Montana is one of the few states in the U.S. without a statewide sales tax, a fact that draws many entrepreneurs to set up shop under the Big Sky. But while the state keeps things simple, some resort communities rely on local resort taxes to help cover the cost of tourism and infrastructure. If your business operates in one of these destinations, you’ll need to understand how resort tax works, how to file, and how to stay compliant through busy seasons (and quiet ones). This guide walks you through everything you need to know to manage Montana resort tax with confidence.
Does Montana have sales tax?
Montana is one of the few states that does not have a statewide sales tax, making it an appealing place for many businesses to set up shop. However, it’s important for business owners to know that some local resort areas, including places like Big Sky, Red Lodge, and West Yellowstone, may impose a local option tax on certain goods and services. So while most of the state enjoys a tax-free advantage, be sure to check if your business operates in a location with local tax requirements. For more information, visit the Montana Department of Revenue’s website on taxes.
What is the sales tax in Montana?
Montana’s statewide sales tax rate is 0%, making it one of the few states without a general sales tax. However, certain communities that meet specific resort qualifications may impose a local resort tax to help support local infrastructure and services.
The maximum resort tax rate is 3%, and it can be implemented in incorporated towns with populations under 5,500 or unincorporated areas with fewer than 2,500 residents that attract a high number of visitors. These taxes allow resort communities to manage the additional strain on local resources caused by tourism without placing the financial burden on residents.
The resort tax may apply to the retail sale of:
- Lodging and camping accommodations such as hotels, motels, and campgrounds
- Restaurants, fast food outlets, and other food service establishments
- Taverns, bars, and lounges serving alcoholic beverages
- Destination ski resorts or other recreational facilities
- Luxuries sold within the resort area
A few local communities will also charge a 1% infrastructure tax on top of the resort tax, increasing the total rate to 4%. For more details and a full list of participating resort communities, visit the Montana Department of Revenue’s Local Resort Tax page.
How to calculate sales tax in Montana?
If your business operates in one of Montana’s resort communities, calculating the resort tax works much like calculating a traditional sales tax, just at the local level. The tax is applied as a percentage of the retail value of taxable goods and services, such as lodging, restaurant meals, alcoholic beverages, and certain luxuries.
To find the total amount to collect, multiply the price of your taxable sale by your community’s tax rate (which can be 3% or up to 4%). The resulting amount is what you’ll collect and later remit to your local government.
Use our sales tax calculator
If you need to determine how much tax was included in a total sale price, try using our reverse sales tax calculator. It’s an easy way to back out the tax portion from the total amount, especially helpful for restaurant owners or lodging businesses that regularly deal with mixed-tax transactions.
How to register for a Montana sales tax license?
If your business operates in a community that charges a local resort tax, you’ll need to register directly with that community before collecting and remitting the tax. Each community handles registration a little differently, but the general process is fairly similar.
For example, in Red Lodge, all businesses operating within city limits must obtain a business registration certificate and pay a registration fee. Registrations are due each year by July 1 and are valid through June 30. Businesses selling taxable items under the city’s resort tax ordinance must also post a $500 bond, cash deposit, or irrevocable letter of credit to guarantee compliance with local resort tax rules. The city doesn’t have an online portal, but they do provide an application form that can be submitted electronically or mailed directly to the city.
In Big Sky, registration is simpler and free. Businesses can register online through the MUNIRevs portal, which takes about 1–3 business days to process. Once approved, you’ll receive an email confirmation and instructions to print your registration certificate. The MUNIRevs portal is also where you’ll file and pay your resort tax returns going forward.
If you’re unsure about your local requirements, it’s best to check with your city or town government before starting operations. Doing so ensures your business is compliant and ready to collect resort tax correctly from day one.
How to file a sales tax return in Montana?
Since Montana does not impose a statewide sales tax, there’s no state-level sales tax return to file. However, if your business operates in a community that charges a local resort tax, you are responsible for filing a resort tax return directly with that jurisdiction. Filing processes vary by location, so always follow the instructions provided by the community where you do business.
Here’s an example of how filing works in two popular resort tax communities:
- Red Lodge: Businesses can file returns and make payments online through the City of Red Lodge’s website on the Resort Tax page. If you prefer to submit by mail, you can print the transmittal form and mail it with a check to the City of Red Lodge, PO Box 9, Red Lodge, MT 59068.
- Big Sky: For this resort community, all filing and payments are completed through the MUNIRevs portal. Once registered, you’ll see the periods available to file and can submit payment electronically. For more details on how to collect tax in Big Sky, refer to their Collections page.
No matter where your business is located, you must file a return for every reporting period, even if you didn’t collect any resort tax. This is called filing a “zero return,” and failing to do so can result in penalties. Since each resort community sets its own filing rules, forms, and portal access, always check the local government’s official website to ensure you’re compliant.
