IDAHO
community property state

 

Military Income:   Fully taxable when stationed in Idaho.  Not taxable when stationed outside of Idaho.

Military Filing Requirement:  Yes, if you are required to file a Federal return, Idaho requires all residents to file an Idaho Return.

Military Spouse Residency Relief Act:  Service member serving in state who has registered in the military with another state as a home of record. Spouse in state to be with service member. Spouse must be a resident of same state as service member.

Forms Used:            

Filing Status:  Same as federal. 

Attach Copy of Federal Return:  Yes

Not Taxed:

Other State Tax Credit:  Available for residents and part year residents.  Attach Idaho Form 39 and copy of other state return.

Where to Mail: Other Info:
Idaho State Tax Commission
PO Box 56
Boise, ID 83756-0056
Idaho State Tax Commission
PO Box 83784
Boise, ID  83722-3784
Refund Inquiries:  1-888-228-5770 General Information:  1-800-972-7660
Forms:  1-800-972-7660 E-File Help Desk (208) 334-7822
Forms by fax: 1-888-228-5770  
Website:  tax.idaho.gov
E-filing Info:  Retain ID 8453 for 3 years.  The following CANNOT be filed electronically:
  • Returns claiming credit for taxes paid to other states.

  • Married Filing Separate returns.

Tax Forms:
https://tax.idaho.gov/m-formpub.cfm  

 

Filing Status Scenarios

1.  Taxpayer and Spouse Residents (Use also for Single Taxpayer)
2.  Taxpayer and Spouse Different States of Residence
3.  Taxpayer and Spouse Non-Residents
4.  Taxpayer Non-Resident - Spouse Part-Year Resident
5.  Taxpayer Single - Resident but Income from Other State
6.  Amended Return

 

1.  Taxpayer and Spouse Residents (Use also for Single Taxpayer) - Taxpayer and spouse are both Idaho residents, lived at their present location all year, and one or both had income.

Main Info Screen.  Idaho does not tax military income when stationed outside the state sothe military members income is not taxable.  If taxpayer and spouse, (if married), are full year Idaho residents, a Full year resident return will be prepared. 

W-2 Form.  To exclude the military income for residents living outside Idaho you must check the Military box on the bottom of the W-2 form for the military member's income.

Idaho 40 Form.  A joint resident Idaho income tax return is prepared..

 

Idaho Form 39R - Idaho Supplemental Schedule for Residents.  As Idaho does not tax military income when stationed outside the state, the military members income is not taxable. Ensure the amount of Active Duty military income is listed on Subtractions, line 11.

Idaho Form 40, Pg 2 - Line 43 - The Grocery Credit Worksheet at the bottom of Page 2 of Idaho Form 40 should be completed to give a Grocery Credit.  Active duty military who are Idaho residents are entitled to the Grocery Credit. Enter 12 for any Active Duty residents as they are considered domiciled in Idaho regardless of their physical location. Enter the appropriate number of months the spouse was physically present in the state for at least 15 days of the month. If there are dependants, enter the appropriate values on the worksheet.

Complete all other fields and forms with red or required information.

2.  Taxpayer and Spouse - Different States of Residence - Taxpayer or spouse is a resident of Idaho, while the other member is a resident of a different state.  A Idaho income tax return must be prepared due to the taxpayer or spouse having Idaho earned income.

Main Info Screen.  If the military member is stationed outside Idaho and still had taxes withheld, he may file as a nonresident for a full refund.   For this example, the taxpayer is a resident of Idaho while the spouse is a resident of North Dakota.

Resident/Nonresident Worksheet.  Review form to ensure income is split correctly for the appropriate states.

Idaho Form 43.   A joint non-resident Idaho income tax return must be prepared.   Under Residency status check the box for ID resident on active military duty and nonresident spouse.  Enter the state of residence under the current state of residence for the Spouse (ND in this example). Enter 12 in the "Full months in Idaho this year" field for active duty military members who are residents of Idaho, (Grocery credit will not compute correctly otherwise.)

Idaho Form 39NR - Idaho Supplemental Schedule for Nonresident and Part-Year Residents.  As Idaho does not tax military income when stationed outside the state, the military members income is not taxable.  The only way to properly do this for Idaho is to enter the amount of military income on line 7 in Section B of the Idaho Form 39NR.

Idaho Form 43 - Adjustments, Page 2 will be generated.  This portion is used to subtract out the other-states (North Dakota) and military stationed outside the state income.  

Idaho Form 43 - Line 46 - Grocery Credit Worksheet, (bottom of Page 2), should be completed to give a Grocery Credit.  Active duty military who are Idaho residents are entitled to the Grocery Credit.

Review the remainder of the Idaho Form 43 and 39NR to ensure the other state income is being subtracted correctly.  Complete all other fields and forms with red or required information.

3.  Taxpayer and Spouse Non-Residents - Taxpayer and spouse are residents of a different state.  The spouse and taxpayer must file a Idaho tax return due to one or both having Idaho earned income.

Main Info Screen.  If both members are residents of another state, the parties should file as nonresidents.  For this example, the taxpayer and spouse are both residents of Wisconsin but must file a Idaho income tax return because the spouse worked in Idaho.

