Montana Commercial Property Tax Appeals
In Montana the state values your property, the presumption runs against you — and your 2026 bill is built on what the Department of Revenue thought your building was worth on January 1, 2024. That stale date is where appeals are won.
The State Sets the Number — and the Number Is Two Years Old
Montana is one of the few states where the state itself values every property: the Department of Revenue appraises all class 4 commercial real estate on a two-year cycle and hands the counties a number to bill. Tax years 2025 and 2026 both rest on the department's estimate of market value as of January 1, 2024 — so a 2026 appeal isn't about today's market, it's about a market date that's already receding into history. Where values have softened since early 2024, the roll is stale by design.
The 2025 Legislature then rewrote the rate structure. The flat 1.89% commercial rate is gone: for 2026, commercial property pays 1.5% on the first $2,274,000 of market value and 1.9% above it — graduated tiers, applied to portions of value. Mills floated up as taxable values fell (Billings now levies about 762 mills), leaving effective commercial rates of roughly 0.85% to 1.5% of market value depending on where you sit.
The procedure favors the department — its appraisal is presumed correct, and the owner carries the burden. But 2026 delivered a counterweight: in O'Brien v. Department of Revenue, the Montana Supreme Court held the department must use the income approach for commercial condominium units whenever the owner supplies sufficient income information — reasoning that gives every income-property owner leverage — and that a county-board win the department doesn't appeal binds future cycles. The playbook just changed.
Every Date That Matters
Montana runs on a two-year cycle — one valuation, two tax years, and one properly-timed appeal that pays for both.
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June (cycle year one)Classification & appraisal noticesThe Department of Revenue mails notices once per two-year cycle — the 2025–2026 cycle's notices went out beginning June 30, 2025. A second-year notice arrives only if value, ownership, or classification changed.
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+30 daysAB-26 informal review — or straight to the county boardForm AB-26 filed within 30 days of the notice date preserves relief for both cycle years. It's optional — you may petition the county tax appeal board directly in the same 30 days — but filing it doesn't waive anything: the county-board clock resets to 30 days from the department's determination. One review per property per cycle.
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June 1 (cycle year two)The late-AB-26 backstopMissed the 30 days? An AB-26 can still be filed until June 1 of the second cycle year — 2026 in this cycle — but any adjustment applies to the second tax year only. Half a loaf, still worth claiming.
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+30 daysCounty Tax Appeal BoardThe CTAB petition is due within 30 days of the notice date — or 30 days from the AB-26 determination if you sought informal review first. The hearing is your evidentiary main event: the record built here follows the case up.
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45 / 30 daysMontana Tax Appeal BoardAppeal to MTAB within the later of 45 days after the county hearing or 30 days after the county decision is mailed. MTAB reviews the county record and may take additional testimony — it is not an unrestricted second trial, which is why the county-board record matters so much.
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+60 daysDistrict courtJudicial review of MTAB's final decision must be sought within 60 days, in the district court where the property sits — on the record, not a fresh evidentiary hearing.
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January 1Lien date — most businesses exemptThe first $1,000,000 of statewide aggregate equipment value is exempt (HB 212, 2023) — most Montana businesses owe nothing and, unless near the line or asked, don’t file at all. Above it, the excess is taxed at 1.5% up to the next $6 million and 3% beyond.
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February 15Reporting deadline — new for 2026Moved up from March 1 effective tax year 2026 (ARM 42.21.158). Filing runs through the TransAction Portal, pre-populated with last year’s list. Late or missing reports draw a 20% penalty on the assessment.
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March 1Entity exemption applicationsEquipment owned by or leased to nonprofits isn’t automatically exempt — applications are due March 1 (vehicles: within 30 days of acquisition).
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+30 days from noticeAppeal — informal review or straight to the county boardThirty days from the classification-and-appraisal notice to request informal review (Form AB-26) or file directly with the County Tax Appeal Board. From a CTAB decision, the Montana Tax Appeal Board window is the later of 45 days after the hearing or 30 days after the decision mails. Centrally assessed taxpayers get just 20 days at the first step.
