The state of Montana currently features a total of 25 census tracts designated as Qualified Opportunity Zones. The census tracts are all located in different cities and are determined by income amounts. The state governor and CEO of U.S. Territories have to grant approval to these tracts in order to designate them as opportunity zones. Investors will be entitled to capital gains tax incentives when investing in an opportunity zone.

Montana had more low-income communities that were eligible for opportunity zone status, although the number was limited to 25. The other areas have been subject to assistance from the Montana Department of Commerce.  However, those census tracts that have qualified as opportunity zones have the potential to emerge from their economic duress. The goal is to develop those areas economically leading to the following results in Montana:

  • Affordable housing
  • Workforce development
  • Downtown revitalization
  • Business expansion and startup

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Montana Tax Situation

The state income tax in Montana tops out at 6.9 percent as there are different brackets, according to income amounts. There is a total of seven tax brackets. One of the benefits of living in Montana is that there is no sales tax and that includes both the state and local levels. There are only four states without sales tax and Montana is among that small contingent. There is also no inheritance tax in Montana as that was repealed in 2000.

Montana currently ranks 20thin the nation in property taxes. The annual property taxes on median-priced homes in the state is $1,698. Income is not as high in Montana as in other states as the top one percent of income among Montana residents is among the lowest of any state.

Montana has received accolades for being one of the fairest states in the country in terms of taxes. The state has become less dependent on income tax, more so than half the states as well as its neighboring states. The state relies quite a bit on corporate taxes while there are also taxes levied on gasoline and tobacco. Funds collected from those two areas of taxation equate to almost a fifth of the state’s income.

MT Industries with Tax Breaks

There are a number of different industries that are eligible for tax breaks in the state of Montana. The state government features numerous incentive programs while local governments have a variety of options as well. Here is a look at some of the top industries that benefit from Montana tax breaks.

    • Lumber

      The timber industry is very important to the economy in Montana and that has led to a variety of tax cuts and incentives in the industry.

    • Mining

      The mining industry continues to be an integral component of Montana’s economy.

    • Construction

      Some of the biggest tax breaks are in the reduction of costs involved in the purchasing of heavy machinery and equipment.

    • Manufacturing

      The tax incentives for Montana manufacturing companies have been able to significantly increase employment numbers across the state.

    There are several tax incentives and programs that work to keep commerce in the state of Montana. These can be used by a variety of industries and there are also many tax breaks for smaller businesses in the state of Montana. There has been little resistance to impeding the growth of tax incentives throughout in-state industries.

    Montana State Financial Facts

    The cost of living is not particularly high in Montana, although the average annual income is below the national average. The lack of a sales tax helps residents, but Montana is not a state with a sizeable affluent population. Here is a look at some of Montana’s key financial facts:

    • Median household income – $50,027
    • Median household savings
      • $0 in savings: 37%
      • $1,000 or less in savings: 54%
    • Total household investments

                68 percent of families that own their home
                Median value of Montana home – $217,200
                32.8 percent of population earns between $10K and $30K annually

    Current economic condition of Montana

    The Montana GDP is among the lowest in the country as it checks in at a little over $45k. However, job growth is positive as it has sustained almost a 2 percent increase over the last couple of years. Close to two-thirds of the state’s land is dedicated to the agricultural sector. Funding for smaller businesses is better than average among lower-populated states and that has led to an increase in entrepreneurship in Montana.

    Montana does not rank highly among states in regard to the economy. It ranks No.45 in quality of life compared to other states, according to Forbes. The unemployment rate across the state stands at 4.2 percent while new businesses are on the rise. The state has become very involved in facilitating the introduction of new businesses. The Department of Labor has also established initiatives to address the shortage of workers in certain areas of the state.

    The economy in Montana is comprised of a diverse group of industries. Health care has become the dominant industry and its gross has also made up for downturns in the agriculture and mining sectors. Projections remain favorable for future growth and the rise in job wages ranks in the top five among all states.

    Primary Industries in Montana

    A plethora of industries makes up Montana’s economy and quite a few contribute similar amounts to the overall personal income earned throughout the state. The economy has made some strides after evening out for a number of years. Montana does not have an exceedingly large population for considering its size. Here is a look at some of the industries that are integral to the Montana economy:

    • Health Care
    • Construction
    • Agriculture
    • Mining
    • Manufacturing

    Top Economic Cities in Montana

    Montana is experienced annual job growth and that has also translated into higher payroll for its workers. Some areas are impacted by the rise or fall of the primary industry, as evidenced by manufacturing upturns in the city of Helena. Here is a look at the cities with the top-performing economies in Montana:

    • Bozeman
    • Missoula
    • Kalispell
    • Helena

    Opportunity Zones in Montana

    Despite the positive economic surge in Montana, there are still some areas that have continued to experience economic turmoil. For example, the city of Libby has the second-worst unemployment rate in the state at 11.2 percent and its average property value is just $95,200. The townspeople have traditionally relied on logging and mining, but the closing of some local companies have impacted this area. Meanwhile, the town of Shelby has been impacted by a high crime rate and the average household income is one of the lowest in the state. These cities are a prime example of where Opportunity Zones are most needed in Montana as this program has the capability of alleviating some of that economic distress. Here is a look at the Qualified Opportunity Zones in Montana:

    • Billings
    • Bozeman
    • Butte
    • Great Falls
    • Helena
    • Kalispell
    • Missoula
    • Blackfeet Indian Reservation
    • Crow Indian Reservation
    • Flathead Indian Reservation
    • Fort Belknap Indian Reservation
    • Fort Peck Indian Reservation
    • Northern Cheyenne Indian Reservation
    • Rocky Boy’s Indian Reservation
    • Red Lodge
    • Lewistown
    • Libby
    • Shelby
    • Thompson Falls
    • Meagher County/White Sulphur Springs
    • Wheatland County
    • Miles City
    • Anaconda
    • Hamilton
    • Mineral County