Rule 42.17.105 - COMPUTATION OF WITHHOLDING(1) Employers shall calculate the state income tax amount to withhold from employees according to the length of the payroll period, the employee's net taxable earnings, the employee's federal filing status, and any extra withholding reported on Form MW-4, using the department's "Montana Withholding Tax Tables." The tables are based on the formulas provided in (2) and (3) and show the amount to withhold each pay period.(2) Montana withholding tables are based on the following annual withholding formulas as adjusted annually for inflation and changes to federal tax parameters. Wage withholding is equal to the following amounts based on the employee's federal filing status: (a) Single or married filing separately: (i) 0% of the first $14,600; plus(ii) 4.7% of the next $20,500; plus(iii) 5.9% of the net taxable earnings over $35,100.(b) Married filing jointly or qualifying widow(er):(i) 0% of the first $29,200; plus(ii) 4.7% of the next $41,000; plus(iii) 5.9% of the net taxable earnings over $70,200.(c) Head of household:(i) 0% of the first $21,900; plus(ii) 4.7% of the next $30,750; plus(iii) 5.9% of the net taxable earnings over $52,650.(3) Withholding formulas for nonannual payroll periods are calculated by dividing the dollar amounts for annual payroll in (2) by the ratio of the number of working days in a year to the number of working days in the payroll period. The following table shows payroll periods and the corresponding divisors: Payroll Period | Divisor |
Monthly | 12 |
Semi-Monthly | 24 |
Biweekly | 26 |
Weekly | 52 |
Daily | 365 |
(4) By the end of each tax year, the department shall adjust the withholding formulas for inflation by either multiplying the dollar amounts in (2) by the inflation factor defined in 15-30-2101, MCA, or by updating the values based on the adjusted amounts provided by the IRS for the new tax year.(5) If the department determines that the inflation adjustment is immaterial, it may keep existing withholding tables in effect for another year.Mont. Admin. r. 42.17.105
NEW, 1982 MAR p. 2152, Eff. 12/17/82; AMD, 1983 MAR p. 996, Eff. 7/29/83; AMD, 1986 MAR p. 2066, Eff. 12/27/86; TEMP, AMD, 1987 MAR p. 1564, Eff. 9/11/87; AMD, 1987 MAR p. 2244, Eff. 12/11/87; AMD, 1989 MAR p. 230, Eff. 1/27/89; AMD, 1990 MAR p. 121, Eff. 1/12/90; AMD, 1991 MAR p. 129, Eff. 2/1/91; AMD, 1992 MAR p. 2776, Eff. 12/25/92; AMD, 1993 MAR p. 1111, Eff. 5/28/93; AMD, 1993 MAR p. 3045, Eff. 12/24/93; AMD, 2001 MAR p. 1650, Eff. 8/24/01; AMD, 2004 MAR p. 2754, Eff. 11/5/04; AMD, 2008 MAR p. 65, Eff. 1/18/08; AMD, 2010 MAR p. 177, Eff. 1/15/10; AMD, 2016 MAR p. 1974, Eff. 10/29/2016; AMD, 2019 MAR p. 2384, Eff. 12/28/2019; AMD, 2024 MAR p. 2324, Eff. 9/21/2024AUTH: 15-30-2620, MCA; IMP: 15-30-2103, 15-30-2502, MCA