Idaho updates conformity for 2018; lowers tax rates
TAX ALERT |
UPDATE: March 13, 2018
On March 12, 2018, Idaho Governor C.L. Butch Otter signed House Bill 463, providing 1) an update to the state’s general conformity to the IRC for 2018 tax years and 2) reductions in both personal and corporate tax rates.
Recently, Idaho updated its conformity to the IRC for 2017 tax years as of Dec. 21, 2017, except for Sections 965 and 213 which were adopted as of Dec. 31, 2017. House Bill 463 updates the state’s conformity to the IRC as of Jan. 1, 2018 for 2018 tax years and requires a corporate income tax addback for deductions under Sections 245A (dividends received deduction), 250 (foreign-derived intangible income), and 965 (transition tax provisions).
Accordingly, the updated conformity adopts most of the changes in the recent federal tax reform package, including the increase in standard deduction and the elimination of the personal exemption.
House Bill 463 reduces both personal and corporate income tax rates. Each personal income tax bracket is reduced by 0.475 percent. The corporate income tax rate is also reduced by 0.475 percent, resulting in a new rate of 6.925 percent, from 7.4 percent.
ORIGINAL ALERT Feb. 13, 2018: Idaho is first state to address conformity post federal tax reform