MT HB827

Lowers income thresholds for Montana taxation of Social Security benefits: single/head of household "base amount" reduced from $40,000 to $32,500, and "adjusted base amount" from $49,000 to $41,500

Reduces thresholds for married couples filing jointly: "base amount" lowered from $65,000 to $48,500, and "adjusted base amount" from $77,000 to $60,500

Married taxpayers filing separately who lived with their spouse at any time during the year will have both base amounts set at $0, meaning all Social Security benefits become potentially taxable

Adds tier 1 railroad retirement benefits to the same modified calculation method as Social Security benefits for Montana state taxes

Effective January 1, 2026, applying to tax years beginning after December 31, 2025