Second homes and cabins: the four options
This is a decision rather than a filing. Three of the four options require changing something real about how you use the place, and the fourth is to pay a holding cost that has roughly two-and-a-half-timed.
The short version
There is no relief program for a second home as such. Every reduced rate in Title 15 attaches to a principal residence or a long-term rental, so a cabin you keep for yourself sits at 1.9%.
That leaves four options, and three of them require changing something real about how you use the place. This is a decision, not a filing.
HB 231 drew a deliberate line. Owner-occupied homes got a reduced rate; second homes, cabins and short-term rentals were left at the default. That was the policy, not an oversight, which is why there is no form that fixes it and no argument that a second home was misclassified. It was classified exactly as intended.
What it costs to do nothing
On a $400,000 cabin, in taxable value:
| Situation | Rate | Taxable value |
|---|---|---|
| 2025, before the change | 0.76% | $3,040 |
| 2026, kept as a second home | 1.9% | $7,600 |
| 2026, qualifying as a long-term rental | 0.77% | $3,060 |
The gap between the second and third rows — $4,540 of taxable value — is what the decision below is worth each year, multiplied by your local mills.
The four options
1. Pay it
Entirely reasonable, and for a cabin you use in the season you care about it is often the right answer. What has changed is the size of the number: the holding cost on a second home is now roughly two and a half times what it was, so it deserves a line in the budget rather than an assumption. If the place is appreciating faster than that cost, the arithmetic still works.
2. Convert it to a qualifying long-term rental
The rental claim is available to a second home, and it reaches the same graduated bands as the homestead — starting at 0.76%, not a flat rate. On a cabin below the $386,000 median it restores the old rate exactly. The bands, and why the commonly quoted figure is too high.
The tests are real, though: tenancies of 28 days or more, for at least 7 months of the year you are claiming. A weekly-turnover rental fails even with a full calendar.
3. Make it your principal residence
Live there at least seven months a year and it becomes eligible for the homestead rate — but only one principal residence per owner, so this trades the claim on wherever you live now. It is a genuine option for people already spending most of the year at the lake and claiming nothing, and a non-option for everyone else.
4. Sell
Worth naming rather than pretending it is not on the list. A holding cost that has more than doubled changes the maths on a property that was already marginal — particularly one being held for a future use that keeps receding.
The option most people miss: a seasonal lease
The rental test is seven months, not twelve. That leaves five months of the year free, and the statute permits up to five months of vacancy for documented repairs on top of the arithmetic — MCA 15-6-402.
For a cabin you want in July and August, an off-season lease from September through March is seven months, qualifies on its face, and leaves the season you actually care about intact. Whether it is achievable depends entirely on your local rental market — a ski town and a lake an hour from nowhere are different propositions — and on whether you want tenants at all.
Before planning a conversion, settle one open question
The application under MCA 15-6-411 asks for the preceding year’s income and expenses, including the rent charged each month. Eligibility under MCA 15-6-402, on the other hand, is measured in the year being claimed. A cabin that has never been rented has no preceding-year figures to report.
If the department reads the prior-year information as a hard gate, the first saving lands a full year later than you might plan for. Options include calling the department field office and settling it before you sign a lease term around it.
Entity-owned cabins
If the place is held in an LLC, a corporation or an irrevocable trust, option 3 disappears — MCA 15-6-405 makes entity-owned residential property ineligible for the homestead rate no matter who lives there. The rental claim, though, is fully available to an entity. For entity-held cabins the list is really three options, and the rental route is the only one that reduces the rate.
The deadline, if you are going to do something
The window for the 2027 tax year is open now and closes March 1, 2027. A claim filed by then reduces the 2027 taxable value and shows up on the bill in the fall of 2027 — a conversion decided in the spring pays off eighteen months later, which is exactly why it is worth deciding early rather than when the next bill lands.
Related
- The 28-day test that disqualifies short-term rentals
Montana's long-term rental reduced rate requires tenancies of 28 days or more, for at least 7 months of the claimed year. A property booked solid every week of the year fails. The question is not whether it is rented — it is whether any tenancy ran under 28 days.
- The long-term rental rate is not 1.1%
Nearly every summary calls Montana's long-term rental reduced rate a flat 1.1%. The statute gives a qualifying rental the same graduated bands as a homestead, starting at 0.76% — and the flat rate applies to multifamily units only.
- Vacant land: why no reduced rate exists, in any year
Both Montana reduced rates require a dwelling, so a vacant residential lot qualifies for neither in 2026 or any future year. The honest answer — plus the one lever that does exist for bare ground, which is classification, and which has no deadline.
Where your own parcel stands
The rate check is free and takes about ten seconds — look up any Montana property and see which rate applies, which reduced rate it could qualify for, and the gap between them. No email required. If you would rather someone went through the whole notice, that is what we do.
Rates, deadlines and statutory citations verified against MCA Title 15 as of September 17, 2026. The median residential value ($386,000) and median commercial value ($379,000) are recalculated every two years with reappraisal — the next reset is in 2027. Up The Creek Research LLC is a public-records research firm, not a law firm, an accounting firm or an appraisal firm; this page explains what the statute provides and is not advice about your particular situation. See our Disclaimer & Terms.