Idaho Form 43.   A joint non-resident Idaho income tax return should be prepared.  Under Residency status check the box for Military nonresident and nonresident spouse.  Enter the state of residence under the current state of residence for the Taxpayer and Spouse (WI in this example). In order to qualify for the Military Spouse Residency Relief Act, the taxpayer and spouse must be residents of the same state.

Idaho Form 43 - Adjustments, Page 2 will be generated.   This part of the form is used to subtract out the other-states (Wisconsin) income.  

Idaho Form 39NR Pg 1. In order to comply with the Military Spouse Residency Relief Act, the wages from a nonresident military spouse are not entered on Line 7 on Form 43. Link to a scratch pad from Line 7 as shown in the example.

Complete a scratchpad like the one in the example. Enter the statement as shown in the example to comply with Idaho Military Spouse Residency Relief Act instructions. Ensure you enter the nonresident military spouse's wages/earnings as a negative number.

Review the remainder of the Idaho Form 43 to ensure the other state income is being subtracted correctly.  Complete all other fields and forms with red or required information.

4.  Taxpayer Non-Resident - Spouse Part-Year Resident - Taxpayer and spouse moved to or from Idaho during the tax year.  The taxpayer is a resident of a different state.  The Spouse is a part-year resident of Idaho.  The Spouse and taxpayer must file a Idaho tax return due to one or both of them having Idaho earned income and possibly income from another state.

Main Info Screen.  For this example, the taxpayer is in the military and a resident of Indiana.  The taxpayer and spouse moved from Idaho to North Dakota during the year.  The spouse was a resident of Idaho but is now changing their residency to North Dakota for tax purposes.  The spouse therefore was a part-year resident of both Idaho and North Dakota and must file a Idaho income tax return because the spouse worked in Idaho.

Part Year Resident States Worksheet.  Review form to ensure income is split correctly for the appropriate states.

Idaho Form 43.   A joint part-year resident Idaho income tax return must be prepared.  This form will be generated for a Idaho part-year resident who must report Idaho earned income.  Under Residency status check the box for Military nonresident and part-year resident spouse.  Enter the state of residence under the current state of residence for the Taxpayer and Spouse (IN and ND in this example).Enter appropriate number in the "Full months in Idaho this year" field for active duty military members who are residents of Idaho, (Grocery credit will not compute correctly otherwise.)

Idaho Form 43 - Adjustments, Page 2 will be generated.  This part of the form is used to subtract out all the other-states (Indiana and North Dakota) income.  

Review the remainder of the Idaho Form 43 to ensure the other state income is being subtracted correctly.  Complete all other fields and forms with red or required information.

5.  Single Military Resident of Idaho with Income from Another State  - Taxpayer is single.  The taxpayer must file a Idaho tax return due to him or her having Idaho earned income.

Main Info Screen.  For this example the taxpayer is a military member stationed in North Dakota but a resident of Idaho.  The taxpayer had a job in North Dakota therefore having North Dakota earned income.  If the military member is stationed outside Idaho and still had taxes withheld, he or she can file for a full refund. File a Full year resident return.

W-2 Form.  To exclude the military income for residents living outside Idaho you must check the Military box on the bottom of the W-2 form for the military member's income.

Resident/Nonresident Worksheet.  Review form to ensure income is split correctly for the appropriate states.  

Idaho 40 Form.  A Full year resident Idaho income tax return is prepared.


Idaho Form 39R - Idaho Supplemental Schedule for Residents.  As Idaho does not tax military income when stationed outside the state, the military members military income is not taxable. Verify the Active Duty military income is exempted on line 11 of Form 39R.

Idaho Form 40 - Line 46 - Grocery Credit Worksheet should be completed to give a Grocery Credit.  Active duty military who are Idaho residents are entitled to the Grocery Credit. Enter the number of months the active duty member was a resident of Idaho.

Idaho Form ID 39R, Page 2, Section D.  Credit for Tax Paid to Another State must be prepared to give a credit for taxes paid to North Dakota. You must complete the other states tax return first, then enter the amount of tax from the other states tax return.  This is not the amount the taxpayer had withheld from his or her pay but the amount of tax imposed on them.  Line 2 is the amount of income earned in the other state (North Dakota).  Line 6 is the amount of income tax liability on the (North Dakota) tax return.

Complete all other fields and forms with red or required information.

6.  Amended Return  - An amended Idaho return must be filed because the taxpayer received new tax information after their Idaho return was filed.
Federal 1040X Form.  Before making any changes to the tax return add the US 1040X form to the tax return.  You must check the box under Income and Deductions to lock in the entries in Column A - Original amount or as previously adjusted.

Idaho 43 - Idaho Part-Year Resident and Nonresident Income Tax.  The same Idaho 43 Form that was used to file the return is used to amend the return.  Answer the questions as in the example.  You must check the box to lock in the original refund or balance due before making any changes to the return.

Make whatever changes are required to the federal tax return.  For this example, a new W-2 was received.

Idaho 43 - Idaho Part-Year Resident and Nonresident Income Tax.  Return to the Idaho 43 form to determine if the taxpayer is receiving an additional refund or owes money.

Idaho Miscellaneous Statement.  You must enter an explanation for why the Amended Return is being prepared. 

Amended returns can not be e-filed.  The taxpayer must mail the federal 1040X and any state amended returns if required to be filed.