How does Montana tax capital gains?

Under Montana's 2024 reform, short-term capital gains are taxed as ordinary income (4.7% or 5.9%), while net long-term capital gains receive a preferential lower rate — about 3.0% in the lower bracket and 4.1% in the upper bracket.

What are the federal capital gains rates?

Short-term gains (assets held one year or less) are taxed at ordinary federal income rates. Long-term gains (held more than a year) are taxed at 0%, 15% or 20% depending on your total taxable income and filing status.

What counts as long-term versus short-term?

Hold an asset more than one year before selling and the gain is long-term, qualifying for the lower federal and Montana rates. Sell within a year or less and the gain is short-term, taxed at higher ordinary rates.

Does Montana give a capital gains break?

Yes. Montana applies a reduced rate to net long-term capital gains rather than taxing them fully as ordinary income, which lowers the state tax on qualifying long-term investment profits compared with wages.

Is this calculator exact?

It is a planning estimate. It does not model the 3.8% Net Investment Income Tax, state credits, or interactions with your full return, so confirm with a tax professional for large transactions.

Montana Capital Gains Tax Calculator

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Selling stocks, crypto or property at a profit in Montana triggers capital gains tax at both the federal and state level. How much you owe depends on how long you held the asset: long-term gains (over a year) get favourable rates, while short-term gains are taxed like ordinary income. This calculator combines the federal and Montana pieces.

How it works

The estimate layers federal and Montana capital gains tax:

Federal tax. Short-term gains are taxed at your ordinary federal rate (estimated from your income bracket). Long-term gains use the 0% / 15% / 20% schedule, with the bracket chosen from your total taxable income and filing status.
Montana tax. Short-term gains are taxed at Montana’s ordinary 4.7% / 5.9% rates. Net long-term gains get Montana’s preferential treatment — about 3.0% in the lower bracket and 4.1% in the upper bracket.
Total. Federal plus Montana tax gives your combined liability on the gain.

Tips and example

A $20,000 long-term gain for a single filer with $80,000 of other income falls in the federal 15% long-term bracket ($3,000) and Montana’s upper preferential 4.1% rate ($820), for a combined $3,820 — about 19% of the gain.

Holding investments longer than one year is the single biggest lever: the same gain taxed short-term would face ordinary rates at both levels, often double the long-term cost. This tool ignores the federal 3.8% Net Investment Income Tax, so high earners should add that separately.