--- title: "Montana LLC Taxes: What You'll Actually Owe in 2026 | LLC Attorney" description: "How Montana LLC taxes work in 2026: the two-bracket income tax topping out at 5.65%, no general sales tax, no franchise tax, the temporarily fee-free Annual Report, and the S-Corp election." canonical: https://llcattorney.com/states/mt/llc-taxes-montana image: https://llcattorney.com/images/share-cover.png source_path: /states/mt/llc-taxes-montana --- Key Takeaways - Montana taxes LLC pass-through income at Two brackets: 4.7% and 5.65% (top rate) - Montana imposes no separate entity-level franchise tax on standard LLCs - Sales Tax: None — Montana has no general state sales tax - Annual Report due April 15 each year, $0 for on-time filings through April 15, 2027 (normally $20; $35 total with the $15 late fee if filed late) fee - Federal self-employment tax of 15.3% applies to net LLC profit regardless of state - Montana automatically follows the federal S-Corp election, filing Form CLT-4S at the state level with no separate election process and no additional state-level tax beyond ordinary income tax on the owners' share. - Same-day formation and compliance filing available through LLC Attorney at no markup on state fees Montana pairs a genuinely simple tax structure with a rare perk: no general sales tax anywhere in the state, plus an Annual Report that's currently fee-free through 2027. Combined with no franchise tax, that makes Montana one of the lighter-touch states for ongoing LLC compliance costs — for now. This guide covers exactly what a Montana LLC owes in 2026 — state and federal tax obligations, the Annual Report's temporary fee waiver and its 2027 expiration, the narrow lodging and rental-vehicle taxes that apply despite Montana's no-sales-tax status, and when an S-Corp election is worth the added payroll complexity. 5.65%Top state income tax rate 0%General state sales tax $0Annual Report fee (through 2027) 0Mandatory franchise/minimum tax ## Montana Personal Income Tax on LLC Profit By default, a Montana LLC is a pass-through entity — the LLC itself doesn't pay federal or Montana income tax. Profit flows through to the owners' personal returns, taxed once at the federal level and once under Montana's two-bracket system, with most profit above a modest threshold landing in the 5.65% top bracket. **Montana's rate: Two brackets: 4.7% and 5.65% (top rate)** Under HB 337's simplified structure, the 4.7% rate applies to income up to $47,500 (single) / $71,250 (head of household) / $95,000 (married filing jointly), with 5.65% applying above those thresholds. Long-term capital gains are taxed separately at 3.0% and 4.1% rates rather than under the ordinary brackets. This two-bracket system is a recent simplification from a prior seven-bracket structure, and for most LLC owners with meaningful profit, income above the threshold lands in the 5.65% bracket. ## Does Montana Charge an Entity-Level Franchise Tax? Montana has no franchise tax and no minimum LLC fee. A standard pass-through Montana LLC owes no entity-level state tax at all. Montana recognizes the federal S-Corp election automatically — the state S-Corp return (Form CLT-4S) follows the federal election with no separate state-level approval required, and no additional forced tax beyond that. A Pass-Through Entity election is also available as a SALT-cap workaround for owners who itemize federally. ## Montana Sales Tax Montana is one of only five states with no general sales tax (alongside Alaska, Delaware, New Hampshire, and Oregon), so most retail and service LLCs never register to collect sales tax at all. The exceptions are narrow but real: a 7% lodging tax on hotels and campgrounds, a 4% rental vehicle tax, and — in certain designated 'resort communities' — a local resort tax on goods and services sold within those specific town boundaries. If your LLC operates in one of those categories, you do have a collection obligation despite Montana's no-sales-tax reputation. - State rate: **None — Montana has no general state sales tax** - There's no general sales tax return to file, since Montana is one of only five states with no statewide sales tax. ## Montana Annual Report Requirement Montana requires every LLC to file Annual Report with the Montana Secretary of State, due April 15 each year. Filing fee: $0 for on-time filings