At tax time, Idaho assess a tax rate varying from 1.6% to 7.4% over seven income levels. These tax brackets are reviewed annually to adjust for inflation. The following represent the seven different tax rates and their corresponding income thresholds for single taxpayers and those who may be married but file separately.
- 1.6 % on the first $1,408 of taxable income
- 3.6 % between $1,409 and $2,817 of taxable income
- 4.1 % between $2,818 and $4,226 of taxable income
- 5.1 % between $4,227 and $5,635 of taxable income
- 6.1 % between $5,636 and $7,044 of taxable income
- 7.1 % between $7,045 and $10,567 of taxable income
- 7.4 % on taxable income of $10,568 and greater
For couples who file their returns together, the rate of taxation is the same, although the income amounts double. So, for a taxpayer who files jointly with their spouse in Idaho to be taxed at a rate of 4.1%, they’d have to have an annual taxable income between $5,636 and $8,452. Each tax bracket is based on the consumer price index of the state and adjusted each year. Like many other states, the deadline for filing a return is April 15th provided that date is not a weekend or holiday. If so, returns are due on the next business day.
Railroad Retirement and Social Security benefits are non-taxable forms of income. If an Idahoan is 65 or older (62 if disabled) and retired, they may be eligible to receive an exemption for civil service or military benefits.
In Idaho, taxpayers may be eligible to receive a credit for sales tax charged on groceries, depending on age and income level. The credit amount varies, but is claimed by filing Form 24, Idaho Grocery Credit Refund, whether you file taxes or not.
Residents have the option of taking tax credits for taxes paid to other states, donations to state education systems, and certain non-profit youth or rehabilitation centers. If any part of your income as an Idaho resident is taxed by another state, you may be eligible to receive a credit.
Idaho Residents
Residency is determined by two factors: keeping a home in the state for the tax year and spending 270 days physically in Idaho, or the establishment of a domicile in the state for the entire year.
Domicile refers to the permanent home that you intend on returning to when you are away. It is the central hub of your life, family, personal and business environments.
It’s important to note that residence and domicile are not used interchangeably. You can have multiple residences, but only one domicile. Once you’ve established your domicile, it doesn’t change unless abandoned without the intention of returning.
