The bill amends existing tax laws in Montana to clarify that certain income generated by tax-exempt organizations is considered unrelated business income and therefore subject to taxation. Specifically, it modifies Section 15-31-102 to include new provisions that define unrelated business taxable income and establish that rental income from leasing agricultural property and income derived from providing accommodations are taxable under the state's corporate income tax laws. The bill also introduces exceptions to the tax exemption for certain organizations, ensuring that any unrelated business income exceeding a federal threshold of $100 is taxed similarly to other corporate income.

Additionally, the bill amends Section 15-30-3404 to outline the election process for audited partnerships regarding the reporting and payment of taxes owed by their partners. It specifies the timeline for filing federal adjustments reports and the penalties for late submissions. The bill's provisions will take effect for income tax years beginning after December 31, 2025, thereby providing a clear framework for the taxation of unrelated business income for tax-exempt organizations in Montana.

Statutes affected:
LC Text: 15-30-3404, 15-31-102
SB0099_1: 15-30-3404, 15-31-102
SB0099_1(2): 15-30-3404, 15-31-102
SB0099_1(1): 15-30-3404, 15-31-102