[{"data":1,"prerenderedAt":7},["ShallowReactive",2],{"faq-standard-3796":3},{"rec_id":4,"title":5,"text":6},"3796","What if I paid taxes to another state besides Montana?","If you paid income tax to another state on income that is also taxable to Montana, you may be entitled to a credit against your Montana income tax liability for these income taxes paid to another state. \n\u003Cbr>\u003Cbr>\nBecause Montana has two tax tables, one for Montana ordinary income (income not considered a net long-term capital gain) and another for net long-term capital gains, the credit for income taxes paid to another state must be calculated separately for each type of income. We will calculate the credit(s) for you, based on the information you enter.\n\u003Cbr>\u003Cbr>\nYou can't claim this credit if the other state or country in which you have filed an income tax return has allowed you a credit against the taxes that they have imposed on your net income because you are also subject to tax on the same income in Montana. Income taxes paid to another state or country on income that is derived from sources within Montana do not qualify for this credit.\n\u003Cbr>\u003Cbr>\n\u003Cb>Owners of a pass-through entity (S Corporation or Partnership):\u003C/b>\nIf you are an owner of a pass-through entity and your entity pays an income tax to another state (including composite tax or a pass-through entity tax paid on your behalf) or country, you can claim a credit for your share of these income taxes paid by the entity.\n\u003Cbr>\u003Cbr>\nThe income tax (including composite tax or a pass-through entity tax) paid to another state by the S corporation or partnership must be measured by and imposed on net income. You are not allowed to use other taxes paid by your S corporation or partnership such as, but not limited to, franchise or license taxes or fees that are not imposed on or measured by net income, gross receipt taxes, or gross sales taxes.\n\u003Cbr>\u003Cbr>\nIf your pass-through entity paid an entity level tax in another state and took a federal expense deduction for that tax, you may take this credit. However, you must report your pro-rata share of the state income tax deduction as an addition. Enter this on the \u003Ci>Montana Additions\u003C/i> screen, in the box under the heading \u003Ci>State Income Tax\u003C/i>.\n\u003Cbr>\u003Cbr>\n\u003Cb>Taxes Paid to Another Country\u003C/b>: Individuals are not entitled to a Montana tax credit for taxes paid to a foreign country when they claim a federal foreign tax credit the same year. You can claim a credit for foreign taxes paid to another country if you did not claim the federal \u003Ci>Foreign Tax Credit\u003C/i>, if you do not take the foreign taxes as a deduction on your \u003Ci>Itemized Deductions Schedule\u003C/i>, and if the foreign country does allow a credit for taxes paid to Montana.",1777391539796]