Unemployment Insurance Law Summaries
Montana, Unemployment Insurance Law Summaries
Montana's unemployment insurance law is located in the Revised Codes of Montana, 1978, Title 39, Chapter 51, Volume 7, as amended, Secs. 39-51-101 to 39-51-3207; and in the Rules of the Employment Security Division of Montana, Rules 24.11.101 to 24.11.1006. The full text of the law is available at Unemployment Insurance Reports UI-MT ¶4100 .
DEFINITIONS
“Employer” whose total annual payroll in either current or preceding calendar year equals or exceeds $1,000. Generally, an employer subject to the FUTA is automatically subject to the Montana law.
Employment.- Service by an individual, by a manager or member of a manager-managed limited liability company that has filed with the Secretary of State, or by an officer of a corporation performed for wages or under any contract of hire, written or oral, express or implied, with exceptions listed below. Service performed by an individual for wages, unless and until it is shown that the individual is an independent contractor.
Service performed for wages constitutes employment unless and until it is shown that the individual is:
free from control or direction; and
customarily engaged in independently established trade, occupation, profession or business.
Employees of national banks organized under the National Banking Law are covered. An individual found to be an independent contractor under the Montana Workers' Compensation Law is an independent contractor under the UI law.
“Wages:” Remuneration payable for personal services, including commissions, bonuses, cash value of all remuneration payable in any medium other than cash and back pay received pursuant to a dispute related to employment. Continuing wages received by an employee from his or her employer during sickness are wages, unless paid from a fund for sickness or accident benefits or made under a workers' compensation law. Gratuities customarily received by an individual in the course of employment from persons other than the employer are wages. The term wages does not include:
Annually determined amount equal to the greater of 80% of the average annual wage (rounded to nearest $100) during the calendar year immediately preceding most recently completed calendar year, or the federal taxable wage base. The taxable wage base for 2009 is $25,100. Wages paid by employer's predecessor may be included in determination of wage base.
Other exceptions from wages are listed below.
COVERAGE
Service performed for wages constitutes employment unless and until it is shown that the individual is:
free from control or direction; and
customarily engaged in independently established trade, occupation, profession or business.
Employees of national banks organized under the National Banking Law are covered. An individual found to be an independent contractor under the Montana Workers' Compensation Law is an independent contractor under the UI law.
Exceptions from coverage are listed below.
Agricultural and domestic employers.- Service performed in agricultural labor for an employer who employs 10 or more individuals in such service on 20 days in 20 different weeks in the current or preceding calendar year or pays at least $20,000 for such service in any quarter of the current or preceding calendar year is covered.
If an employer is otherwise subject to the law and has agricultural employment, all agricultural employment, all agricultural employees must be excluded from coverage if the employer meets neither of the above tests relating to the monetary amount or number of employees and days worked and keeps separate books and records to account for the employment of persons in agricultural labor.
If agricultural labor is supplied by a crew leader, the employing unit for which the service is performed is the employer of the crew members unless the crew leader is registered under the Seasonal Agricultural Worker Protection Act, or substantially all of the crew members operate or maintain certain equipment that is provided by the crew leader. In either of these instances, the crew leader is the employer.
Domestic service.- Domestic and household service in a private home, local college club or local chapter of a college fraternity or sorority is covered if performed by an employing unit that paid $1,000 or more for such service in any quarter of the current or preceding calendar year. If an employer is otherwise subject to the law and has domestic service employment, all domestic employees must be excluded from coverage if the employer does not meet the monetary payment test set out above and keeps separate books and records to account for the employment of persons in domestic service.
Government and nonprofit employers.- Mandatory coverage is required with respect to services performed for nonprofit organizations exempt from federal income tax and for most services performed by the state, including services for the state university, state colleges or public schools, government units and political subdivisions.
Nonprofit organizations, Indian tribal units, and government entities may finance the payment of benefits by either regular contributions or the reimbursement method. State and political subdivisions may also elect to make payments in lieu of contributions or to pay under a special contributions plan for governmental entities only, under which rates are based on benefit cost experience. Under this plan, no rate may be less than 0.1% or more than 1.5%.
