How Montana capital gains tax works
Montana does not have a separate capital gains rate. Gains are taxed as ordinary income, stacking on top of your other earnings.
Because of that stacking, a large gain can push part of your income into a higher bracket, so the rate on the gain depends on your total income for the year.
Montana taxes long-term capital gains at reduced rates of 3.0% or 4.1%.
Short-term vs long-term gains
Federally, assets held longer than a year qualify for lower long-term rates. Most states, including Montana, do not offer a separate long-term rate.
This calculator estimates the MT state tax by adding the gain to your other income and measuring the extra tax — your true marginal cost.
Lowering the bill
Holding assets longer, harvesting losses to offset gains, and spreading sales across tax years can all reduce what you owe.
Remember this shows Montana state tax only; federal capital gains tax applies on top. Verify with the Montana Department of Revenue (mtrevenue.gov).
Frequently asked questions
Does Montana tax capital gains?
Yes — Montana taxes capital gains as ordinary income, so the rate depends on your total income.
What is the capital gains tax rate in Montana?
Gains are taxed at your Montana income tax rate, up to 5.90%, since there is no separate capital gains rate.
Are long-term gains taxed lower in Montana?
Montana taxes long-term capital gains at reduced rates of 3.0% or 4.1%.
Does this include federal capital gains tax?
No. This estimates the MT state tax only. Federal capital gains tax is separate and applies on top.