This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

(1) The value of exempt intangible personal property will be for the amount stated in the taxpayer's accounting records subject to review and verification by the department.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

(1) Except as provided in (5) and (7), personal property is valued annually using the cost approach to market value. The market value is determined by multiplying a trended depreciation percentage times the installed original cost of the property. The department has established specific categories of personal property which are provided in ARM 42.21.155.

(2) Taxable supplies, defined in ARM 42.21.160, are valued at 100% of their acquired cost.

(3) Leased or rental equipment that is not exempt under 15-6-202 or 15-6-219, MCA, is taxable and is valued in the same manner as similar non-leased equipment. Property brought into the state that meets the requirements under 15-6-202, MCA, is not taxable unless it is sold or otherwise disposed of in the state.

(4) Rental videos that are not exempt under 15-6-202 or 15-6-219, MCA, are taxable and have a trended percent good of 25% in year one, 15% in year two, and 10% each year thereafter.

(5) Locally assessed television cable system transmission line is valued at $2,000 per mile; service drops are valued at $25 each.

(6) All downhole equipment installed in oil and gas wells, such as sucker rods, tubing, casing, and submersible pumps are exempt from taxation. Downhole equipment not installed in an oil or gas well as of the January 1 assessment date is taxable.

(7) For farm machinery and equipment and heavy equipment, the department will apply the valuation methods in descending order beginning with the method in (a) and proceeding, where necessary, through the method in (d) until a market value can be determined for the equipment.

(a) The market value will be the "average wholesale" or a comparable category of value as shown in the online version of the national agricultural and implement valuation guide known as Equipment Watch (Equipment Watch), as of September-October of the year prior to the year of assessment. Equipment Watch is adopted and incorporated by reference in accordance with 15-8-111, MCA, and may be reviewed in a department field office or purchased from the publisher: Informa Business Media, Inc., 1166 Avenue of the Americas, 10th Floor, New York, NY 10036.

(b) If market value cannot be determined under (a), the department will approximate average wholesale value of farm machinery and equipment through application of its Farm Machinery Manual dated January 1, 1998, which the department adopts and incorporates by reference into this rule. The purpose of the Farm Machinery Manual is to function as a resource to approximate average wholesale value of farm machinery and equipment. The Farm Machinery Manual may be reviewed in a department field office or a copy of the Manual may be requested from the Department of Revenue, Property Assessment Division, P.O. Box 8018, Helena, MT 59604-8018.

(c) For all farm machinery and equipment, and heavy equipment that cannot be valued under (a) and (b), the department may determine a trended average wholesale value if an average wholesale value is available for the same make and model with a different year new. The trended average wholesale value will be determined by trending the average wholesale value as found in Equipment Watch, for the same make and model with a different year new.

(d) If the valuation methods in (a) through (c) cannot be used, the owner or applicant must certify to the department the year acquired and the acquired price. If the item was acquired through a means other than the open marketplace, the owner must provide a reasonable estimate of the item's value at the time of acquisition. The reported value will be trended and depreciated. If the owner fails to provide this required information or in the department's opinion the information provided does not accurately reflect the item's fair market value, the department may estimate the fair market value of the farm machinery and equipment, or heavy equipment item.

(8) Items of farm machinery and equipment valued below $100 are exempt from taxation. 

(1) The department has established eight categories of personal property for determination of trend factors and depreciation, and trended depreciation schedules of four, five, ten, fifteen, or twenty years have been assigned for each category based on its type and expected useful lifespan, as provided in (4). The equipment listings in (4) provide representative examples of property in a category and are not meant to be an exhaustive list. 

(2) Each trended depreciation schedule contains a residual trended percent good, designated as "older" in the final row of each schedule, which is applied to an item of personal property that exceeds the typical lifespan because personal property remains taxable until its disposal. The purpose of trended depreciation is to bring the cost of equipment acquired in a previous year to an approximate current cost before depreciating it.

(3) Prior to January 1 of each year, the department will use cost index trends for equipment and depreciation percentages for furniture and fixtures from the previous July's edition of Marshall & Swift Valuation Service Guide (Marshall & Swift Guide) to calculate the trend factors and the trended percent good for the schedules in (4). The Marshall & Swift Guide is a widely recognized valuation authority which the department adopts and incorporates by reference. The Marshall & Swift Guide may be reviewed at the department's central office or purchased from the publisher: Corelogic, 40 Pacifica Street, Suite 900, Irvine, California 92618.

