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Job Growth Incentive Tax Credit (MT)

H.B. 629 was approved by the Montana legislature on May 14, 2021. Part of this bill included the Job Growth Incentive Tax Credit.

This credit was created to encourage the growth of high-paying Montana-based jobs. It is a nonrefundable credit equal to 50% of the Montana FICA taxes paid by the employer on new wages multiplied by the number of qualifying employees certified by the state each year.

This credit can be claimed by employers for up to seven years, beginning in 2022. The bill states that after 10 years any remaining credit may not be refunded or credited to the taxpayer.

To illustrate, an employer with $1.5 million in total new wages and 30 new employees would withhold a total of $114,750 in FICA taxes (7.65% of Montana wages). Only 50% of the withholding would be eligible for the credit ($57,375). The 50% of FICA related to the 30 new employees is worth $57,375 of credit per year for a total credit of $402,745 over the seven years in which the credit may be claimed.

Each rule below must be met in order to qualify for the credit. If you believe you qualify then contact us today to get the process started!

  • Employer must have hired at least five new employees in 2022, worked more than six months in 2022 and have a wage over $50,000 per year.

  • Employer hired the employees who specifically worked on a Montana based project. Specifically, this project must encourage, promote, and stimulates economic development in the sectors of construction, natural resources, mining, agriculture, forestry, manufacturing, transportation, utilities, or outdoor recreation.

  • Employer hired more qualifying new employees in 2022 than the level of full time equivalent employees in 2021. This figure has to be at least five if this is the first time claiming the credit or at least 10 in counties with over 20,000 population.

For more information you can visit, read the H.B. 629, or contact us today!

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