Idaho has a state income tax, and it applies to most residents and workers
Yes, Idaho charges a state income tax on wages, self-employment income, interest, dividends, and other earnings. The tax rate depends on your total income and ranges from 1% to 5.8% across six tax brackets. Unlike some states, Idaho does not exempt retirement income, Social Security, or military pensions from taxation, though certain deductions and credits can reduce what you owe.
If you work in Idaho or live there, you will file a state return in addition to your federal return. The filing important date matches the federal important date — typically April 15 — and you can file electronically through the Idaho State Tax Commission website or by mail.
Key Takeaways
- Idaho's income tax rates range from 1% to 5.8% depending on your income bracket, and the state taxes most types of income including wages, self-employment, and retirement distributions.
- You must file a state return if you earned income in Idaho or lived there for the full tax year, even if you owe no federal tax.
- Idaho allows deductions for federal income tax paid, mortgage interest, charitable donations, and other expenses, which can lower your state tax bill.
- The state offers credits for dependent children, education expenses, and property taxes that directly reduce the amount you owe.
Idaho's income tax brackets and rates for 2024
Idaho uses six tax brackets. Your rate depends on whether you file as single, married filing jointly, married filing separately, or head of household. For single filers in 2024, the brackets start at 1% on income up to $1,783, then climb to 5.8% on income above $28,515. Married couples filing jointly face the same 5.8% top rate but on income above $57,029.
The brackets adjust slightly each year for inflation, so the exact dollar amounts change. You can find the current brackets on the Idaho State Tax Commission website under "Tax Rates and Forms." The key point is that Idaho is a progressive system — you do not pay the top rate on all your income, only on the portion that falls in the highest bracket you reach.
What income Idaho taxes and what it does not
Idaho taxes W-2 wages, self-employment income, capital gains, rental income, interest, and dividends. It also taxes distributions from retirement accounts like 401(k)s and IRAs, as well as Social Security benefits if your total income exceeds certain thresholds. Military pensions and federal employee pensions are taxed the same way as other retirement income.
Some income is exempt. Gifts and inheritances are not taxed. Certain scholarships and educational grants used for tuition and books are excluded. Workers' compensation benefits and some disability payments are not subject to state income tax. If you receive income from sources outside Idaho, you may still owe Idaho tax on it if you are a resident.
Deductions that lower your Idaho tax bill
Idaho allows you to deduct federal income tax you paid during the year, which is one of the largest deductions available. You can also deduct mortgage interest, property taxes, charitable contributions, and medical expenses that exceed a certain threshold. If you are self-employed, you can deduct business expenses, half of your self-employment tax, and contributions to a self-employed retirement plan.
You have the choice between taking the standard deduction or itemizing deductions. For 2024, the standard deduction for single filers is $14,600 and for married couples filing jointly it is $29,200. If your itemized deductions add up to more than the standard deduction, itemizing saves you money. The Idaho State Tax Commission provides a worksheet to help you decide which method works better for your situation.
Tax credits that directly reduce what you owe
Tax credits are different from deductions — they subtract directly from your tax bill rather than from your income. Idaho offers a dependent exemption credit of $205 per dependent for 2024, which means you subtract $205 for each child or dependent you claim. The state also offers a child and dependent care credit if you paid for childcare so you could work.
Education-related credits include the Earned Income Tax Credit (EITC), which is available to lower-income workers and families, and credits for higher education expenses. Idaho also allows a property tax relief credit for homeowners and renters with lower incomes. You must meet income limits and other requirements to claim these credits, and the Idaho State Tax Commission website lists the specific rules for each one.
Who must file a state return in Idaho
You must file an Idaho return if you lived in the state for the full tax year and earned income above the filing threshold. The threshold depends on your filing status and age. For a single person under 65 in 2024, you must file if your gross income was $14,600 or more. For married couples filing jointly, the threshold is $29,200 if both spouses are under 65.
If you lived in Idaho for only part of the year, you may still need to file if you earned income while living there. If you moved to Idaho during the year, you file a part-year resident return. Even if you do not owe tax, filing can be worthwhile if you paid taxes through withholding or are may have access to to a refund or credit.
How to file your Idaho state return
You can file electronically through the Idaho State Tax Commission website using approved tax software, or you can read forms and file by mail. The state accepts returns filed through commercial tax preparation software, which often handles both federal and state returns at once. If you file electronically, you typically receive a refund within two to three weeks; paper returns take longer.
You will need your Social Security number, W-2s or 1099s showing income, records of deductions and credits you are claiming, and your federal tax return information. If you are self-employed, bring your business income and expense records. The important date is the same as the federal important date, usually April 15, though the state sometimes extends it if the date falls on a weekend or holiday.
Frequently Asked Questions
Do I have to pay Idaho income tax if I work in Idaho but live in another state?
Yes, you owe Idaho income tax on wages earned in the state, even if you live elsewhere. You file an Idaho non-resident return on the income earned there. You may also owe tax to your home state, depending on its rules. Some states have reciprocal agreements that prevent double taxation, but Idaho does not have reciprocal agreements with neighboring states.
Is Social Security taxed in Idaho?
Social Security benefits may be taxed in Idaho if your total income exceeds certain thresholds. The threshold depends on your filing status and whether you have other income like wages or retirement distributions. If your combined income (adjusted gross income plus nontaxable interest plus half your Social Security) exceeds $25,000 for single filers or $32,000 for married couples filing jointly, some of your benefits are taxable.
What if I moved to Idaho during the year?
You file a part-year resident return that shows income earned before and after you moved. You only owe Idaho tax on income earned while you lived in the state. You will need to report your move date and provide documentation of when you established residency. The Idaho State Tax Commission provides a part-year resident worksheet to help you calculate the correct amount.
Can I file my Idaho return if I owe federal taxes?
Yes, you can file your state return independently of your federal return. However, if you owe federal taxes, the IRS may offset a state refund you are due. It is generally better to pay what you owe on both returns by the important date to avoid penalties and interest.
Does Idaho offer an extension if I cannot file by April 15?
Yes, you can request an extension from the Idaho State Tax Commission, which typically gives you until October 15 to file. An extension gives you more time to file, but it does not extend the time to pay taxes owed. If you expect to owe tax, you should pay by April 15 to avoid interest and penalties, even if you file late.