What Montana’s New Property Tax Relief Laws Mean for You

BUTTE, MT - Montana’s property tax system is getting a major overhaul—something that could mean more money in your pocket if you own your home, or a shift in the economic landscape if you rent or run a business.

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On May 19, 2025, Governor Greg Gianforte signed into law two bills—House Bill 231 and Senate Bill 542—that aim to provide long-term property tax relief while rebalancing who pays what across the state.

Let's get right into it.

What’s Changing?

The cornerstone of this reform is the introduction of a new “homestead” property tax rate starting in 2026.

This rate will lower taxes on:

• Primary residences

• Long-term rental properties

• Smaller commercial properties

In contrast, second homes and properties valued at more than four times the statewide median will face higher rates.

For 2025, an interim system will be used. Rates will still be adjusted—homes under $2 million in value will generally see lower taxes, while high-value homes will see slightly higher rates.

Additionally, the state is offering a one-time rebate of up to $400 for homeowners, provided the property is their primary residence.

How to Claim Your Rebate

If you’re a homeowner, you’ll need to apply to receive the 2025 rebate, even if you received rebates in 2023 or 2024.

The Montana Department of Revenue will begin sending out eligibility postcards in June, and an online portal will open from August 15 to October 1, 2025.

The good news? If you apply for and receive this rebate, you’ll be automatically enrolled for the 2026 homestead tax rate—unless your home is sold or becomes a secondary property.

What If You Rent?

Even if you don’t own property, these changes may affect you.

The lower tax rates for long-term rental properties could give landlords more breathing room on rising costs, which may (though not guaranteed) ease pressure on rent prices over time.

On the flip side, the increased tax burden on high-value or non-primary residences may affect the availability or cost of short-term rentals and luxury housing.

Business Implications

While the goal is tax relief for homeowners, business groups like the Montana Chamber of Commerce have voiced concern.

They argue the changes merely redistribute the tax burden instead of reducing it overall. Some large industries—like utilities, mining, and timber—could see higher rates as a result.

The Chamber warns that without a broader overhaul of the tax structure, the issue may return in 2027.

However, supporters of the bills point out that large industrial companies have actually paid less in property taxes in recent years, as soaring residential values forced homeowners to shoulder a growing share of the tax burden.

What Comes Next?

Homeowners should prepare to apply for the rebate this summer, and keep an eye out for enrollment information for the new homestead rate starting in December.

Meanwhile, renters and business owners should stay informed, as the impact of these changes could ripple outward through housing costs, utility prices, and future tax debates.

Whether you own property or not, this is a shift in Montana’s tax system that will likely affect all corners of the state—now and in years to come.