What Are Idaho’s Income, Sales, and Property Tax Rates?

Idaho funds public services through a system of taxes. Understanding the various tax rates is important for residents and businesses operating within the state. These taxes include individual income tax, sales tax, and property tax.

Individual Income Tax

Idaho employs a flat individual income tax rate. For the 2024 tax year, this rate is 5.695% on Idaho taxable income. For single filers, the 5.695% rate applies to taxable income over $2,500, and for married filing jointly, it applies to income over $5,000.

Taxable income starts with gross income, which includes wages, interest, rental income, and other earnings. From gross income, taxpayers can subtract certain deductions to arrive at their taxable income. Idaho generally conforms to federal standard deduction amounts, which for 2024 are $14,600 for single filers and $29,200 for married individuals filing jointly. Taxpayers can also choose to itemize deductions if that provides a greater tax benefit.

Idaho residents are required to file an individual income tax return if their gross income exceeds the applicable standard deduction amount. Non-residents with income sourced from Idaho exceeding $2,500 also have a filing requirement. The general deadline for filing individual income tax returns and paying any tax due is April 15th. Idaho provides an automatic six-month extension to file, but this does not extend the payment deadline; payments are still due by April 15th to avoid interest and penalties.

Sales Tax

Idaho imposes a statewide sales tax rate of 6% on the retail sale of tangible personal property and certain services. This rate applies to most purchases made within the state. While the state rate is consistent, some local jurisdictions, particularly resort cities, have the option to levy an additional local sales tax. These local rates can add up to 3%, resulting in a combined sales tax rate of up to 9% in specific areas.

Certain goods and services are exempt from Idaho’s sales tax. Prescription drugs and durable medical equipment are exempt when prescribed by a practitioner. While many states exempt groceries, Idaho applies the 6% sales tax to unprepared food items. Other exemptions may apply to specific business purchases, such as items bought for resale or certain manufacturing equipment. Businesses collecting sales tax are responsible for remitting these funds to the Idaho State Tax Commission.

Property Tax

Property taxes in Idaho are not set at a single statewide rate; instead, they are levied and collected at the local level. Various taxing districts, including counties, cities, school districts, and fire districts, impose their own property taxes to fund local services. Property values are determined through an assessment process, based on market value. The property tax amount is then calculated by multiplying the assessed value by the specific levy rate set by each local taxing district.

Levy rates can vary significantly from one district to another, reflecting the individual budget needs of each local entity. Property owners receive a notice of valuation annually, which includes the assessed value of their property. To help reduce the tax burden for homeowners, Idaho offers a Homeowner’s Exemption. This exemption reduces the taxable value of a primary residence by a certain amount, thereby lowering the overall property tax owed for eligible individuals.

Idaho also administers a Property Tax Reduction program. This program can provide a reduction of up to $1,500 on property taxes for qualified applicants. Eligibility is based on the applicant’s income from the previous calendar year, an adjusted gross income below a specified threshold. Additional qualifications include meeting certain status requirements, such as being age 65 or older, a widow(er), blind, or having a service-connected disability. Applications for this program are accepted between January 1st and April 15th each year.

Other Notable Taxes

Beyond the primary income, sales, and property taxes, Idaho levies several other taxes with specific rates. The state imposes a gasoline tax, which contributes to the funding of road and transportation infrastructure. The gasoline tax rate in Idaho is 33 cents per gallon.

Businesses operating in Idaho are subject to a corporate income tax. The corporate income tax rate is 5.695% of Idaho taxable income. This rate is set to decrease further to 5.3% for the 2025 tax year. This tax applies to corporations that transact business or have income attributable to Idaho.

Idaho also has vehicle registration fees, which are based on factors such as the vehicle’s age, weight, or value. These fees are collected annually when a vehicle is registered or renewed. While specific rates vary by vehicle type and characteristics, they represent another structured tax contributing to state and local revenues, primarily for transportation-related services.