Montana paychecks in 2026: what changed

Montana cut its top income tax rate for 2026.

The changes

• New federal withholding tables. The IRS updated Publication 15-T for 2026, including changes from the 2025 tax law. The standard deduction is $16,100 single, $32,200 married filing jointly, and $24,150 head of household.
• Social Security wage base: $184,500 (up from $176,100). If you earn more, Social Security stops later in the year.
• Tips and overtime deductions for 2025–2028 — see below.
• Top rate down from 5.9% to 5.65%. A 2025 state law also widened the 4.7% bracket to $47,500 for single filers, $71,250 for head of household and $95,000 for married couples filing jointly.
• New MW-4 and tables. Montana allowances are gone; the tables now use the federal standard deduction for your filing status.
• Minimum wage up to $10.85 from $10.55 in 2025.

Tips and overtime in 2026

New federal deductions apply for 2025 through 2028: up to $25,000 for qualified tips, and up to $12,500 ($25,000 for joint filers) for the extra "half" of time-and-a-half overtime. Both phase out above $150,000 of income ($300,000 joint).

These are deductions on your tax return. Your employer still takes Social Security and Medicare out of tips and overtime, and still withholds income tax unless you tell it otherwise. If you expect to claim them, you can put the expected amount in Step 4(b) of your W-4 (and in the Step 4(b) box above) so less income tax is withheld during the year.

Work out your 2026 Montana paycheck →

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Sources

• IRS Publication 15-T (2026), Federal Income Tax Withholding Methods — Worksheet 1A and the annual percentage-method tables
• IRS Publication 15 (2026), Employer's Tax Guide — Social Security and Medicare rates
• Social Security Administration — 2026 wage base of $184,500
• IRS — tips and overtime deductions
• Montana Department of Revenue — Montana Employer and Information Agent Guide with Montana Withholding Tax Tables (V4, November 2025; for use beginning Jan. 1, 2026) — formula tables by payroll period and MW-4 status (4.7% and 5.65%; annual Single $16,100 / $63,600 / $2,233, Married $32,200 / $127,200 / $4,465, Head of household $24,150 / $95,400 / $3,349; both spouses working = Single figures); round to the nearest dollar; worked examples; supplemental flat 5%; deferred-compensation contributions excluded from federal AGI are exempt
• Montana Department of Revenue — Updated Montana wage withholding tables and MW-4 now available (Dec. 8, 2025) — HB 337: top rate 5.9% → 5.65% from Jan. 1, 2026; 4.7% up to $95,000 joint, $71,250 head of household, $47,500 others; no Montana allowances, tables use the federal standard deduction for the filing status
• Montana Department of Revenue — 2026 Montana Publication 1 (September 2025) — 2026 rates: 4.7% on the first $47,500 (single), $95,000 (joint), $71,250 (head of household), 5.65% above; supplemental flat 5%
• Montana Department of Revenue — 2026 Form MW-4, Montana Employee's Withholding and Exemption Certificate (V1 7/2025) — line 1 filing status (single or married filing separately; married filing jointly or qualifying surviving spouse; head of household); line 2 both spouses work with similar pay; line 3 additional withholding; no lines 1 or 2 → withhold as Single
• Montana Department of Revenue — Montana Tax Allowances and Exemptions (Form MW-4) — the federal Form W-4 is no longer accepted for Montana withholding
• Montana Department of Labor & Industry — 2026 Minimum Wage Poster — $10.85 from Jan. 1, 2026; $4.00 for businesses not covered by the FLSA with gross annual sales of $110,000 or less; no tip credit, training wage or meal credit; overtime after 40 hours; pay within 10 business days; final pay
• Montana Department of Labor & Industry — Montana's Minimum Wage — CPI adjustment by Sept. 30 each year; $4.00 for non-FLSA businesses with sales of $110,000 or less; no tip credit, meal credit or training wage
• Montana Department of Labor & Industry — 2025 Minimum Wage Poster — $10.55 from Jan. 1, 2025
• Montana Department of Labor & Industry — Wage and Hour FAQs — paid within 10 business days after the pay period ends; final pay on discharge immediately (4 hours or end of business day) unless a written policy allows next payday or 15 days; quitting: next payday or 15 days; wage claim form; overtime after 40 hours
• Montana Code Annotated § 39-3-207 — Recovery period for wage claims — complaint within 180 days of default; wages for up to 2 years (3 years for repeated violations)