Montana Homestead Exemption: What Homeowners Need to Know and How to Apply

Are you taking advantage of Montana’s new property tax savings?

If you own a home in Montana, there is an important property tax benefit you should know about. Montana has introduced a new Homestead Reduced Property Tax Rate designed to provide property tax relief to qualifying homeowners who use their property as their primary residence.

Whether you’ve owned your home for years or recently purchased a property in Billings, Red Lodge, or the surrounding communities, understanding this program could help you save money on your property taxes.

What Is the Montana Homestead Reduced Tax Rate?

Beginning in 2026, Montana implemented a new property tax structure that offers reduced tax rates for qualifying primary residences.

The goal is to provide property tax relief to Montana residents who live in their homes year-round or for the majority of the year, while distinguishing these properties from vacation homes, second homes, and short-term rentals.

Unlike a traditional tax exemption that removes a specific dollar amount from your property’s taxable value, Montana’s new program applies a reduced, tiered tax rate to eligible homes.

Who Qualifies?

To qualify for Montana’s Homestead Reduced Property Tax Rate, homeowners generally must meet the following requirements:

• Primary residence: The home must be your principal residence for at least seven months of the year.
• Ownership: You must own the property. Certain qualifying revocable trusts may also be eligible.
• Property taxes: You must be current on your property tax payments.
• One qualifying residence: You may claim the reduced rate on only one principal residence.

Eligible properties may include single-family homes, condominiums, townhomes, and qualifying manufactured homes.

Second homes, vacation properties, and short-term rentals do not qualify for the primary residence reduced rate.

How Much Could You Save?

The amount of savings depends on your property’s taxable market value, applicable tax rates, and local property tax levies.

For 2026, Montana introduced the following tiered rates for qualifying primary residences:

These are property tax classification rates, not the percentage of your home’s value that you pay directly in taxes. Actual property tax bills depend on additional calculations and local mill levies.

For many Montana homeowners, the reduced rate can mean meaningful savings.

How to Apply for Montana’s Homestead Reduced Tax Rate

The application process is straightforward and can be completed online.

Homeowners who prefer a paper application can obtain one through the Montana Department of Revenue.

Important: The 2027 Application Deadline

If you received a qualifying Montana property tax rebate in 2025 and continue to own and occupy the same home, you may already be enrolled automatically.

However, if you purchased a home, moved, changed ownership, or did not receive the applicable rebate, you should verify your status and apply if necessary.

Even if you believe you are already enrolled, checking your status is a smart idea.

What If You Recently Purchased a Home?

This is especially important for Montana homebuyers.

If you recently purchased a home that previously qualified for the reduced rate, that classification may remain in effect for the rest of the current tax year.

The reduced rate does not automatically transfer to you for future years.

New homeowners should apply under their own ownership information to ensure they receive the benefit for the following tax year.

If you’re buying or selling a home in Billings, Red Lodge, or anywhere in Montana, this is an important item to include on your homeowner checklist.

What If You Missed the 2026 Deadline?

The enrollment deadline for the 2026 tax year was March 20, 2026.

If you missed that deadline but otherwise qualified, Montana has established a property tax refund process for certain eligible homeowners who did not receive the reduced rate. Check with the Montana Department of Revenue for the refund eligibility requirements and application instructions. You should also enroll separately for 2027 if you qualify.

Is This the Same as a Montana Homestead Declaration?

No, and this is an important distinction. Montana actually has two different homestead protections:

Filing a Homestead Declaration does not automatically qualify you for the reduced property tax rate, and applying for the reduced tax rate does not establish creditor protection.

Homeowners may want to consider both programs depending on their circumstances.

Don’t Miss an Opportunity to Save

With changing property tax laws in Montana, it’s more important than ever for homeowners to understand the benefits available to them.

Taking a few minutes to verify your Homestead Reduced Tax Rate enrollment could make a difference in your annual property tax bill.

For more information, visit the Montana Department of Revenue at homestead.mt.gov or call 406-444-6900.

Disclaimer: This article is provided for general informational purposes and is not legal or tax advice. Property tax regulations and deadlines may change. Always confirm current eligibility requirements with the Montana Department of Revenue or consult a qualified tax or legal professional.