(a) The trends from the Marshall & Swift Guide represent industry-wide national average changes in equipment costs - customarily increases - from the base year, 1926. Trends are typically greater than a value of one, but may be less than one.

(b) For trended depreciation schedules, the department calculates the year one trend for each schedule as the average trend of the first three quarters of the current year. The trend for each successive year is the final trend for that year.

(i) Using year one as the base year, the department calculates the changes in equipment costs - the trend factors - for each schedule in (4), as the quotient of the year one trend and any following year's trend.

(ii) The department then uses the depreciation percentages from the Marshall & Swift Guide to calculate the "percent good" over the period of years that is typical for each property category. Trended percent good is then calculated as the product of the percent good and the trend factor for each year represented in a schedule.

(4) The department shall post its trended depreciation schedules for the upcoming tax year for the categories of personal property described below on the department's website located at http://www.mtrevenue.gov. The department adopts and incorporates by reference its 2024 Personal Property Depreciation Schedules and Trend Tables publication, effective January 1, 2024. The Depreciation Schedules and Trend Tables publication contains the detailed schedules and tables the department uses for valuing personal property and industrial machinery and equipment. The personal property categories and trended depreciation methodologies that apply to the Depreciation Schedules and Trend Tables publication are as follows:

(a) Computerized Equipment - a four-year depreciation and a residual percentage will be applied to computerized equipment such as computers, peripheral equipment that cannot function independently of a computer, computerized medical equipment, and gaming machines. The four-year depreciation schedule was developed and implemented after consultation with industry representatives; the trend factors are calculated from the office equipment category of the Marshall & Swift Guide.

(b) Office and Commercial Equipment - a five-year depreciation and a residual percentage will be applied to non-computerized equipment such as office equipment and furnishings, specialized medical equipment, janitorial equipment, coin-operated washers and dryers, beauty and barber shop equipment, tanning beds, furnishings for hotels, motels, rental apartments, rental homes, nursing home and other care facilities, and locally assessed cable tv dishes. The trend factors are calculated from the office equipment category of the Marshall & Swift Guide.

(c) Furniture, Fixtures, and Miscellaneous Equipment - a ten-year depreciation and a residual percentage will be applied to all other commercial furniture and fixtures such as handheld and non-handheld shop and construction tools and equipment, medical and dental chairs and tables, theater equipment, survey equipment, billboards and signage, garbage bins, coin-operated pool and other game tables, gas pumps, bar and restaurant equipment and furnishings, bowling alleys and equipment, excepting auto-scorers which have a four-year depreciation, photo and developing equipment, mortuary equipment, safes, security systems, port-a-potties, locally assessed cable tv towers, ski lift equipment including aerial lifts, surface lifts, portable lifts and tows including the towers, cables, ropes, sheave assemblies, the conveying devices, power units, and all accessories. The trend factors are calculated from the average of all category of the Marshall & Swift Guide.

(d) Seismograph Units and Allied Equipment - a five-year depreciation and a residual percentage will be applied to seismograph units and allied equipment. An 80 percent wholesale factor is used for wheeled seismograph units. The trend factors are calculated from the chemical industry category of the Marshall & Swift Guide.

(e) Oil Drilling, Workover, and Service Rigs - a ten-year depreciation and a residual percentage will be applied to all oil drilling, workover, and service rigs. An 80 percent wholesale factor is applied to self-propelled wheeled workover and service rigs. The trend factors are calculated from the chemical industry category of the Marshall & Swift Guide.

(f) Oil and Gas Field Machinery and Equipment - a fifteen-year depreciation and a residual percentage will be applied to oil and gas field machinery and equipment. The trend factors are calculated from the chemical industry category of the Marshall & Swift Guide.

(g) Farm Machinery and Equipment - a twenty-year depreciation and a residual percentage will be applied to farm machinery and equipment. A 50 percent wholesale factor is applied. The trend factors are calculated from the average of all category of the Marshall & Swift Guide.

(h) Heavy Equipment - a twenty-year depreciation and a residual percentage will be applied to heavy equipment. A 50 percent wholesale factor is applied. The trend factors are calculated from the contractor's equipment category of the Marshall & Swift Guide.

This rule has been repealed.

This rule has been repealed.

(1) A taxpayer having property in the state of Montana on January 1 of each tax year, must complete the statement as provided in 15-8-301, MCA, by submitting a completed personal property reporting form.