Employers using reimbursement financing must make payments equal to the full amount of regular benefits plus the state's share (full amount for governmental entities) of extended benefits paid to claimants.
EXCEPTIONS
Wages.- The term wages does not include:
Annually determined amount equal to the greater of 80% of the average annual wage (rounded to nearest $100) during the calendar year immediately preceding most recently completed calendar year, or the federal taxable wage base. The wage base for 2009 is $25,100. Wages paid by employer's predecessor may be included in determination of wage base.
Payments made by an employer under a plan established for the employees in general or for a specific class or classes of employees for retirement, sickness or accident disability paid under a workers' compensation law, medical and hospitalization expenses, or death.
Employee expense reimbursements or allowances for meals, lodging, travel, subsistence or other expenses.
Employment.- The term employment does not include the following:
Casual labor not in the course of an employer's trade or business performed in any calendar quarter, unless the cash remuneration paid for such service is $50 or more and such service is not performed by an individual who is regularly employed by such employer.
Cosmetologists and barbers who are free from direction and control of contract owner, receive payment from their own clients, and whose contracts show that they are not covered by the UI law.
Direct sellers, as defined under the Internal Revenue Code.
Installers of floor coverings if the installer bids or negotiates a contract price based on work performed by the year or by the job, is paid upon completion of a portion or all of the job, may perform services for anyone, may accept or reject any job, furnishes substantially all tools and equipment needed, and works under a written contract that specifies certain conditions.
Election judges if the remuneration received for such services is less than $1,000 in a calendar year.
Insurance salespeople paid commissions only and without minimum guarantee.
Maritime employees.
Newspaper carrier or freelance correspondent if the person performing the services (or a parent or guardian of such person in the case of a minor) has acknowledged in writing that the person and the services are not covered.
Petroleum land professionals who negotiate the acquisition or divestiture of mineral rights and agreements for the exploration or development of minerals, if such services are remunerated on a contractual rather than hourly basis.
Real estate salespeople paid commissions only and without minimum guarantee.
Relatives, i.e., service performed by a dependent member of a sole proprietor for whom an exemption may be claimed and service performed by a sole proprietor's spouse for whom an exemption based on marital status may be claimed by the sole proprietor.
Securities salespeople paid commissions only and without minimum guarantee.
Service covered by federal unemployment compensation system.
Service by student enrolled at a nonprofit or public educational institution in full-time work study program. Exemption not applicable if service performed under program established for an employer or group of employers.
Service for a hospital by a patient of the hospital.
Service for school, college or university performed by student in regular attendance, or spouse of that student if spouse's employment is under program of assistance to the student.
Services by elected officials of the state.
Sole proprietors, working members of a partnership, or members of a member-managed limited liability company that has filed with the Secretary of State.
Officials at amateur athletic events.
Agricultural and domestic employers.- Service performed in agricultural labor for an employer who employs 10 or more individuals in such service on 20 days in 20 different weeks in the current or preceding calendar year or pays at least $20,000 for such service in any quarter of the current or preceding calendar year is covered. If an employer is otherwise subject to the law and has agricultural employment, all agricultural employees must be excluded from coverage if the employer meets neither of the above tests relating to the monetary amount or number of employees and days worked and keeps separate books and records to account for the employment of persons in agricultural labor.
Domestic service.- Domestic and household service in a private home, local college club or local chapter of a college fraternity or sorority is covered if performed by an employing unit that paid $1,000 or more for such service in any quarter of the current or preceding calendar year. If an employer is otherwise subject to the law and has domestic service employment, all domestic employees must be excluded from coverage if the employer does not meet the monetary payment test set out above and keeps separate books and records to account for the employment of persons in domestic service.
Government and nonprofit employers.- Services for a nonprofit organization do not include the following (political subdivisions may also exclude these services):
Church or organization operated for religious purposes and which is controlled by a church.
