Montana veteran taxes

Military retired pay in Montana

Partly exempttax year 2025Sources 1, 2, 3

Montana lets a resident military retiree subtract the lesser of 50% of military retirement income or the retiree’s Montana source wages, business income and farming income, so a retiree with no such Montana income gets no exemption (Mont. Code Ann. § 15-30-2120(3)(n), (8); Form WMRE). It is open only to retirees who became residents on or after June 30, 2023, or who were residents before their retirement pay began and stayed residents, and only for 5 consecutive years; it is lost for good if the taxpayer claims it and then becomes a nonresident. Retirees already receiving retired pay as residents before July 1, 2023 can claim it for tax years 2024 through 2028; a resident who retires later can claim it for 5 consecutive years from the year of retirement (the Department’s example: retiring in 2025, last year 2029).

Survivor Benefit Plan annuities

Partly exemptSources 4, 5, 6

Montana lets a resident beneficiary subtract 50% of Survivor Benefit Plan annuities, with no Montana-income requirement; death benefits do not qualify (Mont. Code Ann. § 15-30-2120(3)(n)(ii); Form WMRE Part III). The same residency rules and 5-consecutive-year limit apply as for retired pay.

Property tax relief for disabled veterans

Exemption or creditSources 7, 8, 9

Montana’s Disabled Veteran Assistance Program (MDV) reduces the property tax rate on the primary residence of an honorably discharged veteran currently rated 100% disabled, or paid at the 100% disabled rate, by the U.S. Department of Veterans Affairs for a service-connected disability (Mont. Code Ann. §§ 15-6-301(10), 15-6-311). The reduction is 100%, 80%, 70% or 50% of the normal tax rate depending on income and marital status; for tax year 2027 the 2025 federal adjusted gross income must be $64,551 or less (single), $74,482 or less (married or head of household) or $56,276 or less (unmarried surviving spouse).

• Full (100%) reduction for tax year 2027 up to $49,654 of income (single), $59,584 (married or head of household) or $41,379 (unmarried surviving spouse); the ranges are adjusted for inflation each year.
• The home must be owned (or under a contract to purchase) and lived in as the primary residence at least 7 months of the year; on agricultural or forest land only the home and a one-acre homesite qualify.
• Application to the Department of Revenue (online or the MDV form to the local field office) by April 15; income and occupancy requirements apply every year.

Vehicle registration for disabled veterans

Fee waiver or discountSources 10, 11

Montana exempts a veteran currently rated 100% disabled, or paid at the 100% disabled rate, by the U.S. Department of Veterans Affairs for a service-connected disability from all motor vehicle registration fees imposed by Title 61, chapter 3 and from the veterans’ cemetery fee, for two noncommercial vehicles and two sets of special veteran plates (Mont. Code Ann. § 61-3-460). A veteran who was a prisoner of war, and a veteran rated 50% or more who was awarded the Purple Heart, get the same registration fee waiver; the Purple Heart veteran pays the veterans’ cemetery fee.

• Plate: special plates with the letters “DV” for veterans rated 100% (or paid at the 100% rate) or Purple Heart recipients rated 50% or more; DV plates cannot be transferred to a surviving spouse.
• An unremarried surviving spouse of such a veteran, of a prisoner of war, or of a service member killed on active duty or who died of a service-connected cause keeps the fee waiver.
• The VA letter (and DD-214 for the Purple Heart) is presented to the county treasurer’s office.