through April 15, 2027 (normally $20; $35 total with the $15 late fee if filed late). If the Annual Report remains unpaid, the Secretary of State issues a dissolution notice around September 1, with a final cutoff around December 1 for domestic LLCs (November 1 for foreign LLCs) before administrative dissolution takes effect. Reinstatement requires filing all delinquent Annual Reports and paying any accumulated late fees through the Secretary of State before the LLC is restored to good standing. ## Federal Self-Employment Tax and How Your Montana LLC Is Classified Regardless of which state you're in, LLC owners who materially participate in the business owe federal self-employment tax — 15.3% on net profit, covering Social Security (up to the $184,500 (2026) wage base) and Medicare (no cap). ### Single-Member LLCs A single-member Montana LLC defaults to a disregarded entity for federal tax purposes — you report income and expenses on Schedule C of your personal Form 1040 and compute self-employment tax on Schedule SE. ### Multi-Member LLCs A multi-member Montana LLC defaults to partnership taxation, filing Form 1065 and issuing each member a Schedule K-1. Montana has no separate filing consequence tied to member count for either the Annual Report or state income tax. ## Should Your Montana LLC Elect S-Corp Taxation? An S-Corp election lets you split LLC profit into a reasonable salary (payroll-taxed) and distributions (not subject to self-employment tax), once the business is consistently profitable enough to justify the added payroll complexity. **Montana's treatment:** Montana automatically follows the federal S-Corp election, filing Form CLT-4S at the state level with no separate election process and no additional state-level tax beyond ordinary income tax on the owners' share. With no entity-level LLC tax to offset against the savings, Montana's S-Corp math is straightforward — the entire benefit comes from reducing federal self-employment tax, weighed against the 5.65% top state bracket that applies to wages and distributions alike either way. ## Montana LLC Tax Costs at a Glance Tax / Fee Amount Notes Annual Report $0 for on-time filings through April 15, 2027 (normally $20; $35 total with the $15 late fee if filed late) Due April 15 each year; $15 late fee on top of the normal $20 fee ($35 total) if filed after April 15 if missed Sales Tax None — Montana has no general state sales tax State-level rate Federal self-employment tax 15.3% Applies to net profit up to the $184,500 (2026) Social Security wage base (Medicare portion has no cap) State personal income tax (on your share of LLC profit) Two brackets: 4.7% and 5.65% (top rate) This two-bracket system is a recent simplification from a prior seven-bracket structure, and for most LLC owners with meaningful profit, income above the threshold lands in the 5.65% bracket. Montana registered agent (professional service) $49–$300/yr LLC Attorney service available ## How to Handle Your Montana LLC's Taxes ### If You Do It Yourself **Step 1 — Get your federal EIN before anything else.** Apply for your EIN for free directly at irs.gov — a purely federal application with no Montana-specific step. **Step 2 — Confirm your default federal tax classification.** A single-member LLC defaults to a disregarded entity (Schedule C); a multi-member LLC defaults to partnership taxation (Form 1065 plus Schedule K-1 for each member). Neither requires a separate election — this is automatic unless you file Form 8832 or Form 2553 to change it. **Step 3 — Register with the Montana Department of Revenue if required for state income tax withholding or estimated payments.** This two-bracket system is a recent simplification from a prior seven-bracket structure, and for most LLC owners with meaningful profit, income above the threshold lands in the 5.65% bracket. **Step 4 — Register for sales tax if you sell taxable goods or services.** Register with the Montana Department of Revenue at mtrevenue.gov before your first taxable sale. There's no general sales tax return to file, since Montana is one of only five states with no statewide sales tax. **Step 5 — Register for payroll/reemployment tax the moment you hire your first employee.** The moment you hire your first employee, register with the Montana Unemployment Insurance Division. 