How to pay Montana sales tax?
Just like filing, resort tax payments are made directly to the local community that imposes the tax. How you pay will depend on where your business operates.
In Red Lodge, if you file online, you’ll be prompted to submit your payment at the end of the return process. The system allows you to pay using a credit card, debit card, or a personal or corporate check. If you prefer to mail your return, you must include a check with it. Checks should be made payable to The City of Red Lodge.
In Big Sky, payments are submitted through the MUNIRevs online portal. You can pay by ACH debit (also known as an e-check) or by major credit cards (Mastercard or Visa). It’s worth noting that the portal does not store payment information, so you’ll need to enter your details each time you file a return.
Because every resort community manages its own tax system, it’s important to always double-check payment requirements with the local jurisdiction to ensure compliance.
Make your sales tax less taxing with DAVO.
When is Montana sales tax payment due?
Since Montana does not administer resort taxes at the state level, each community sets its own filing schedule and due dates. If your business operates in one of these resort communities, it’s essential to follow their specific rules to stay compliant.
In Red Lodge, resort tax returns are filed quarterly. Payments and filings are due on April 20, July 20, October 20, and January 20 for the previous quarter’s activity. If a due date falls on a weekend or holiday, filing is due the next business day.
In Big Sky, payments are due on the last day of the month following the period in which the tax was collected. Filing frequency is based on how much resort tax your business collects each year:
- Monthly filing for businesses collecting $5,000 or more annually. Returns are due by the last day of the month following the month in which tax was collected.
- Quarterly filing for businesses collecting less than $5,000 annually, due by the last day of the month after the quarter ends.
- Seasonal filing may be approved for businesses operating 4 months or fewer each year and collecting under $5,000. Filing schedules must be reviewed and approved by the district.
A friendly note for long-standing businesses in Big Sky, paper payments or forms submitted by mail or dropped off at First Security Bank incur a $25 processing fee, another good reason to file electronically.
Resort tax collection allowance
In some districts, businesses may keep a percentage of their resort tax liability as an administrative fee to offset the effort of collecting and remitting the tax. For example, in Big Sky, businesses can keep 5% of the resort tax collected for reporting and remitting on time. The portal will automatically prompt you through this step when you file. If you operate in multiple states, discover where else you can get a sales tax discount with our vendor compensation guide. With DAVO, this collection allowance is returned to the business in full, sometimes covering the full subscription cost to DAVO.
What are the penalties?
While Montana doesn’t impose a statewide sales tax, resort communities enforce their local resort tax seriously, and penalties add up quickly when deadlines are missed.
In Red Lodge, daily interest begins accruing immediately at a rate of 0.000493 of the tax owed for every day a return or payment is overdue (around 1.5% per month). If a balance remains unpaid 30 days past the deadline, the city issues a $250 penalty. At 60 days late, that penalty increases to $750. In the most extreme cases where a business continues to ignore notices and obligations, the city may pursue criminal enforcement, which can include up to $1,000 in fines, six months of imprisonment, or both. While rare, this underscores how important timely filing is in smaller resort communities that rely heavily on these funds.
In Big Sky, overdue resort tax also triggers interest and fees. Interest is charged at 12% annually, or 1% for each month the payment remains late, growing month by month until resolved. There is a short grace period during the first five days after the due date, but past that point, a monthly late fee is assessed. The fee starts at $30 once you are more than five days late, and gradually increases as more months pass, reaching a maximum of $150 if the tax remains unpaid for five months or longer.
Montana resort towns depend on this revenue to support local infrastructure and visitor services. Staying compliant helps ensure your business maintains a positive relationship with the community and avoids unnecessary costs down the road.
How DAVO can help with Montana resort tax
Operating a business in one of Montana’s resort communities comes with a unique rhythm, bustling visitor seasons, slower shoulder months, and the juggling act of keeping operations running smoothly in between. Resort taxes are just one more thing on your plate, but they play a vital role in supporting the very attractions that draw customers through your doors.
DAVO helps remove that stress. Once connected to your point-of-sale system, DAVO automatically sets aside the resort tax from every transaction daily, in real time, so those funds are protected and always ready when filing time arrives. Whether your business is in Red Lodge, Big Sky, or another resort-designated town, DAVO ensures your resort tax is filed and paid on time, every time, guaranteed.
No scrambling to meet quarterly deadlines. No surprises when payments are due. No late fees eating into seasonal revenue.
While Montana may not have a statewide sales tax, local resort taxes are essential for keeping roads plowed, trails maintained, and mountain towns welcoming to both residents and visitors. DAVO helps you stay in compliance and stay focused so you can continue delivering the experiences that make Montana special.
Choose your POS system to get started with DAVO.
Montana Department of Revenue Information:
406) 444-6900