Religious duties of a minister or member of a religious order.
Patients performing services in a rehabilitation facility or sheltered workshop.
Individual receiving unemployment work-relief or work-training under program financed by federal agency or agency of a state or political subdivision.
Inmate performing services for state prison or other state correctional or custodial institution.
PROCEDURES
Base period.- First four of the last five completed calendar quarters preceding benefit year, except that the base period of a claimant who fails to qualify due to temporary total disability is the first four of the last five quarters preceding the disability if a claim is filed within 24 months of date on which claimant's disability was incurred.
Benefit year.- 52-consecutive-week period beginning with first day of week in which claimant files valid claim; except that the benefit year will be 53 weeks if filing a new valid claim would result in overlapping any quarter of the base year of a previously filed new claim. A subsequent benefit year may not be established until the expiration of the current benefit year.
Weekly benefit amount.- Amount equal to 1% of total base period wages or 1.9% of total wages paid in two highest base-period quarters. When Schedule II or higher is in effect, weekly benefit amount are subject to a minimum determined as 19% of the average weekly wage and to a maximum determined as 66.5% of average weekly wage. When Schedule I is in effect, weekly benefit amounts are subject to a minimum determined as 20% of the average weekly wage and to a maximum determined as 67.5% of average weekly wage. Effective July 1, 2008, minimum is $120 and maximum is $407. These amounts are based on an average weekly wage of $604.35.
Partial benefits equal to the claimant's weekly benefit amount less 50% of wages earned in excess of
of the weekly benefit amount, rounded to nearest lower multiple of $1, are payable.
Although benefit payments are not assignable, deductions may be made to repay food stamp overissuances and child support obligations. In addition, a claimant may elect to have income taxes voluntarily withheld from his or her benefit payments (Secs. 39-51-2206 and 39-51-2207).
Maximum total benefits.- Total benefits equal to the individual's weekly benefit amount times the number of full weeks of benefit entitlement (up to 26) appearing in following table on the line that includes the individual's ratio of total base period earnings to high-quarter earnings:
Ratio of Total Base Period
Earnings to High Quarter
|
Full Weeks
of Benefits
|
|---|
At least
|
But Less than
|
|---|
1.00
|
1.25
|
8
|
1.25
|
1.50
|
10
|
1.50
|
1.75
|
12
|
1.75
|
2.00
|
14
|
2.00
|
2.25
|
16
|
2.25
|
2.50
|
18
|
2.50
|
2.75
|
20
|
2.75
|
3.00
|
22
|
3.00
|
3.25
|
24
|
3.25
|
3.50
|
26
|
3.50
|
-
|
28
|
During periods of high unemployment, payment of extended benefits at claimant's regular weekly benefit rate.
Benefit eligibility: Requirements-
total base period wages of (a) not less than 1 1/2 times high-quarter wages, but at least 7% of the average annual wage, or (b) 50% of the average annual wage;
able and available for work and seeking work, except claimant will not be deemed unable or unavailable due to illness or disability occurring after registration for work, provided no suitable work offered after beginning of illness or disability;
serve one-week waiting period. Claimant may earn up to twice his or her weekly benefit amount and work up to 12 hours per week and still qualify as totally unemployed;
participates in reemployment services under a worker profiling system, if required to do so.
To be eligible for benefits in a second benefit year, services for remuneration in covered employment must have been performed during the previous benefit year and the claimant must have earned the lesser of
of his or her high-quarter wages in the second benefit year or six times the weekly benefit amount for that same year.
No benefits may be paid to instructors, researchers, or principal administrators of an educational institution during school vacation periods or paid sabbatical leaves based on services with such institution if there is a contract or reasonable assurance that the individual will perform the services after the vacation or sabbatical leave.
No benefits may be paid to nonprofessional employees of an educational institution during school vacations based on services with such institution if there is a reasonable assurance that the individual will perform such services after the vacation. If the individual is not offered work after the vacation period, he or she may claim retroactive payments of benefits.
