State Taxes at a Glance – Idaho
| Type of Tax | 2023 |
|---|
| Individual Rates | 5.8% (flat tax) |
| Corporate / Business Tax Rates | 6.5% (flat tax) |
| Gross Receipts Tax | None |
| Sales Tax | 6.02% (average) |
| Property Taxes | 0.70% as a percentage of primary home |
| Estate or Inheritance Tax | None |
State Income Taxes in Idaho
The state of Idaho does have an individual income tax. Starting in 2023, the state legislature moved Idaho from a progressive tax schedule to a flat tax of 5.8% to compete with other states such as Utah and Colorado.
State Business Taxes in Idaho
The state of Idaho has a flat corporate income tax of 6.50% on C Corporations. Other flow-thru entities, such as S-Corporations, LLCs and Partnerships are not subject to the corporate income tax, but they are subject to the individual income tax rate.
Permanent Building Fund Tax in Idaho
Additionally, the state of Idaho imposes a small tax on all business & fiduciary entities. The tax is as follow:
- $10 for each C Corporation
- $10 for each S Corporation shareholder
- $10 for each LLC member
- $10 for each Trust or Fiduciary beneficiary
Sales and Property Taxes in Idaho
Sales Taxes in Idaho – Like most states, Idaho has both a state and local sales tax. Its state sales tax is 6.00% and its local sales tax has an average rate of 0.02% (which puts the state average 6.02%).
Property Taxes in Idaho – the average property tax rate for residential property in the state of Idaho is 0.70%, which is well below the national average of 1.08%.
Property Tax Homestead – If you homestead your primary residence in Idaho, they will reduce your home value assessment by $100,000, thereby paying less in property taxes.
IDeal Idaho College Savings Program
Parents that contribute to IDeal account, which is the state’s 529 college savings plan, are allowed a income tax deduction for State income tax. 529 plans are not deductible at the Federal level, but Idaho has made an exception for the state income taxes. To learn more about Idaho’s IDeal College Savings Plan, click here.
Idaho DMV Fees
Idaho DMV fees not based on the value of the vehicle, rather they are based on the weight of the vehicle. Therefore, they are not deductible on your individual tax return. The fees include title, registration, document, and plate fees that range between $70 – $500 dollars.
Idaho Domicile
Idaho presumption is that it’s your permanent place of abode (domicile) if you’ve lived there for over 270 days during the taxable year (almost 9 months.) This is more than the normal 183 days most states require for domicile.
State Tax on Social Security Benefits
Even though Idaho has an income tax, social security benefits are not subject to state tax in “The Gen State.”
Payroll Taxes in Idaho
Unemployment taxes usually consist of three factors. They are: the wage base, the range of UI rates, number of schedules. Below is an outline of the three:
- Wage Base – Idaho has a wage base of $49,900 (high wage base)
- UI Rates – range from 0.21% to 5.40%
- Schedules – Idaho has multiple rate schedules regarding UI
Idaho Business Entities – LLCs
Idaho is inexpensive in regards to opening an LLC. Here are some important facts:
- Idaho has no annual LLC fee. Yay!
- When you register with the state, you pay a one time fee of $100
- Secretary of State of Idaho website – click here