Montana Mileage and Vehicle Tax Records (2026): Federal Taxable Income, 4.7% and 5.9% Rates, PSC Rideshare Certificates and Automated Driving Systems

General information, not tax or legal advice. Talk to your tax preparer or attorney about your situation.

Montana starts Form 2 from federal taxable income, so a self-employed driver's federal mileage deduction carries over, and 2025 rates are 4.7% and 5.9%. Rideshare companies can get a Public Service Commission Class E certificate for their drivers. A 2025 law allows Level 1 to 3 automated driving systems, with Level 4 and 5 subject to state rules.

Montana now builds its return from federal taxable income, so the federal mileage log does most of the work. This guide covers what the Montana Department of Revenue and the Montana Code Annotated say as of October 16, 2026.

The federal baseline every Montana driver starts from

Most vehicle deductions begin on your federal return. If you're self-employed, you can generally use the standard mileage rate or actual expenses for the business share of your car (IRS Topic 510). For 2026 the business rate is 72.5¢ per mile for January 1 to June 30 (IR-2025-128 / Notice 2026-10) and 76¢ per mile for July 1 to December 31 (IR-2026-29 / Announcement 2026-11) (IRS standard mileage rates). EVs use the same rates; see the 2026 EV mileage rate guide. Most employees can't deduct unreimbursed car expenses federally (Topic 510). IRS Publication 463 asks for each business trip's miles, date, destination and purpose, plus total miles. Commuting stays personal (commuting vs business miles).

How Montana treats vehicle deductions

The 2025 Form 2 instructions start from federal taxable income and then apply Montana adjustments on Schedule I, so a Schedule C vehicle deduction, figured with the standard mileage rate or actual costs, is already reflected. Ordinary income is taxed at 4.7% up to $21,100 of taxable income for single filers ($42,200 married filing jointly) and 5.9% above that.

Depreciation and records

Because Montana starts from federal taxable income, a vehicle's federal depreciation generally carries into the return unless a Schedule I adjustment applies. Ask your preparer about your own situation, especially after large first-year depreciation, and keep the federal Form 4562 and the mileage log behind it. See Form 4562 Part V vehicle records and robotaxi fleet depreciation and Section 179.

Rideshare (TNC) rules in Montana

Montana treats rideshare under its motor carrier law. Under MCA 69-12-340 (enacted in 2015), a Class E motor carrier may not transport people on a public highway without a certificate of compliance from the Public Service Commission. A transportation network carrier may apply for the Class E certificate on behalf of the drivers who use its app, and the statute says the carrier doesn't own, control, operate or manage drivers' vehicles. Whatever the company keeps, save your own trip receipts and annual summaries. See which rideshare miles count.

Robotaxis and automated driving systems in Montana

The Montana Automated Driving Systems Requirement Act (Chapter 355, Laws of 2025) is codified at MCA 61-6-401 and following sections. Under MCA 61-6-409, vehicles with Level 1, 2 and 3 automated driving systems may be used on public highways, and Level 4 and 5 systems may be used subject to limitations set by department rulemaking. Cities may still regulate traffic if they don't discriminate against these vehicles. MCA 61-6-420 lets the Department of Transportation limit commercial vehicles with automated driving systems during dangerous road conditions. Check with the state for current rules on driverless operation. For fleet records, see robotaxi fleet tax basics.

What to keep in your Montana records

Each business trip's date, start, destination, purpose and miles, plus total miles for the year (Pub 463); a weekly log counts as timely kept.
Separate Business, Commute and Personal totals for Form 4562 Part V.
Keep records until the period of limitations runs out, generally 3 years federally (IRS); ask your preparer about the state period.
Keep your federal Form 4562 and Schedule C; Montana starts from the same federal taxable income.
For rideshare: download trip receipts and annual summaries for your federal Schedule C.

For the full list of log fields, see what the IRS asks you to record.

Example: 1,000 hypothetical business miles driven in September 2026 × 76¢ (IR-2026-29) = $760 at the federal standard rate. Miles driven in March 2026 would use 72.5¢ (IR-2025-128) instead, so keep each trip's date. Estimates, not tax advice.

One log for both returns

A Montana return doesn't call for a second mileage log; your preparer works from the same business, commuting and personal miles. CyberDeduct builds a mileage log around IRS Pub 463 from your Tesla's own trip and odometer data (Model S, 3, X, Y and Cybertruck). You connect your Tesla account once through Tesla's standard account sign-in (OAuth); CyberDeduct never sees or stores your password. Home/work rules and route templates label most trips Business, Commute or Personal; you tap to change any label and confirm the purpose. The dashboard shows your business-use percentage and warns you on the 28th if you're under 50%. You export a PDF or CSV log plus a Form 4562 Part V worksheet for your preparer. See how the log is built or see plans.

Sources (checked October 16, 2026)

Frequently asked questions

Does Montana use my federal mileage deduction?

Generally yes for the self-employed. Form 2 starts from federal taxable income, which already reflects Schedule C vehicle expenses.

What are Montana's 2025 income tax rates?

4.7% on ordinary taxable income up to $21,100 for single filers ($42,200 married filing jointly) and 5.9% above that.

Who regulates rideshare companies in Montana?

The Public Service Commission, through Class E certificates of compliance under MCA 69-12-340. A company can apply on behalf of its drivers.

Are self-driving cars legal in Montana?

MCA 61-6-409 allows Level 1 to 3 automated driving systems on public highways; Level 4 and 5 use is subject to limits set by department rulemaking.

Which records should Montana rideshare drivers keep?

A mileage log with each trip's date, miles and business purpose, plus trip receipts and annual summaries from the app.

This article is general information, not tax or legal advice. Talk to your tax preparer or attorney about your situation. State laws and bill status change; check the linked sources for the current text.

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