The disqualifications in the above two situations also apply to an individual performing services in an educational institution while in the employ of an educational service agency.
Benefits are not payable to a professional athlete for any period between two sport seasons if there is a reasonable assurance that the individual will return for the second such season.
Benefits are not payable to an alien unless that individual has been admitted for permanent residence, is lawfully present for the purposes of performing services, or is otherwise permanently residing within the United States under color of law.
Notwithstanding availability requirement (see above) and failure to apply for or accept suitable work (see below), no benefits may be denied individual in approved training.
Disqualifications-Period.- A disqualification may not be confined to a single benefit year (Sec. 39-51-2301).
Leaving work without good cause attributable to employment-until an individual has performed services (in employment, as defined by law) for which remuneration is received equal to at least six times his or her weekly benefit amount subsequent to the week in which the disqualifying act occurred. Such disqualification does not apply where leaving is the result of illness or injury not associated with misconduct upon advice of physician and, after recovery, returned to employer and offered to return to regular or suitable job that was not available; or if the individual leaves temporary work accepted during a period of unemployment caused by a lack of work with the regular employer if, upon leaving the temporary work, the individual returned immediately to work for the regular employer, provided that the unemployment was for nondisqualifying reasons; or if the individual has been in regular attendance at an educational institution accredited by the state for at least three consecutive months from the date of enrollment; or if the voluntary quit (or discharge) was the result of domestic violence toward either the claimant or his or her child, subject to certain conditions (Sec. 39-51-2302).
Misconduct connected with work-until the individual has performed services (in employment, as defined by law) for which remuneration is received equal to at least eight times his or her weekly benefit amount subsequent to the week in which the act causing disqualification occurred.
Gross misconduct connected with work or committed on the employer's premises-52 weeks.
Failure to apply for or accept suitable work-week in which failure occurs and until the individual has performed services for which remuneration of at least six times his or her weekly benefit amount is received, plus six weeks' reduction in maximum benefits.
Labor dispute-duration.
Receipt of railroad unemployment benefits or unemployment benefits under other state or federal law-week for which received.
Payments under the Workers' Compensation Law or the Occupational Disease Law of any state or under a similar law of the United States or under the social security disability law-week for which received. Claimant may receive unemployment benefits if no longer drawing workers' compensation and otherwise qualified. Workers' compensation received for permanent partial disability must not be spread over period of weeks in advance to bar payment of unemployment benefits.
Students regularly attending established educational institutions-during school year (within autumn, winter, and spring seasons), or during vacation periods within such school year or during any prescribed school term.
An individual attending an adult basic education class for 20 or fewer hours per week while laid off is not disqualified from benefits.
Receipt of governmental or other pension, retirement pay, annuity or other similar period payment-weekly benefit amount reduced (but not below zero) by the amount of such payment if the payment is made under a plan maintained or contributed to by a base period or chargeable employer and, except in the case of payments made under the Social Security Act or the Railroad Retirement Act, the services performed for the employer after the beginning of the base period or the remuneration for services affect eligibility for or the amount of the payment. No reduction applies if the payment is made from a fund to which the individual was required to make a direct contribution.
False statement or willful nondisclosures-not more than 52 weeks.
WHAT THE EMPLOYER MUST DO
Pay the standard rate.- Depends on industrial classification (see below). Maximum possible rate is 6.37% (6.5% including 0.13% administrative fund tax). No employee tax.
Experience rates.- Rates are assigned on a calendar year basis. New employers pay rates equal to the average rate of contributions paid by employers in the same major industrial classification, plus an adjustment for the difference between the average tax rate assigned for the previous calendar year and the average rate in effect for the current year, but not less than 1.0%. An employer becomes eligible for a computed rate when it has paid contributions during each of the three fiscal years immediately preceding the computation date, established a record of accumulated contributions in excess of benefits charged, and paid wages in at least one of the eight calendar quarters preceding the computation date.
