Montana 2025 Regular Session

Montana Senate Bill SB538

Introduced
3/24/25  
Refer
3/25/25  

Caption

Provide income tax deduction for qualified business income

Impact

The implications of SB538 on state laws focus on altering the tax landscape for business owners, providing a direct financial benefit by potentially lowering their state tax obligations. It is intended to create a stronger environment for entrepreneurship in Montana by aligning state tax deductions more closely with federal provisions. Such changes reflect a strategic shift towards supporting local businesses, especially in light of the economic challenges faced in the post-pandemic landscape.

Summary

Senate Bill 538 is introduced to revise income tax deductions in Montana, specifically addressing the tax treatment of qualified business income. The bill seeks to allow individuals to deduct an amount equal to the qualified business income deduction under Section 199A of the Internal Revenue Code, which could significantly impact taxpayers who are business owners or involved in pass-through entities. This adjustment aims to provide superior tax relief for small business owners, encouraging economic growth and viability within the state.

Sentiment

The general sentiment surrounding SB538 appears to be supportive among business associations and economic advocates, who view it as a positive step towards enhancing the competitiveness of Montana's small businesses. However, apprehensions exist among some minority groups and fiscal watchdog organizations, which may perceive a potential loss of tax revenues for the state treasury as a downside to the bill's passage. This debate reveals an ongoing struggle between stimulating business growth and ensuring adequate funding for public services.

Contention

One notable point of contention pertains to the balance between the benefits to taxpayers and the potential shift in tax revenue that could undermine state funding for essential services. Critics may argue that while the bill supports business owners, it could simultaneously restrict the state’s financial flexibility in addressing public sector needs. Discussions in committee sessions may raise questions about how to ensure that modifications in tax policy do not adversely affect the overall health of Montana’s economy or its ability to fund vital programs.

Companion Bills

No companion bills found.

Previously Filed As

MT HB235

Revise social security income taxation

MT SB104

Exempt retired military pensions from state income tax

MT SB550

Generally revise income tax laws and clarify income tax reform provisions

MT SB514

Provide for individual income tax refunds of surplus revenue

MT HB221

Revise income tax rates for net-long term capital gains

MT HB219

Exempt certain military pensions and survivor benefits from income taxes

MT HB345

Exclusion from federal taxable income for medical savings accounts

MT HB526

Repeal state tax on social security income

MT HB192

Use surplus revenue for income tax and property tax refunds and payment of bonds

MT SB537

Provide tax incentives for the sale of Montana-produced food

Similar Bills

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NJ A3466

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NJ A2534

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AZ HB2278

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