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H0519
Idaho Tax Law Updates for Investment and Research Credits
Last scannedAug 24, 2026, 7:59 AM
In one sentence
This bill updates Idaho tax laws to match the Internal Revenue Code as of January 1, 2026, and changes rules for tax credits on capital investments and research activities.
What it does
- Updates the definition of 'Internal Revenue Code' in state law to reflect versions effective as of January 1, 2026, with a specific exception for section 85 which remains at its January 1, 2020 version.
- Revises the income tax credit available for qualified capital investments made by taxpayers.
- Changes rules regarding credits for research activities conducted within Idaho and how unused credits can be carried forward.
- Allows certain businesses with negative taxable income in a specific prior year to choose a two-year property tax exemption instead of an income tax credit.
- Sets limits on the total amount of investment credits that can reduce a taxpayer's liability, capping it at 50% of their tax liability.
Who it affects
- Idaho taxpayers who make capital investments eligible for federal tax credits or qualified broadband equipment.
- Businesses conducting research activities within the state of Idaho.
- The State Tax Commission and county assessors responsible for processing claims, exemptions, and recapture calculations.
Limits and unknowns
- The provided bill text is truncated and does not include full details regarding combined corporate reports.
- Specific dollar amounts beyond percentages are not detailed in this excerpt, nor are the exact rules for research activity credits fully visible as that section was cut off.
Plain language
Terms to know
- Qualified Investment
- Property eligible for federal investment tax credits or qualified broadband equipment located in Idaho that is placed into service after December 31, 1981. It excludes motor vehicles under 8,000 pounds gross weight.
- Recapture
- The requirement to pay back a property tax benefit if an investment no longer meets the rules for qualification during a specific time period or was never qualified.
Official record
Sources
Official summary
Internal revenue code conformity
Official activity
Bill history
- H Rev/Tax