DanielV01
Expert Alumni

Get your taxes done using TurboTax

It is how Montana calculates tax.  Montana is not taxing all of your income in Montana.  What Montana does is pretend that all of your income is taxable in MT, calculates the tax on that amount, and then prorate the amount of tax according to the amount of income you actually earned in Montana.  In the tax return review, it appears like all of your income is taxed in Montana, but when you finish the return, you will see that it is not.  Only the percentage of your income earned in Montana will actually be taxed.

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