Bill > SB99

This bill modifies Montana's tax code to expand the definition of unrelated business income for tax-exempt organizations, specifically targeting rental and accommodation income. The legislation makes two key changes: first, rental income from leasing agricultural property will now be considered unrelated business income and subject to taxation, and second, income derived from providing accommodations (such as lodging) will also be classified as taxable unrelated business income. Currently, tax-exempt organizations are generally exempt from income tax, but if they earn unrelated business income over $100, they must pay taxes on that income. The bill adds specific provisions to ensure that rental income from agricultural properties and accommodation services are now included in this taxable category, effectively closing potential tax loopholes. These changes will apply to income tax years beginning after December 31, 2025, giving organizations time to prepare for the new tax treatment. The goal appears to be ensuring that tax-exempt organizations do not gain unfair financial advantages through certain types of income-generating activities that are not directly related to their primary exempt purposes.

Budget and Finance, Government Affairs

https://bills.legmt.gov/#/laws/bill/2/LC0963