear tools for local offices to calculate individual taxpayers' new bills and that many counties face an interim period of three years of uncertainty before the full effects filter through local budgets.
Commissioners urged residents to expect significant local impacts in some counties and to prepare for questions at the county treasurer's counter. The meeting closed the discussion with managers and treasurers agreeing to seek more detailed guidance from the DOR and to try to provide local information to answer constituent inquiries.
