The Montana Department of Revenue (MDOR) has changed their water’s edge election process, making the election to cover calendar years 2023, 2024, and 2025 due by March 30, 2023.
The Montana Department of Revenue (MDOR) has changed their water’s edge election process. For those unfamiliar with the Montana water’s edge election, it is fairly unique in that it is a three year binding election that is separate from the filing of the combined corporate income tax return. Thus, it cannot be made on an originally filed return like most other states and the election must be approved by the MDOR in advance of filing the combined corporate income tax return. If an election is not timely filed or not approved, the combined corporate income tax return must be filed under the worldwide combined method.
As of December 1, 2022, filers must request water’s edge election electronically, using the state’s TransAction Portal (TAP).
MDOR issued the following help to get started:
- Access TAP at http://tap.dor.mt.gov
- Under “Business” section, select “View More Options”
- Then select “Submit a Water’s Edge Election”
Filers do not need to create an account to complete this request. The request must be made within the first 90 days of the first period of the three-year period in which the election is to be effective (ARM 42.26.302). Thus, the election to cover calendar years 2023, 2024, and 2025 would be due by March 30, 2023.
Filers may no longer submit Form WE-ELECT via mail, email or fax. Only TransAction Portal submission will be accepted.
Is the water’s edge election right for your company in Montana? Contact your TaxOps advisor for guidance.