(2) The statement must provide pertinent information about each item of personal property, including the year acquired, acquired cost, and installation cost. For any items acquired through a means other than the open marketplace, the owner must provide a reasonable estimate of the item's open market value at the time of acquisition. Multiple smaller items acquired in the same year can be reported as a group rather than itemized, such as hand-held tools.

(3) Personal property that is expensed or fully depreciated for other tax or accounting purposes remains taxable for property tax purposes and must be reported.

(4) For the purposes of this rule, the statewide aggregate market value of a taxpayer's personal property includes all property owned, claimed, possessed, controlled, or managed by an individual or business entity, either directly or indirectly through an affiliated entity or family member, unless that property is specifically exempted by law.

(5) As used in this rule, "affiliated entity" means:

(a) a member of a combined group of unitary corporations filing a Montana corporation license tax return;

(b) a member of an affiliated group of corporations filing a U.S. Consolidated Income Tax Return;

(c) any corporation if the individual or business entity directly or indirectly owns more than 50 percent of the stock value or voting power;

(d) any partnership if the individual or business entity directly or indirectly owns more than 50 percent of the capital interest in, or the profits of, the partnership;

(e) a corporation and a partnership if the same persons own:

(i) more than 50 percent in value of the corporation's stock; and

(ii) more than 50 percent of the capital interest in, or the profits of, the partnership;

(f) an S corporation and another S corporation, if the same individuals own more than 50 percent in value of the outstanding stock of each corporation;

(g) an S corporation and a C corporation, if:

(i) the same individuals own more than 50 percent in value of the outstanding stock of each corporation; and

(ii) any trust, if the individual or business entity is the grantor or a beneficiary.

(6) For purposes of applying (4) and (5):

(a) stock owned, directly or indirectly, by or for a corporation, partnership, estate, or trust is considered as being owned proportionately by or for its shareholders, partners, or beneficiaries; and

(b) an individual is considered as owning the stock, directly or indirectly, by the individual's spouse or minor child.

(7) As determined by the department, if the statewide aggregate market value of an individual's or business entity's class eight property is less than or equal to the exemption provided in 15-6-138, MCA, the individual's or business entity's class eight property is exempt from taxation. If the aggregate market value of an individual's or business entity's class eight property is greater than the exemption provided in 15-6-138, MCA, the market value of an individual's or business entity's class eight property that is greater than the exemption is subject to taxation.

(8) The department will apply the exemption and the applicable tax rates identified in (a) and (b) to an individual's or business entity's class eight property by adding together the statewide market value of class eight property owned by the individual or business entity to determine the aggregate market value. If the aggregate market value of class eight property is:

(a) less than or equal to the exemption provided in 15-6-138, MCA, the taxable market value of the property is zero; or

(b) greater than the exemption provided in 15-6-138, MCA, the department will apply the exemption proportionally among each property owned, apply the 1.5 percent taxable rate to the first $6,000,000 in excess of the exemption, and apply the 3 percent taxable rate to the remaining taxable market value.

(9) When the department requires a personal property statement/reporting form as provided in 15-8-301, MCA, the statement/reporting form shall advise the taxpayer that they are subject to penalty under the provisions of 15-1-303 and 15-8-309, MCA, or any other applicable statute, for refusing or neglecting to respond to the department's request for information. The taxpayer's completed personal property statement/reporting form must be returned to the department by electronic submission or postmarked no later than March 1.

(10) A taxpayer's completed statement/reporting form with an electronic date stamp or postmarked after March 1 will be subject to the penalties referenced in (9) unless the taxpayer provides:

(a) evidence of their inability to comply with the timeframes due to hospitalization, physical illness, infirmity, or mental illness; and

(b) evidence that this/these condition(s), while not necessarily continuous, existed at sufficient levels in the period of January 1 to March 1 to prevent timely filing of the reporting form.

(11) Personal property owners whose aggregate class eight market value is less than or equal to the exemption provided in 15-6-138, MCA, as defined in (4), will have no further reporting obligation, except:

(a) if the property owner acquires new personal property, the value of which brings the aggregate market value of the personal property above the exemption provided in 15-6-138, MCA, the taxpayer must notify the department and complete a personal property statement/reporting form for the applicable tax year; or

(b) if the department requests the property owner to complete a personal property statement/reporting form as required by 15-8-301, MCA, or as a result of an audit and review of taxable value authorized by 15-8-104, MCA, and ARM 42.21.159.

