As the Montana Legislature enters its late-session rush, Gov. Greg Gianforte’s property tax relief proposal has been revived. The plan aims to lower taxes on primary residences and long-term rentals while raising them on secondary homes and short-term rentals like Airbnb. This approach targets out-of-state property owners, limiting the tax shift onto business properties.
Initially, House Bill 231 narrowly failed in the Senate with a 25-25 vote. Concerns included increased taxes on Montana residents with multiple properties. However, lawmakers amended these provisions into a new bill, Senate Bill 542, which later passed a Senate reconsideration motion.
The House amendment, led by Speaker Brandon Ler, R-Savage, replaced the bill’s original text with provisions from other debated tax bills. This revision gained bipartisan approval. “We owe it to Montana to address this growing issue,” Ler stated. The amendment faced opposition from some lawmakers, including Rep. Katie Zolnikov, due to worries about additional tax burdens on resident property owners.
Key provisions in the amended bill include a “homestead” policy starting in 2026, offering a $400 homeowner rebate this year and revised tax valuation rates. These valuations target higher-value properties while adjusting rates for commercial properties to protect small businesses. An appeals process offers refunds for owners missing the homestead exemption, although automatic qualification for properties on Indian reservations was removed.
The bill also contains a coordination clause that nullifies House Bill 528 if both pass. SB 542, originally sponsored by Sen. Wylie Galt, R-Martinsdale, seeks Senate approval with possible further amendments. Competing proposals include HB 528 and Senate Bill 90, the latter favoring tax rebates over rate adjustments, clashing with the governor’s stance.
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