Statutory basis: MCA 15-7-102 (notices and AB-26), 15-15-102 (county board), 15-2-301 (MTAB), 15-2-303 and MAPA (judicial review). To preserve refund rights while an appeal runs, pay each installment under protest (MCA 15-1-402). Next reappraisal cycle: 2027–2028, valued as of January 1, 2026. Personal property: reporting ARM 42.21.158 (Feb. 15 from TY2026); exemption MCA 15-6-138 (
M, HB 212); penalty MCA 15-1-303; MTAB window MCA 15-2-301.
Tiered Rates on a Stale Value
The formula is three steps: the department's market value × the class rate = taxable value, and taxable value × your local mills = the bill. For 2026 the class rate is tiered — 1.5% below the $2,274,000 threshold (six times the statewide median commercial value), 1.9% above — so a $10 million Billings property carries about $181,000 of taxable value and, at 762 mills, roughly $138,000 a year.
Every input except the mills is the department's. That's why the valuation date matters so much: the 2026 number is a January 1, 2024 opinion, formed by a mass-appraisal model in Helena — and in a non-disclosure state where sale prices are confidential, that model is hard to interrogate from outside. The counterweight is your own evidence: Montana law requires the department and both boards to consider a qualifying independent appraisal (completed within six months of the valuation date) and to explain any rejection.
And O'Brien turned the owner's books into a mandate: in a case about commercial condominium units, the court held that supplying sufficient, relevant income information obligates the department to value by the income approach — missing mass-appraisal model data is not the statutory test. A rent roll plus a credible cap rate is now the strongest opening move in a Montana income-property appeal.
| Market | 2025 Consolidated Mills | Effective Commercial Rate (top tier) |
|---|---|---|
| Billings (SD2, in city) | ≈ 762 mills | ≈ 1.45% of market value |
| Bozeman (example parcel) | ≈ 560 mills | ≈ 1.06% |
| Below-threshold value (all markets) | — | ≈ 0.84–1.14% (1.5% tier) |
2025 levies; mills vary by school district and city and floated upward in many jurisdictions when the 2025 rate cuts reduced taxable values. The 95 statewide school-equalization mills were confirmed by the Montana Supreme Court in 2023 after 49 counties tried to levy less; the 6 university mills apply statewide, plus a 1.5-mill vo-tech levy in five counties.
The Grounds That Actually Move Bills
A state-run, model-driven system with a stale valuation date rewards owners who bring property-specific evidence the model never saw:
The stale valuation date
Your 2026 value is a January 1, 2024 opinion. Vacancy up, rents down, or cap rates wider since then? The appeal argues what the property was worth on the valuation date — with the benefit of everything the model couldn't foresee.
The O'Brien income mandate
For commercial condominium units, supplying sufficient income information obligates the department to value by the income approach (MCA 15-8-111(5)(b)) — and the court's reasoning that missing model data is not the statutory test gives every income-property owner leverage. Your rent roll is artillery, not context.
The six-month appraisal rule
An independent appraisal meeting Montana standards, completed within six months of the valuation date, must be considered at every level — and any rejection must be explained. Time the appraisal to the cycle and it anchors the record.
Finality across cycles
An unappealed county-board win is final — and binds later cycles unless the property or its circumstances genuinely change. Reappraisal alone doesn't reopen decided issues. One well-fought appeal can hold for years.
The information asymmetry
Montana is a non-disclosure state: sale prices on Realty Transfer Certificates are confidential. The department's comparables are hard to interrogate — but your own purchase price and appraisal are fully admissible. Use the asymmetry; don't suffer it.
One shot, paid under protest
One informal review or appeal per property per cycle — so the filing must carry the case. And while it runs, pay each installment under protest (MCA 15-1-402) to keep every refund dollar recoverable.
Common Questions
Is your value stuck in January 2024?
Send us your classification and appraisal notice — we'll test the department's number against your income, the market since the valuation date, and the O'Brien standard, at no cost. One appeal covers both cycle years.
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