An employer that has not filed all required payroll reports or paid all taxes, penalties and interest due by the cutoff date must be assigned a contribution rate in effect for the taxable year for the employer's classification as an eligible, deficit or new employer, plus an additional assessment of 50 percent of the employer's assigned contribution rate, rounded to the nearest 1/100 of one percent (Sec. 39-51-1213).
Employers with the required experience will be classified on the basis of their experience factors and taxable payrolls for the last fiscal year. An employer's experience factor equals contributions paid minus benefits charged to its account since 10/1/81, divided by its average annual taxable payroll for the same period. Using experience factors and cumulative taxable payroll amounts, employers will be divided into groups and assigned rate classes for the year. Each employer is then assigned the rate opposite its rate class on the appropriate tax schedule.
The rate schedule in effect for a year is assigned on the basis of the ratio of the trust fund balance as of October 31 prior to the rate year to total wages in covered employment for the 12-month period ending June 30 prior to the computation date. The most favorable schedule ranges from zero to 1.67% for positive-balance employers and from 3.17% to 6.37% for negative-balance employers. The least favorable schedule ranges from 1.67% to 3.47% for positive-balance employers and from 4.97% to 6.37% for negative-balance employers.
An employer who has not filed all required payroll reports or paid all taxes, penalties and interest due by the cutoff date must be assigned the maximum contribution rate in effect for the taxable year for its classification as an eligible, deficit or new employer.
An assessment equal to 0.13% of all taxable wages will be made for administrative fund purposes.
Schedule I is in effect for calendar year 2009, and there is also a 0.13% Administrative Fund Tax (AFT) in effect for Rate Classes 1 and 2. Classes 3 through 10 will have an AFT rate of .18%. Rates for 2009, including the administrative tax, may be determined from the following table. "Total Rate" reflects the sum of the Schedule I rate and the AFT.
Eligible Employers
|
|---|
|
Positive Reserve Ratio of:
|
Rate Class
|
ContributionRate
|
AFT Rate
|
|
Total Rate
|
|---|
|
0.145409 to 999.999999
|
Eligible 1
|
0.00%
|
+0.13%
|
=
|
0.13%
|
0.127307 to 0.145408
|
Eligible 2
|
0.00
|
+0.13
|
=
|
0.13
|
0.118877 to 0.127306
|
Eligible 3
|
0.02
|
+0.18
|
=
|
0.20
|
0.111669 to 0.118876
|
Eligible 4
|
0.22
|
+0.18
|
=
|
0.40
|
0.105040 to 0.111668
|
Eligible 5
|
0.42
|
+0.18
|
=
|
0.60
|
0.098055 to 0.105039
|
Eligible 6
|
0.62
|
+0.18
|
=
|
0.80
|
0.088867 to 0.098054
|
Eligible 7
|
0.82
|
+0.18
|
=
|
1.00
|
0.072920 to 0.088866
|
Eligible 8
|
1.02
|
+0.18
|
=
|
1.20
|
0.050267 to 0.072919
|
Eligible 9
|
1.22
|
+0.18
|
=
|
1.40
|
0.000000 to 0.050266
|
Eligible 10
|
1.42
|
+0.18
|
=
|
1.60
|
|
Deficit Employers
|
|---|
|
Negative Reserve Ratio of:
|
Rate Class
|
ContributionRate
|
AFT Rate
|
|
Total Rate
|
|---|
|
-0.000001 to -0.006208
|
Deficit 1
|
2.92%
|
+0.18%
|
=
|
3.10%
|
-0.006209 to -0.011246
|
Deficit 2
|
3.12
|
+0.18
|
=
|
3.30
|
-0.011247 to -0.022439
|
Deficit 3
|
3.32
|
+0.18
|
=
|
3.50
|
-0.022440 to -0.035875
|
Deficit 4
|
3.52
|
+0.18
|
=
|
3.70
|
-0.035876 to -0.067762
|
Deficit 5
|
3.72
|
+0.18
|
=
|
3.90
|
-0.067763 to -0.106732
|
Deficit 6
|
3.92
|
+0.18
|
=
|
4.10
|
-0.106733 to -0.174479
|
Deficit 7
|
4.12
|
+0.18
|
=
|
4.30
|
-0.174480 to -0.293227
|
Deficit 8
|
4.32
|
+0.18
|
=
|
4.50
|
-0.293228 to -0.422067
|
Deficit 9
|
4.52
|
+0.18
|
=
|
4.70
|
-0.422068 to -999.999999
|
Deficit 10
|
6.12
|
+0.18
|
=
|
6.30
|
New employers, who are rated by industry classification, pay the following rates, which include the 0.18% administrative fund tax, for 2009: agriculture, forestry, hunting, and fishing employers, 2.28%; mining employers, 1.78%; construction employers, 2.78%; manufacturing employers, 1.48%; utilities, transportation, and warehousing employers, 1.38%; wholesale trade employers, 1.13%; retail trade employers, 1.18%; finance, insurance, and real estate employers, 1.13%; services employers, 1.38%; and unclassified employers, 2.78%.
