Understanding Idaho’s Tax System: A Simple Guide
Idaho’s tax system is a complex one, with a variety of different taxes levied on individuals and businesses. This guide will provide you with a basic understanding of the state’s tax system, including the different types of taxes that are levied, who is responsible for paying them, and how much they cost.
Income Tax
Idaho’s income tax is a progressive tax, meaning that the rate you pay depends on your income level. The state has four income tax brackets, with rates ranging from 1.5% to 6.925%. The table below shows the income tax rates for each bracket.
| Income Bracket | Tax Rate |
|---|---|
| $0 – $9,075 | 1.5% |
| $9,076 – $27,950 | 3.5% |
| $27,951 – $71,450 | 4.9% |
| $71,451 or more | 6.925% |
In addition to the state income tax, Idaho residents may also be subject to federal income tax. The federal income tax is a progressive tax, with rates ranging from 10% to 37%.
Sales Tax
Idaho’s sales tax is a flat tax of 6%. This means that the same rate is applied to all purchases, regardless of the type of item or the price. The sales tax is collected by the seller at the point of sale.
There are a few exceptions to the 6% sales tax rate. Some items, such as groceries and prescription drugs, are exempt from sales tax. Other items, such as prepared food and alcoholic beverages, are subject to a higher sales tax rate of 8%.
Property Tax
Idaho’s property tax is levied on real property, such as land and buildings. The tax rate is set by each county, and it varies depending on the location of the property. The table below shows the average property tax rates for each county in Idaho.
| County | Average Property Tax Rate |
|---|---|
| Ada | 1.06% |
| Bingham | 0.87% |
| Boise | 1.12% |
| Canyon | 0.92% |
| Custer | 0.88% |
In addition to the property tax levied by the county, Idaho residents may also be subject to a school district tax and a municipal tax. The school district tax is levied by each school district, and the municipal tax is levied by each city or town.
Other Taxes
In addition to the taxes listed above, Idaho residents may also be subject to other taxes, such as the following:
- Gasoline tax
- Liquor tax
- Cigarette tax
- Inheritance tax
- Gift tax
The rates for these taxes vary depending on the type of tax and the amount of the transaction.
How to File Taxes in Idaho
Individuals who are residents of Idaho are required to file an income tax return with the state by April 15th of each year. The state also offers