House Bill No. [insert bill number] proposes an amendment to the Montana income tax code that specifically addresses the treatment of income from the sale of newly constructed residences. The bill allows taxpayers to exclude 50% of the income from the sale of a newly constructed single-family residence or duplex, provided the sale price is below 85% of the county median residential value, as determined by the most recent periodic reappraisal. However, this exclusion is not applicable if the taxpayer receives additional compensation that, when combined with the sales price, exceeds the 85% threshold. The bill also mandates that the county median residential value be calculated every two years as part of the periodic reappraisal process.

In addition to the new exclusion, the bill modifies existing tax laws by disallowing a subtraction for taxpayers who exceed the 85% threshold with additional compensation. It also introduces a provision that allows taxpayers to deduct the fair market value of donated technological equipment to educational institutions, provided certain conditions are met. The definition of "county median residential value" is established as the median value of a single-family residence, including land, rounded to the nearest thousand dollars. The provisions of this act will take effect for income tax years beginning after December 31, 2025.

Statutes affected:
LC Text: 15-30-2120, 15-31-114
HB0895_1(1): 15-30-2120, 15-31-114
HB0895_1(2): 15-30-2120, 15-31-114
HB0895_1(3): 15-30-2120, 15-31-114
HB0895_1: 15-30-2120, 15-31-114