Bill > HB220

This bill establishes a new child tax credit for Montana resident taxpayers with children 5 years of age or younger. The credit provides $1,200 per qualifying child, but begins to phase out for taxpayers with a federal adjusted gross income (AGI) over $50,000, reducing by $90 for every $1,000 of income above that threshold. The credit is fully refundable, meaning taxpayers can receive the full amount even if it exceeds their tax liability, and the income threshold for claiming the credit is $56,000 regardless of filing status. To qualify, taxpayers must be eligible for the federal child tax credit under section 24 of the Internal Revenue Code. The bill also adds the child tax credit to the list of tax credits that will be periodically reviewed by the revenue interim committee to assess its effectiveness and impact. The new tax credit will apply to income tax years beginning after December 31, 2025, giving taxpayers and the state time to prepare for its implementation. By targeting families with young children and providing a substantial financial benefit, the bill aims to support families with young children in Montana.

Budget and Finance

https://bills.legmt.gov/#/laws/bill/2/LC2036