Cap rate, real cash flow, and return on the cash you put in — including the expenses most analyses leave out. Estimate only, not investment advice.
Estimates only — not investment, tax, or legal advice. How we calculate every figure
Estimated all-in monthly payment for a home price you have in mind.
What homeowners insurance costs in your state, and whether what you pay is out of line.
Income, savings, and debts in — max home price and qualification signal out.
A rental bought for $300,000 and sold seven years later for $394,780 nets $158,925 at closing — and owes about $24,753 of federal tax, $15,273 of it on depreciation you were required to take. Here is the math, why a sale with zero appreciation still owes tax, and the three clocks a fourth-quarter sale starts.
A leveraged rental makes money three ways and cash flow is only one of them. Here is what the other two are worth — and why the structure that maximises them is a bet, not a plan.
How to verify one specific rental deal: audit the seller's pro-forma line by line, comp a real rent, reassess the tax, age the systems, and price the offer the numbers actually support.
Set up basis correctly, claim the depreciation you are owed, survive the passive-loss rules, and know what the sale will cost — with every figure tied to the statute.
Montana guide
Two things about Montana surprise people, and both change a landlord's arithmetic.
The first is good news, and you have to file for it. Montana's 2025 property tax reform (HB 231 and SB 542) created a Homestead Rate beginning with the 2026 tax year — a reduced, tiered rate that applies to owner-occupied principal residences and to qualifying long-term rentals occupied or leased at least seven months a year. Second homes, short-term rentals, and non-residential property pay the higher rate. Roughly 80% of Montana homes saw a net tax cut, averaging over $500 a year. It is not automatic: it must be affirmatively claimed with the Department of Revenue each year, and the 2026 deadline was March 1, 2026.
Montana is one of very few states where a long-term rental is treated like a home for property tax purposes. It is also a state where forgetting a form moves you into the penalty tier.
The second is that the percentage deductible on a Montana policy is for hail, not wildfire. Insurify's 2026 hail analysis puts Montana's average wind/hail deductible at 1.10% of dwelling coverage — $3,786 — high enough to sit in the same band as the Plains hail states. Montana recorded roughly 20 hail events in 2025, some stones reaching four inches. Wildfire, meanwhile, is not managed with a deductible at all. It is managed with non-renewal, and there is no FAIR Plan to catch what falls through.
If you take one thing from this article: file the Homestead Rate claim, and read the wind/hail deductible off the declarations page. Those are the two Montana-specific numbers, and neither is in a listing.
A note before you start: this is general educational information about how rental property arithmetic works in Montana. It is not investment, tax, insurance, or legal advice, and it is not a recommendation about any property. Talk to a Montana CPA about tax treatment, a licensed Montana insurance agent about a real quote, and a Montana real estate attorney about anything contractual.
Read the full Montana guide →21 min read · Updated 2026-08-28