Taxes Applicable When Selling A Farm In Montana

1. Taxes Applicable When Selling A Farm In Montana

2. Some taxes should not be overlooked at any cost when selling a farm in Montana. The taxes are usually determined by the allocation of sales prices of the overall farm or ranch, including the assets. Here are the applicable taxes that can be deferred by professional guidance.

3. Depreciation Recapture – 25 percent of the profit acquired by selling depreciable capital property

4. Federal Ordinary Income Tax – 39.6 percent of the taxable income

5. Federal Capital Gain Tax – 15 to 20 percent of economic gains

6. State Taxes – applicable state tax varies from state to state. Montana residents have to pay 6.9 percent tax.   

7. New Medicare Surtax – 3.8 percent Medicare Surtax is applicable to the net investment income.

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