Governor Steve Bullock and Lt. Governor Mike Cooney today highlighted a tax credit for up to 75,000 low and middle-income Montanans that is available for the first time after receiving approval from the Legislature in 2017.
“This tax credit will benefit nearly 75,000 working Montanans and help them provide basics for their families such as groceries and gas,” Governor Bullock said. “In addition to lifting families out of poverty, the tax credit gets dollars invested in communities across the state to support local economies.”
The Montana Earned Income Tax Credit, sponsored by Rep. Tom Jacobson in 2017, passed with bipartisan support to provide an additional tax credit to low and middle-income workers. Montana is one of 29 states with an earned income tax credit, based on the federal Earned Income Tax Credit. The federal tax credit has been effective in lifting millions of American families above the poverty line and increasing their quality of life.
For most Montanans, the state tax credit is worth 3 percent of the federal Earned Income Tax Credit. The tax credit is refundable, meaning those who don’t owe any taxes can still receive the credit. If the credit is more than what is owed, taxpayers receive the difference. Only two weeks into tax season, nearly 20,000 Montanans have already filed for the credit.
Montanans who claimed the federal tax credit last year received an average credit of $2,178. The two tax credits combined will provide Montanans with hundreds to thousands of dollars that will be invested in local communities.
“This tax credit, especially when combined with the Federal Earned Income Tax Credit, can make a meaningful difference for Montana families,” Lt. Gov. Cooney said. “Thousands of Montanans have already taken advantage of this tax credit for the first time and it’s critical everyone carefully review the eligibility criteria to ensure they don’t miss out on this refundable credit.”
Eligibility for the credit is determined by the IRS and can be reviewed here: https://mtrevenue.gov/EITC.
The Montana Department of Revenue encourages Montanans who may qualify for the EITC to start working on their tax returns early. Electronic filing is the fastest and most secure way to claim the credit and file a return. Because of efforts to protect Montanans from fraud, filers should allow 90 days to receive their refunds.
Tax help events will be hosted around the state where preparers can help Montanans determine if they are eligible for the credit and help file returns. Visit https://mtrevenue.gov/taxhelp for organizations hosting tax help events and information on approved tax preparation software.