What is the property tax rate in Montana?
The property tax rate in Montana averages 0.61% of market value for owner-occupied homes (Tax Foundation 2026, using the 2024 American Community Survey). That is below the national middle and well under states such as Illinois or New Jersey.
Montana bills are built in three steps. The Department of Revenue sets a market value. A class tax rate turns that into taxable value. Local levies, stated in mills, are then applied to taxable value. One mill is $1 of tax per $1,000 of taxable value, and the Department’s biennial report puts the statewide average levy at 498.87 mills for tax year 2024.
Montana property tax rates by class for 2026
Senate Bill 542 and House Bill 231, passed in 2025, rewrote the residential class rates starting with tax year 2026. The Department of Revenue lists these rates for 2026, applied to market value:
- Section 15-6-134 of the Montana Code lists rental multifamily dwelling units within class four residential property and sets the 1.1% rate for those that qualify for the rental reduced rate.
- The commercial thresholds are six times the Department’s estimated median commercial value of $379,000.
- A building with both apartments and storefronts is split: the land takes the use with the highest share of value, and improvements are apportioned by use.
| Property | 2026 class rate |
|---|---|
| Multifamily dwellings used as long-term rentals | 1.10% flat |
| Primary residences and qualifying long-term rentals, first $378,000 | 0.76% |
| Same, $378,001 to $756,000 | 0.90% |
| Same, $756,001 to $1,511,999 | 1.10% |
| Same, $1,512,000 and above | 1.90% |
| Second homes, short-term rentals and other residential | 1.90% |
| Commercial and industrial, under $2,274,000 | 1.50% |
| Commercial and industrial, $2,274,000 and above | 1.90% |
The long-term rental rate for Montana apartments
An apartment unit qualifies for the lower rate if it is rented for at least 28 days at a time, for at least seven months of the year, to tenants who live there as a residence, and the owner is current on property taxes. LLCs, corporations and irrevocable trusts can qualify. Months a unit sits listed but empty do not count toward the seven.
It is not automatic. The owner enrolls each qualifying unit with the Department of Revenue and must attach the prior year’s monthly rent and income and expense figures; the Department’s FAQ says applications without them are denied. The deadline for tax year 2026 was March 1, 2026, and the window for 2027 runs from May 4, 2026 to March 1, 2027.
A unit that does not qualify, or is never enrolled, stays at the 1.9% default rate. A false application can cost three times the extra tax, plus interest.
How Montana sets market value
The Department of Revenue, not the county, values property in Montana, and it reappraises on a two-year cycle. For the 2025-2026 cycle, every property is valued as of a single date, January 1, 2024, according to the Department’s Form AB-26. Your value for 2026 is therefore the same date-of-value figure used for 2025, unless the property changed.
There is no cap on how much market value can rise from one cycle to the next. What limits growth in tax bills is the levy side: section 15-10-420 restricts how much cities, counties and special districts can raise their levies, while school levies follow their own rules.
Does a sale trigger reassessment in Montana?
No. Montana does not revalue a property because it sold; values change only with the reappraisal cycle or a physical change to the property. The buyer inherits the same market value the seller had for the rest of the cycle.
The class rate is another matter. The Department’s rental FAQ says the long-term rental classification can be lost when you sell or transfer ownership. The owner must notify the Department within 30 days, and the property moves to the standard rate starting the next calendar year unless it qualifies again. A buyer who plans to keep the units as long-term rentals needs to enroll before the next March 1 deadline, or the bill can jump from a 1.1% to a 1.9% class rate.
Montana property tax by county
Average levies in Montana run from about 214 mills in Madison County to about 898 mills in Big Horn County for tax year 2024. The Department of Revenue does not publish one total levy per county, so we derived these averages from its Table 6.13 (Property Tax Summary by County, TY 2024): total taxes excluding special improvement district charges and fees, divided by the taxable value implied by the state levy. The same method gives about 495 mills statewide, close to the Department’s 498.87.
The last column applies the 2026 multifamily long-term rental rate of 1.1% to show tax per $1 million of market value. Levies were set in 2024 under the old class rates and will move as taxable values change, so use your own tax district’s current levy for underwriting.
- Other large counties on the same basis: Cascade about 611 mills, Lewis and Clark about 603, Yellowstone about 587, Flathead about 446 and Gallatin about 444.
