Montana Incentives and Laws for Tax Incentives
The list below contains summaries of all Montana incentives and laws related to Tax Incentives.
State Incentives
Ethanol Production Incentive
Montana-based ethanol producers are eligible for a tax incentive of $0.20 per gallon of ethanol produced solely from Montana agricultural products, or ethanol produced from non-Montana agricultural products when Montana products are unavailable. If the producer uses non-Montana based agricultural products, the amount of the tax incentive for each gallon is reduced proportionately, based on the percentage of non-Montana based agricultural or wood products used in production. The tax incentive is available to a facility for the first six years from the date production begins. Ethanol eligible for the incentive must be blended with gasoline for sale as ethanol-blended gasoline in Montana, exported from Montana for sale as ethanol-blended gasoline, or used in the production of ethyl tertiary butyl ether for use in reformulated gasoline. An ethanol producer is not eligible to receive the tax incentive unless the entity uses at least 20% Montana products to produce the ethanol in the first year of production and 25% Montana products in the second year, and the producer must increase the amount of Montana product used each year thereafter by 10%. (Reference Montana Code Annotated 15-70-522)
Biodiesel Blending Tax Credit
Businesses and individuals are eligible for a tax credit of up to 15% of the cost of qualified equipment used for storing or blending biodiesel with petroleum diesel offered for sale. The credit may not exceed $52,500 for a special fuel distributor and $7,500 for an owner or operator of a motor fuel outlet. The credit can be claimed in the two tax years before the year in which the business or individual begins blending biodiesel for fuel or sale. (Reference Montana Code Annotated 15-32-703)
Biodiesel Production Facility Tax Credit
Businesses and individuals are eligible for a tax credit of up to 15% of the cost of constructing and equipping a facility to be used for biodiesel or bio-lubricant production. The producer must claim the credit in the tax year in which the facility begins production, and the facility must be in operation before January 1, 2015. Additionally, a tax credit is available for property used primarily to crush oilseed crops for purposes of biodiesel production. (Reference Montana Code Annotated 15-32-701 and 15-32-702)
Biodiesel Tax Refund
A licensed distributor who pays the special fuel tax on biodiesel may claim a refund equal to $0.02 per gallon of biodiesel sold during the previous quarter if the biodiesel is produced entirely from biodiesel components made in Montana. The owner or operator of a retail motor fuel outlet may claim a refund equal to $0.01 per gallon of biodiesel purchased from a licensed distributor if the biodiesel is created entirely from biodiesel components produced in Montana. (Reference Montana Code Annotated 15-70-369)
Alternative Fuel Vehicle (AFV) Conversion Tax Credit
Businesses or individuals are eligible for an income tax credit of up to 50% of the equipment and labor costs for converting vehicles to operate using alternative fuels. Qualified alternative fuels are compressed and liquefied natural gas, liquefied petroleum gas (propane), hydrogen, electricity, and fuel containing at least 85% ethanol or methanol. The maximum credit is $500 for the conversion of vehicles with a gross vehicle weight rating (GVWR) of 10,000 pounds (lbs.) or less, and $1,000 for vehicles with a GVWR of more than 10,000 lbs. The credit is only available during the year that the business or entity converts the vehicle. An alternative fuel seller may not receive a credit for converting its own vehicles to operate on the alternative fuel they sell. (Reference Montana Code Annotated 15-30-2320)
Alternative Fuel Production Property Tax Incentive
Property tax rate abatements are available for qualified biodiesel, biomass, biogas, and ethanol production facilities. These incentives are available during facility construction and for the first 15 years after the facility begins operation or the related equipment is purchased. The total time of the qualifying period may not exceed 19 years. (Reference Montana Code Annotated 15-24-3111)
Biodiesel Tax Exemption
Biodiesel producers that produce biodiesel from waste vegetable oil feedstock are exempt from the state special fuel tax. (Reference Montana Code Annotated 15-70-301 and 15-70-320)