PTE Schedule K-1: Montana Schedule K-1 for Pass-Through Entities (2025)

Who files this form

The pass-through entity must provide a Montana Schedule K-1 to every owner. Owners use it to report their share of income, adjustments, deductions, credits, and other items on their Montana tax returns.

The instructions identify these exceptions and filing requirements:

• If you are an eligible participant in a composite return filed on your behalf by the entity, do not file your own Montana tax return.
• If you are a nonresident individual, estate, or trust, you are not required to file a Montana income tax return when the Part II PTET election box is marked and you have no additional Montana source income.
• If that PTET election box is not marked but Part V, line 1 shows pass-through entity tax, you must file a Montana income tax return.
• If you filed Form PT-AGR, you agreed to timely file a Montana tax return and pay all taxes.

What you'll need

Use these documents and details when reporting your Schedule K-1 information:

• Your Montana Schedule K-1. A federal Schedule K-1 cannot replace it.
• Any additional statement the entity provides for Part V, line 5, if all supplemental information could not fit on the form.
• Credit codes, amounts, and any applicable authorization or identifying numbers for credits you report.
• The instructions for your Montana return, such as Form 2, Form FID-3, or Form CIT, as applicable.

Entities preparing a Montana Schedule K-1 for each owner should refer to the Form PTE instruction booklet.

Common mistakes

• Using only the federal Schedule K-1. It cannot serve as a substitute for Montana Schedule K-1.
• Treating Column B as taxable income for a Montana resident individual, estate, or trust. Parts III and IV, Column B are informational for these owners and relate to the pass-through entity tax election.
• Confusing mineral royalty withholding with production taxes. Part V, line 4 withholding is different from amounts deducted from royalty payments for production taxes.
• Applying Part VI tax credits against composite tax or pass-through entity tax. The instructions say these credits cannot be used against either tax.
• Overlooking an amended Schedule K-1. If you receive one, you may need to amend your Montana tax return to report the changes.

Questions people ask

What does Montana Schedule K-1 show?

It shows an owner's share of Montana source income, gains, losses, deductions, credits, and other items from a pass-through entity.

Where do I report the PTET credit in Part V, line 1?

Individuals report it as a refundable credit on Form 2, line 11c. Estates and trusts report it on Form FID-3, line 13a. Pass-through entities report it on Form PTE, page 3, Flow-Through Payments Schedule, Part I.

What does Part V, line 3c represent?

It is the total Montana income tax withheld on your behalf, combining lines 3a and 3b. Report it as a pass-through withholding credit on your Montana income tax return.

Who is the beneficial owner listed on the form?

This identifies the taxpayer who will claim the reported income on their tax return. For a grantor trust, the grantor's taxpayer identification number is reported here.

Where can I ask questions?

Call (406) 444-6900, or use Montana Relay at 711 for the hearing impaired.

Official sources

• https://revenue.mt.gov/files/Forms/Montana-Schedul-K-1-for-Pass-Through-Entities/2025_Montana_Schedule_K-1_for_Pass-Through_Entities.pdf