- Every county carries the state levies: 95 mills for schools (33 elementary, 22 high school, 40 state equalization), 6 mills for the university system and, in five larger counties, 1.5 mills for vocational-technical education.
| County | Average levy, TY 2024 (mills) | Tax per $1M at 1.1% class rate | Group |
|---|---|---|---|
| Big Horn | 898 | $9,878 | Highest |
| Sheridan | 824 | $9,064 | Highest |
| Dawson | 772 | $8,492 | Highest |
| Daniels | 767 | $8,437 | Highest |
| Missoula | 742 | $8,162 | Highest |
| Park | 382 | $4,202 | Lowest |
| Wibaux | 332 | $3,652 | Lowest |
| Fallon | 299 | $3,289 | Lowest |
| Carter | 221 | $2,431 | Lowest |
| Madison | 214 | $2,354 | Lowest |
How to appeal your Montana property value
You have 30 days from the date on your classification and appraisal notice to ask the Department of Revenue for an informal review on Form AB-26. You can file one AB-26 per valuation cycle, so a review you request in 2025 uses up your informal review for the 2025-2026 values.
If the Department’s answer does not satisfy you, you have 30 days from the date on its determination letter to appeal to your county tax appeal board. An appeal can contest the value or the classification, which now matters a great deal for rentals given the gap between the 1.1% and 1.9% rates.
- Within 30 days of the notice date: file Form AB-26 with the field office listed on the notice.
- Within 30 days of the Department’s determination letter: appeal to the county tax appeal board.
- Bring rent rolls, income and expense statements and any recent sales, since apartment values usually rest on income.
Worked example: property tax on a $2M Montana apartment building
Take a 20-unit building in Billings with a market value of $2,000,000, every unit leased by the year. Enrolled at the 1.1% long-term rental rate, its taxable value is $22,000. At the statewide average of 498.87 mills, the yearly tax is about $10,975, or 0.55% of market value. If the units were not enrolled, the 1.9% default rate would give a taxable value of $38,000 and a tax of about $18,957.
Location moves the bill too. At Missoula’s average of about 742 mills, the enrolled building would owe about $16,324, and at Madison’s 214 mills about $4,708.
Now the sale. The buyer keeps the $2,000,000 market value through the end of the 2025-2026 cycle. If the buyer fails to re-enroll after the sale, the property moves to 1.9% the next year and the bill rises by about $7,982 at the statewide average levy. At an illustrative 6% cap rate, that loss of net operating income would take roughly $133,000 off what a buyer could pay. Enrolled on time, the buyer’s NOI takes no hit from the sale.
| Scenario | Taxable value | Yearly tax |
|---|---|---|
| Long-term rental rate 1.1%, 498.87 mills | $22,000 | $10,975 |
| Default rate 1.9%, 498.87 mills | $38,000 | $18,957 |
| Long-term rental rate, Missoula (742 mills) | $22,000 | $16,324 |
| Long-term rental rate, Madison (214 mills) | $22,000 | $4,708 |
| Extra tax if the buyer loses the 1.1% rate | n/a | $7,982 |
Effective rate or class rate: which number to use
Use the class rate and your own district’s levy for a specific building, and the 0.61% effective rate only to compare Montana with other states. The Tax Foundation figure divides median taxes paid by median home value for owner-occupied homes, and it reflects the 2024 rules, before the 2026 tiers and the multifamily rental rate took effect.
For an enrolled apartment building, multiply market value by 1.1% and then by your levy in mills divided by 1,000. A building in a 500-mill district works out to about 0.55% of market value. The same building left at the 1.9% default rate works out to about 0.95%, which is why enrollment status belongs in every rent roll review and every purchase agreement for a Montana apartment building.
What to gather on property tax before you sell
A buyer will ask for the paper behind your tax line, and Montana’s 2026 changes add a few items.
- The last two tax bills and the current classification and appraisal notice.
- Proof of long-term rental enrollment for each unit, and the rent and expense data you filed with it.
- Any pending AB-26 review or county tax appeal board case.
- Special improvement district charges and fees, which sit outside the mill levy.
- Leases showing terms of 28 days or more, which support the buyer’s own enrollment.
Selling an apartment building in Montana
Skyline buys apartment buildings with five or more units in Montana, including high-levy markets such as Missoula and lower-levy counties across the state. We buy directly, close on your timeline, and can work inside 1031 deadlines. We underwrite from your actual tax bills and the rental rate the building qualifies for.
For the tax on the sale itself, see Montana capital gains tax on real estate. For notice periods, deposits and rent rules a buyer inherits, see Montana landlord-tenant law for apartment owners.