2026 new-employer rates are industry-based (for example, roughly 1.30% for agriculture, forestry, hunting, and fishing) plus a flat 0.18% Administrative Fund Tax, on a $47,300 taxable wage base. **Step 6 — Set up quarterly estimated tax payments.** If you expect to owe $1,000 or more in combined federal and Montana tax for the year, both the IRS and the Montana Department of Revenue expect quarterly estimated payments covering income tax and federal self-employment tax on your LLC profit. **Step 7 — File your Annual Report every Montana deadline.** Annual Report is due April 15 each year with the Montana Secretary of State, $0 for on-time filings through April 15, 2027 (normally $20; $35 total with the $15 late fee if filed late) fee. Missing it triggers $15 late fee on top of the normal $20 fee ($35 total) if filed after April 15. **Step 8 — Decide whether an S-Corp election makes sense once your LLC is consistently profitable.** With no entity-level LLC tax to offset against the savings, Montana's S-Corp math is straightforward — the entire benefit comes from reducing federal self-employment tax, weighed against the 5.65% top state bracket that applies to wages and distributions alike either way. **Step 9 — Watch for Montana-specific tax traps.** Montana's $0 Annual Report fee is a temporary Secretary of State waiver running through 2027, not a permanent repeal — the normal $20 fee is scheduled to return in 2028 unless extended, so don't assume the filing stays free indefinitely. Separately, Montana's 'no sales tax' reputation is genuinely accurate for most businesses, but LLCs in lodging, rental cars, or designated resort communities still owe narrower special taxes despite the state's no-sales-tax status. **Step 10 — Keep business and personal finances completely separate.** Commingling funds is the single biggest reason courts pierce the LLC liability shield, and it also makes tax preparation far more error-prone. Run all business income and expenses through a dedicated business bank account and keep receipts. Ready to Launch Your Business in Montana?Follow our fast, easy process to get started right now.[Start My Business](https://app.llcattorney.com/formation?intake_type=formation) ### If LLC Attorney Does It for You 1. Submit your information at llcattorney.com — entity classification, expected revenue, and whether you'll be hiring employees or collecting sales tax. 2. LLC Attorney obtains your EIN, registers you with the Montana Department of Revenue and Montana Department of Revenue as needed, and sets up your compliance calendar for Annual Report. 3. Receive reminders before every deadline through your client portal, plus access to flat-fee attorney consultations (no retainer) when an S-Corp election or multi-state question needs a licensed professional's judgment call. ## When Should You Talk to a Tax Professional About Your Montana LLC? Montana's tax picture is relatively simple, but a CPA is worth consulting when deciding whether your profit level justifies an S-Corp election, whether the optional Pass-Through Entity election makes sense for your ownership structure, or if your LLC operates in lodging, rental vehicles, or a resort community and needs to confirm its narrower tax obligations. ## What You Actually Get With LLC Attorney's Montana Compliance Service A temporarily free Annual Report is easy to treat as a non-event — but the April 15 deadline still matters, and the fee waiver is scheduled to expire after 2027. LLC Attorney's Montana service tracks both the current deadline and what's coming next. - EIN obtained for you at no extra charge. - State tax and sales tax registration handled as part of formation, starting at $49. - An ongoing compliance subscription (available through an ongoing compliance subscription — contact LLC Attorney for current pricing) tracks every Montana deadline — Annual Report, and registered agent renewal. - Access to professionally trained Business Success Advisors at no charge, plus flat-fee attorney consultations (no retainer) for S-Corp election analysis and multi-state nexus questions. Montana's tax simplicity won't last forever as scheduled changes take effect — LLC Attorney keeps your Annual Report current today and flags what shifts down the road. ## Get Your Montana LLC's Taxes Set Up Correctly Getting your EIN, tax registrations, and compliance calendar right from day one prevents expensive corrections later. LLC Attorney's Montana formation service starts at $49, and an ongoing compliance subscription (available through an ongoing compliance subscription — contact LLC Attorney for current pricing) keeps you ahead of every deadline after that. See our [full pricing](/pricing) for all service tiers. Ready to Launch Your Business in Montana?Follow our fast, easy process to get started right now.