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42.17.602    CLAIMING THE CREDIT FOR TAX WITHHELD

(1) Claiming credit for the tax withheld shall be accomplished as follows:

(a) Credit may be claimed for the tax withheld on a Montana Individual Income Tax Return or a Montana Corporation License Tax Return.

(b) Taxpayers who are shareholders in a corporation taxed under Subchapter S of the Internal Revenue Code doing business in this state must maintain a copy of federal form K-1. They may claim credit for the amount shown as their percentage share of the tax withheld from Montana net royalty payments by the corporation, limited liability company, or partnership.

(c) An estate or trust is entitled to credit for the tax withheld in proportion to its share of federal distributable net income. The remaining credit must be passed through to the beneficiaries in proportion to their respective shares of federal distributable net income of the estate or trust. To claim the credit, the beneficiaries must maintain a copy of federal form K-1 and claim credit for the amount shown by the fiduciary as their percentage share of the tax withheld from Montana mineral production payments.

(d) Any person filing on a fiscal year ending other than December 31 must claim a credit for the withholding tax shown on the personal income tax return required to be filed during the year following the December closing period of the Montana Mineral Royalty Withholding Tax Reconciliation Return (form RW-3).

History: 15-30-272, MCA; IMP, 15-30-264, MCA; NEW, 2007 MAR p. 2151, Eff. 12/21/07.

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