Montana homeowners who should have received the new homestead property tax rate this year but didn’t will get a chance to recover the difference, though not until after the new year.
The Montana Department of Revenue announced on Oct. 22 that it will accept requests for a 2026 Property Tax Refund from Jan. 1 through May 31, 2027. The refund is meant for people who lived in their homes as a principal residence and met every requirement for the homestead reduced tax rate, but never enrolled. It also covers buyers who closed on a home after the application deadline and otherwise qualified.
The refund equals the gap between what the owner paid under the regular residential rate and what they would have paid at the homestead rate, for 2026 only, under Section 15-6-407 of state law.
How much is at stake
The homestead rate came out of the property tax overhaul lawmakers passed in 2025, which split residential property into tiers and lowered rates for owner-occupied homes. For 2026, according to the department’s tax information page, a qualifying primary residence is taxed at 0.76% on the first $378,000 of market value, 0.90% from $378,001 to $756,000, 1.10% from $756,001 to $1,511,999, and 1.90% above $1,512,000. Second homes and short-term rentals that don’t qualify are taxed at a flat 1.90%.
On a typical Montana house, that spread can add up to hundreds of dollars or more in a single year, depending on local mill levies. A homeowner who missed enrollment paid the higher rate on the full value.
Who qualifies
According to the refund page, a request has to meet all of these conditions:
- The home was owned in 2026 by one or more individuals or by a grantor revocable trust. Property held by an LLC, a corporation or an irrevocable trust does not qualify.
- The owner lived there as a principal residence for at least seven months of 2026.
- All 2026 and prior-year property taxes on the property have been paid.
Rentals and second homes are not eligible. Neither is anyone whose property already received the reduced rate this year. The refund is a one-time correction for 2026; it does not reach back to earlier tax years, and it is not a separate rebate program like the income-tax and property-tax rebates the state paid in 2023 and 2024.
Check now, file in January
The department is asking homeowners to look up their enrollment status before Jan. 1. If the 2026 bill already reflects the homestead rate, there is nothing more to do. If it doesn’t, the department suggests enrolling now for the 2027 rate, which is open through March 1, 2027, and then returning in January to request the 2026 refund.
Requests are filed online through the department’s TransAction Portal. Applicants will need the Social Security number of each owner, the property’s geocode, which appears on the tax bill and the assessment notice, plus contact information and a mailing address for the check. The department says it verifies payment with the county treasurer before approving a request, and refund checks are mailed within about 30 days of approval. Homeowners whose refunds are approved are automatically enrolled for the 2027 homestead rate.
Property tax bills went out across the state this fall, with first-half payments due by Nov. 30 in most counties. The refund does not change that deadline. Taxes have to be paid in full for a refund request to be approved, so a homeowner who skips the November payment while waiting on a refund would disqualify themselves.
Questions go to the Department of Revenue at (406) 444-6900. The department has also posted a set of homestead rate FAQs answering common questions about eligibility and enrollment.