Tool | November 2017

State-by-State Guide to Taxes on Retirees

Idaho

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The Bottom Line
Map of Idaho

Mixed Tax Picture

The Gem State taxes all income, except Social Security and Railroad Retirement benefits. Its top tax rate of 7.4% applies to taxable income of $21,810 and above for joint filers. There is a generous retirement-benefits deduction -- but only for those with qualifying public pensions. Idaho does not have an inheritance tax or estate tax.

State Sales Tax

6.0% state levy. Localities (typically resort communities) can add as much as 3%, but the effect on the state average is negible: It's 6.03%. Food is taxable, but the state attempts to offset the levy with a $100 per-person tax credit. Seniors can get $120.

Income Tax Range

Low: 1.6% (on taxable income up to $2,908 for married joint filers and up to $1,454 for individual filers)

High: 7.4% (on taxable income of $21,810 or more for married joint filers and $10,905 or more for individual filers)

Effective income tax rate: 6.4%/individual, 6.7%/joint

Social Security

Benefits are not taxed.

Exemptions for Other Retirement Income

Idaho does not tax Railroad Retirement benefits. It offers a retirement-benefits deduction if you are age 65 or older and receive qualifying retirement benefits -- such as a civil-service pension, Idaho firefighters pension, an Idaho city police pension or military pension. The amount deducted must be reduced by Social Security retirement benefits and Railroad Retirement benefits. The maximum amount for 2016 that could be deducted by married couples filing jointly (age 65 or older) was $47,502, and for singles (age 65 or older), $31,668.

IRAs

Taxable at ordinary income tax rates.

401(k)s and Other Defined-Contribution Employer Retirement Plans

Taxable at ordinary income tax rates.

Private Pensions

Taxable at ordinary income tax rates.

Public Pensions

Idaho offers a retirement-benefits deduction if you are age 65 or older and receive qualifying retirement benefits -- such as a civil-service pension, Idaho firefighters pension, an Idaho city police pension or military pension. The amount deducted must be reduced by Social Security retirement benefits and Railroad Retirement benefits. The maximum amount for 2016 that could be deducted by married couples filing jointly (age 65 or older) was $47,502, and for singles (age 65 or older), $31,668

Property Taxes

The median property tax on Idaho's median home value of $167,900 is $1,276.

Tax breaks for seniors: Homeowners age 65 or older with income of $30,050 or less for 2017 are eligible for a property tax reduction of up to $1,320. Also, those 65 or older with income of $43,636 or less for 2017 can defer income tax payments.

Vehicle Taxes

Sales tax is due.

Inheritance and Estate Taxes

There is no inheritance tax or estate tax.