(12) New businesses are not required to submit a personal property statement/reporting form if the entity's business equipment is valued at less than or equal to the exemption provided in 15-6-138, MCA, unless requested by the department in accordance with (11).

(13) Industrial and commercial property taxpayers shall provide documentation of the installed costs of intangible personal property included on the taxpayer's accounting records, or provide other alternative methodologies or information regarding market value for consideration by the department. 

(1) The department may conduct audits and reviews of commercial property. These audits and reviews will be performed in order to implement 15-8-104, MCA.

(2) For purposes of audits and reviews, the department may utilize information supplied by the Secretary of State, Department of Livestock, Department of Revenue, Department of Agriculture, Department of Commerce, Federal Farm Services Agency, Federal Natural Resource Conservation Service, department developed models or comparative studies, and local government entities to determine the taxable value of the property subject to taxation.

(3) The purpose of property audits and reviews is to ensure that property owners are returning correct and accurate cost data on property returns, and that all taxable property has been reported for assessment purposes.

(4) The department will seek access to the following records for purposes of conducting the audits and reviews, pursuant to 15-8-304, MCA:

(a) personal property returns on file in the department's field offices;

(b) income statements, receipts of purchase, asset listings, asset registers, asset ledgers, purchase rental program agreements, and any information in the possession of the property owner or lessee which would reflect capital asset investment costs;

(c) any depreciation schedules, age/life programs, asset life schedules, or capital asset investment recovery records in the possession of the commercial personal property taxpayer or his representative; and

(d) any other information in the possession of the department and/or property owner or lessee which is necessary in order to conduct a thorough audit or review.

For purposes of this chapter the following definitions apply:

(1) "Affiliated entity" has the meaning given the term in ARM 42.21.158.

(2) "Aggregate" means the total sum of all class eight assets owned, claimed, possessed, controlled, or managed directly or indirectly through an affiliated entity by a person within the state.

(3) "Business entity" means an organization engaged in the production, manufacture, distribution, purchasing, or sale of an article of commerce. Such organizations include but are not limited to:

(a) a limited liability company treated for tax purposes as a sole proprietorship;

(b) a corporation (foreign or domestic);

(c) a not-for-profit corporation;

(d) a profit and not-for-profit unincorporated association;

(e) a business trust;

(f) limited liability company;

(g) limited liability partnership;

(h) a small business corporation; or

(i) a partnership.

(4) "Commercial personal property" means all property, other than real property and real property improvements, which is used for the production of income.

(5) "Dealer purchase incentive rental program" is a program operated by equipment dealerships where the equipment is owned by the dealer and held for sale. The dealer is allowed to rent the equipment to a single user on a short term basis as an incentive for sale of the equipment.

(6) "Dealer lease program" is a program operated by equipment dealerships where the equipment is owned by the dealer and is leased to a consumer.

(7) "Dealer rental program" is a program operated by equipment dealerships where equipment is owned by the dealer, held for rent to consumers and is depreciated as an asset.

(8) "Dealer sales program" is a typical sales program where equipment is owned by the dealer and held for sale.

(9) "Family member," as used in ARM 42.21.158, means spouse or minor child.

(10) "Individual" has the meaning given to the term "person" as found in ARM 42.2.304.

(11) "Levy district" means a geographically distinct area where the same mill levies apply to all of the properties.

(12) "Taxing jurisdiction" means a governmental subdivision with the authority to tax.

(13) "Taxable supplies" include all tangible materials used or consumed in a business except those tangible materials which are held by a taxpayer as his stock-in-trade for sale in the ordinary course of business. Taxable supplies do not include raw materials that are part of the final product. Examples of taxable supplies include, but are not limited to:

(a) fuel used in operations;

(b) parts held for repair of machinery; and

(c) chemicals used in process operations.

(a) If taxable personal property is moved from one county to another and the county in which it is located on January 1 fails to assess the property, the county to which the property moves may assess the property for the entire year.

(2) If property enters the state after January 1, the taxable situs of the property shall be the levy district wherein the property comes to rest and becomes a part of the general property of the levy district.

(a) If the property is required to be immediately licensed, the taxable situs shall be the levy district wherein licensure is required.

(1) In compliance with 15-8-201 and 15-8-301, MCA, all personal property subject to taxation shall be taxed to the owner or person in control or possession of the property as of midnight on January 1 of each tax year provided the personal property is not in an exempt status.

