You may need to add additional items of income to your federal adjusted gross income in order to arrive at your Montana adjusted gross income. Complete Form 2, Schedule I to determine the amount of additions to enter.
Recovery of Federal Income Tax Paid in 2017 If you received a federal income tax refund in 2018 from federal taxes you claimed as an itemized deduction on your 2017 Montana tax return, you may need to report a portion or all your federal refund as income on your Montana tax return
Other Recoveries of Amounts Deducted in Earlier Years that Reduced Montana Taxable Income. To the extent that an itemized deduction you claimed on one of your previous Montana returns reduced the amount of your Montana income tax liability, any subsequent refund of the amount deducted is considered income in the year the refund is received
Adjustment for Smaller Federal Estate and Trust Taxable Distribution. The Montana taxable distribution that you received from an estate or trust may be greater than your federal taxable distribution from the same estate or trust. If so, the difference is an addition to Federal Adjusted Gross Income and you report it on this line
Medical Savings Account If you made some nonqualified withdrawals from your account in 2018, report the amount here
First-time Home-Buyer Savings Account Nonqualified Withdrawals If you made nonqualified withdrawals from your account in 2018, report the amount here
Enter any other additions to Federal Adjusted Gross Income not described in lines 1 through 14. Some examples of other additions include:
● You may have a passive or rental loss carryover that is larger for federal purposes than for Montana purposes because of differences in state and federal filings in prior years. If this results in a larger passive or rental income reportable on your Montana tax return, enter the additional amount here.
● You may have a larger capital loss carryover for federal purposes than for Montana. If this results in larger reportable capital gains, enter the additional amount. Note that when computing your Montana Adjusted Gross Income, you can carryover capital losses incurred prior to becoming a Montana resident or losses from activity in another state.