[Start My Montana LLC](https://app.llcattorney.com/formation?intake_type=formation) ## Frequently Asked Questions ### Does my Montana LLC have to pay franchise tax? ![icon](/_next/image?url=%2Fimages%2Ficons%2FfaqPlus.png&w=128&q=75) No. Montana has no franchise tax or minimum tax on LLCs. Your only recurring state-level obligation is the Annual Report, which is currently fee-free through 2027 for on-time filings. ### Do I need to collect sales tax in Montana? ![icon](/_next/image?url=%2Fimages%2Ficons%2FfaqPlus.png&w=128&q=75) Generally no — Montana is one of only five states with no general sales tax, so most LLCs never register to collect it. The exceptions are lodging (7%), rental vehicles (4%), and businesses operating within designated resort communities, which impose their own local tax. ### What is the Montana Annual Report and when is it due? ![icon](/_next/image?url=%2Fimages%2Ficons%2FfaqPlus.png&w=128&q=75) Every Montana LLC files an Annual Report with the Secretary of State, due April 15 each year. The normal $20 fee is currently waived for on-time filings through 2027, though a $15 late fee applies if you file after April 15. ### What happens if I miss a Montana LLC tax or filing deadline? ![icon](/_next/image?url=%2Fimages%2Ficons%2FfaqPlus.png&w=128&q=75) Missing the April 15 deadline adds a $15 late fee to the normal $20 fee (though the base fee itself is waived through 2027 for on-time filers). If the report stays unpaid, the Secretary of State issues a dissolution notice around September 1, with administrative dissolution following around December 1 for domestic LLCs. ### Should my Montana LLC elect S-Corp taxation? ![icon](/_next/image?url=%2Fimages%2Ficons%2FfaqPlus.png&w=128&q=75) It depends on your profit level. Since Montana has no entity-level LLC tax, the S-Corp calculation is a clean federal self-employment-tax play — split profit into reasonable salary and distributions once your profit level justifies the added payroll complexity. ### How is a single-member LLC taxed in Montana? ![icon](/_next/image?url=%2Fimages%2Ficons%2FfaqPlus.png&w=128&q=75) A single-member Montana LLC defaults to a disregarded entity for federal tax purposes — you report income on Schedule C and pay self-employment tax via Schedule SE. Montana adds its two-bracket income tax (topping out at 5.65%) at the personal level. ### I operate in multiple states — which state's taxes apply to my LLC? ![icon](/_next/image?url=%2Fimages%2Ficons%2FfaqPlus.png&w=128&q=75) If your LLC does business in a state other than the one it's formed in — an office, employees, inventory, or significant sales there — you may have created nexus requiring registration and tax obligations in that state too. This is fact-specific and worth a conversation with a tax professional if you operate in multiple states. ### How much will I actually pay in taxes on my Montana LLC? ![icon](/_next/image?url=%2Fimages%2Ficons%2FfaqPlus.png&w=128&q=75) For a typical Montana LLC with in-state owners and no employees: a two-bracket state income tax topping out at 5.65%, no franchise tax, an Annual Report that's currently fee-free through 2027, plus federal income tax and 15.3% federal self-employment tax (up to the $184,500 Social Security wage base for 2026). There's no general sales tax to add, unless you operate in lodging, rental vehicles, or a resort community. ### Does LLC Attorney help with LLC tax compliance? ![icon](/_next/image?url=%2Fimages%2Ficons%2FfaqPlus.png&w=128&q=75) Yes. LLC Attorney's ongoing compliance subscription tracks your Montana filing deadlines, handles your Annual Report, and connects you with flat-fee attorney consultations (no retainer) when a tax question needs a licensed professional's judgment call. ## Learn More About Montana - [Montana LLC Formation](/states/mt/llc-formation-montana) - [Montana Registered Agent](/states/mt/registered-agent-montana)