SUTA dumping.- Effective January 1, 2006, if an employer transfers its trade or business to another employer, where, at the time of transfer, there is substantially common ownership, management or control of the trade or business, then the unemployment experience attributable to the transferred business will be transferred to, and combined with, the unemployment experience attributable to the acquiring employer. If the sole or primary purpose of such transfer is to obtain a lower unemployment tax rate, the employer will be subject to a penalty of 6% of the employer’s average annual taxable wages and possible criminal penalties.
In order to determine whether a business was transferred solely or primarily to obtain a lower unemployment tax rate, the Department must consider the facts and circumstances of the transfer, including: (1) the cost of acquiring the business (2) how long such business was continued and (3) whether a substantial number of new employees were hired to perform duties unrelated to the business activity conducted prior to the transfer.
Contractors.- In the case of contractors, the law provides that they must withhold sufficient money on their contracts with subcontractors to guarantee that all contributions, penalties and interest are paid by the subcontractors upon completion of the contract. Failure to comply renders the contractor liable for all contributions, penalties and interest due from the subcontractors.
DEADLINES
Tax and wage.- Form UI-5, Employer's Quarterly Wage Report, is due quarterly on or before last day of month following end of each quarter. Electronic filing via the Internet or ICESA file format is available and encouraged by the department.
ENFORCEMENT
The Montana Unemployment Insurance Law is administered by the Department of Labor and Industry.
If, after due notice, an employer defaults in a tax payment, or interest thereon, the amount may be collected by civil action in the name of the Department. An employer adjudged in default must pay the costs of the action. Action to collect such taxes must be brought within five years after the due date of such taxes.
It is provided that the courts of Montana will recognize and enforce liabilities for taxes imposed by another state, provided that the other state extends a like comity to Montana. The Department is authorized to sue in the courts of any state which extends such comity to collect unemployment taxes, penalties and interest due in Montana. Likewise, the officials of other states which extend such comity may sue in the courts of Montana to collect taxes and interest due in those states. Certain procedures are set out for such suits.
Records.- The Department and the chairperson of any appeal tribunal may require from any employing unit sworn or unsworn reports with respect to the persons employed by it which the Department deems necessary for the effective administration of the Law. The information on the reports thus required must be held confidential except to the extent necessary for the proper presentation of a claim, and must not be published nor open to inspection in any manner revealing the individual's or employing unit's identity.
WHO TO CONTACT
The Montana Unemployment Insurance Law is administered by the Department of Labor and Industry, 1327 Lockey St., P.O. Box 1728, Helena, Montana 59624; Telephone (406) 444-3834.
RECORDKEEPING
Each employing unit must keep for five years true and accurate work records, containing such information as the Department may prescribe.
Such records must be open to inspection and audit and must be subject to being copied by the Department or its duly authorized agent at any reasonable time and as often as may be necessary. The information thus obtained is confidential, except to the extent that such information is necessary for the preservation of a claim.
