Idaho Bills

Amends and repeals existing law to revise the income tax rate, to extend the child tax credit indefinitely, and to repeal the Parental Choice Tax Credit.

This legislation would permanently extend the child tax credit of $205 per qualifying child, and offsets that by eliminating the parental choice tax credit and adjusting the income tax rate from 5.3% to 5.325%. for individuals and corporations.

Amends, repeals, and adds to existing law to revise provisions regarding the rate of income taxes.

The purpose of this bill is to give the state of Idaho the flexibility to increase revenue should the uncertainty concerning state and national economic conditions require considering doing so. This bill does not repeal H40. It only puts a potential one-year pause on just the income tax portion of H40. It does not change the military or capital gains on precious metals portion of H40. The bill restores the income tax rate to the rate prior to H40 (5.695%) only for tax year 2026 and then returns to the tax rate in H40 (5.3%) for tax year 2027 and beyond. If this bill should become law and economic conditions in January 2027 are favorable, this law could be repealed retroactive to January, 2026 by the 2027 legislature and the income tax rate would remain unchanged at 5.3% for 2026 and beyond.

Amends and adds to existing law to provide certain deductions to income taxes and to provide for an increased food tax credit for seniors.

This legislation brings tax relief to those who are struggling in our Idaho economy. This includes adopting the new federal tips credit and the overtime deduction. The recent federal tax bill, HR 1, provided a $6000 deduction for seniors, which helps reduce federal social security taxes they pay. However, Idaho income tax laws do not tax social security so well over half seniors will see no tax relief on their state tax return. Instead, this legislation adds a senior $50 grocery tax credit so that all seniors receive some benefit. The $50 increase combined with the $155 present credit, will offset grocery taxes paid by seniors just as a complete repeal of the grocery tax would do.