(2) In all cases in which an application for personal property tax is required by law, the application for exemption must be filed before March 1 of the year for which the exemption is sought. If the applicant acquires the personal property after January 1, they must submit an application for exemption:

(a) by March 1; or

(b) within 30 days of acquisition of a motor vehicle.

(3) If the property has taxable situs in Montana on January 1 and the taxpayer is being assessed for the first time for the property, the application for exemption is due upon the later of March 1 or 30 days after acquisition of the property.

(4) The deadline may be extended by the local department field office for good cause.

(5) For personal property situated within the state of Montana on January 1, the exempt and nonexempt status of personal property is as follows:

(a) If personal property is in an exempt status on January 1 of a specific tax year, and at any later date during that tax year loses its exempt status, the personal property will not be taxed until the following tax year.

(b) If the personal property is not in an exempt status on January 1 of a tax year, and at any later date during that tax year is assigned an exempt status, the personal property will be taxed for the entire tax year, unless the personal property is acquired by a governmental entity.

(6) Personal property acquired during the year by a governmental entity as defined in 15-6-201, MCA, is exempt on proof of ownership. This property remains exempt for the remainder of the year from the date of acquisition by the governmental entity.

(a) If the taxes are paid for the year, the owner, as of January 1, may apply for a refund of taxes for the portion of the year the property is in government ownership.

(b) If the taxes are not paid, the assessment and taxes will be prorated.

(c) Applications for refund must be submitted to the county commissioners office of the county in which the tax is paid. The application must comply with the requirements of 15-16-603, MCA.

(7) For personal property situated outside the state of Montana on January 1, the exempt and nonexempt status of personal property is as follows:

(a) If personal property is in an exempt status when it is brought into the state of Montana during a tax year, and if at any later date during that tax year the personal property loses its exempt status, the personal property will not be taxed until the following tax year.

(b) If personal property is not in an exempt status when it is brought into the state of Montana, the department will prorate the taxes on the personal property pursuant to 15-16-613, 15-24-301, and 15-24-303, MCA.

(2) The application must contain:

(a) the name and current mailing address of the applicant;

(b) a complete description of the personal property;

(c) the Montana property tax bill for the personal property under consideration with proof of full payment;

(d) the date the personal property was removed from the state;

(e) the location of the personal property upon removal from the state; and

(f) proof that a property tax was paid on the personal property in another state, such as a verified paid property tax receipt.

This rule has been repealed.

(1) A livestock owner or the livestock owner's agent must submit a livestock reporting form, electronically or in writing, to the department no later than March 1 annually.

(2) The reporting form required in (1) must list the livestock type and count, by county, where livestock are located on February 1. For all poultry and honey bees, swine 3 months of age or older, and all other livestock 9 months of age or older, the livestock owner/producer shall report the number of animals within each of the following established categories:

(a) horses, mules, and asses (ponies, donkeys, burros);

(b) cattle (heifer and steer calves 9 months and older, yearlings, cows, and bulls);

(c) domestic bison;

(d) sheep;

(e) swine;

(f) goats;

(g) poultry (chickens, turkeys, geese, ducks, and other domestic birds raised as food or to produce feathers);

(h) honey bee hives;

(i) alternative livestock (privately owned caribou, mule deer, whitetail deer, elk, moose, antelope, mountain sheep, mountain goats indigenous to Montana);

(j) ostriches, emus, and rheas; and

(k) llamas and alpacas.

(3) Livestock owners that bring livestock into the state after February 1 of the current year are required to complete and submit a livestock reporting form to the department by March 1 of the following year.

(4) If a livestock owner fails to submit a completed livestock reporting form by the March 1 deadline, the department shall use the owner's reported or estimated livestock counts from the previous year to estimate the livestock type and count for the current year.

(5) Per capita livestock fee payments are due to the department by March 1 of the reporting year. Livestock owners may be entitled to a per capita fee refund from the Montana Department of Livestock (DOL), under the provisions of 15-24-922, MCA, for livestock located out of the state during the reported tax year.

(6) The department provides DOL with livestock reporting and billing/payment data for compliance purposes. If DOL determines that a livestock owner has not been reporting their livestock counts to the department as required, DOL may provide the department with estimated livestock type and counts and the department will use this information to bill the livestock owner for the per capita livestock fees.

This rule has been transferred.

This rule has been transferred.

This rule has been transferred.

This rule has been transferred.

This rule has been transferred.

This rule has been transferred.

This rule has been transferred.

This rule has been transferred.

This rule has been transferred.

This rule has been transferred.

This rule has been transferred.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.