POSTING
Each subject employer must post and maintain printed notices to its workers informing them that the employer is liable for contributions under the law and has so registered. In addition, employers are required to post and maintain printed statements of the regulations with respect to the filing of benefit claims.
PENALTIES
Taxes unpaid on the date on which they are due and payable and that are paid by the end of the month following the due date are subject to a penalty assessment of the greater of $10 or 10% of the amount due. If the taxes are not paid by the end of the month following the due date, there is a penalty assessment of the greater of $15 or 15% of the amount of taxes due. All past-due taxes bear interest at the rate of 18% per year, to be prorated on a daily basis.
A penalty of $40 will be assessed whenever, as the result of a willful refusal of an employer to furnish wage information or pay taxes on time, the Department issues a subpoena to obtain wage information or makes a summary or jeopardy assessment.
When failure to pay taxes on time is not caused by willful intent of the employer, the Department may abate any penalty.
A penalty or fine or imprisonment, or both, may be imposed upon any person who knowingly attempts to avoid or reduce any tax payment required from an employing unit under the Montana Law or under the employment security law of any other state or of the federal government. Willful failure or refusal to make any such payments is likewise penalized.
Employers who finance benefits by the reimbursement method and whose payments are past due are subject to the same interest charges and penalties applicable to employers whose taxes are past due.
If any employer fails to file a report or return within the time specified, or, if the employer's records are inaccurate or incomplete when he has filed a quarterly wage report for the period in question, the Department may make a summary or jeopardy assessment of the amount due, with penalty and interest. Such assessment becomes final within fifteen days unless the employer files written protest.
Any contractor who contracts with a subcontractor must withhold sufficient money on the contract to guarantee that all contributions, penalties, and interest are paid upon completion of the contract. Such a contractor may become liable for all amounts due if it does not take proper action.
After making all reasonable efforts to collect unpaid contributions, payments in lieu of contributions, interest, and penalties, the Department may determine a debt to be uncollectible and may transfer it to the Department of Revenue for collection.
Note that the foregoing discussion concerning collection of contributions is generally applicable to payments made by employers using the reimbursement method of financing benefits.
Any employer who has paid any tax or interest thereon which was erroneously collected may make application, not later than three years after the date such payment became due, or not later than one year from the date on which payment was made, whichever is later, for an adjustment thereof in connection with any subsequent contribution payment, or for a refund where such adjustment cannot be made. Such adjustment or refund may also be made on the Department's own initiative. Refunds will be made without interest. In the event that the Montana Law is not certified by the Secretary of Labor for any year, all taxes for that year will be refunded.
Liens.- Unpaid taxes, including interest and penalties, have the effect of a judgment against the employer, arising at the time the payments are due. The Department may issue a certificate of lien setting forth the amount of payments due and directing the clerk of the district court of any county to enter the certificate as a judgment in the docket. From the time the judgment is docketed it becomes a lien upon the personal property of the employer. After the due process requirements of the law have been satisfied, the Department may enforce the judgment. Such judgment may be enforced at any time within ten years of the creation of the lien.
The lien provided above is not valid against any third party owning an interest in real or personal property against which the judgment is enforced if (1) the third party's interest is recorded prior to the entrance of the certificate of judgment; and (2) the third party receives from the most recent grantor of the interest a signed affidavit stating that all taxes, assessments, penalties, and interest due from the grantor have been paid. A grantor who signs and delivers an affidavit is subject to penalties if any part of it is untrue.
Bankruptcy.- In the event of distribution of an employer's assets pursuant to a court order, including any receivership, assignment for benefit of creditors, adjudicated insolvency, composition, or similar proceeding, taxes then or thereafter due will be paid in full prior to all other claims except taxes and claims for wages of not more than $250 to each claimant, earned within six months of the commencement of the proceeding.
<p>Bankruptcy.— In the event of distribution of an employer's assets pursuant to a court order, including any receivership, assignment for benefit of creditors, ad</p>