Bill > SB544

This bill provides a transition adjustment for net operating losses (NOLs) related to changes in Montana tax law from 2021. Specifically, taxpayers can elect to make an adjustment to their Montana taxable income if their federal and state NOL carryovers differed as of December 31, 2023. Taxpayers can make this election on their 2024 tax return, filed by October 15, 2025, using a special form from the Department of Revenue. The adjustment allows positive or negative modifications based on the difference between federal and state NOL carryovers, which can be applied to reduce taxable income for 2024 and up to six subsequent years. If a taxpayer does not make the election by the deadline, they lose the opportunity to make the adjustment. The bill applies retroactively to income tax years beginning after December 31, 2023, and becomes effective immediately upon passage. The key purpose is to provide flexibility for taxpayers dealing with discrepancies in NOL treatment resulting from previous tax legislation, allowing them to align their federal and state tax calculations more accurately.

Budget and Finance

https://bills.legmt.gov/#/laws/bill/2/LC1041