Montana Earned Income Tax Credit

Montana offers an Earned Income Tax Credit that puts money back in your pocket. For most taxpayers, it equals 10 percent of your federal EITC. The credit is refundable. That means if the credit is more than the tax you owe, you get the difference back as cash.

You may qualify if you were a Montana resident and you claimed the federal Earned Income Tax Credit on your federal return. To check your federal eligibility, the state points you to the IRS EITC Assistant. Whether you qualify is decided on your return.

Claim the credit on the Montana Individual Income Tax Return, called Form 2. You can file and pay through the Montana Department of Revenue's TransAction Portal, or TAP. Free tax-preparation sites can file both your federal and state returns and claim the credit at no cost.

The Montana Earned Income Tax Credit is set in state law at Montana Code Annotated section 15-30-2318. Because it is refundable, a low-income worker who owes little or no tax can still get money back. That is the point of the credit.

Some people skip filing because they think they owe nothing. That can leave money on the table. If you qualified for the federal EITC, file a Montana return so you do not miss the state credit. For questions, the Department of Revenue Helena office is at 406-444-6900.

The EITC pairs well with other help. If money is tight, the same tax season is a good time to check SNAP and Medicaid at apply.mt.gov. Dial 2-1-1 to find a free tax-preparation site near you that can file both returns.