There is specific tax information that applies to military service members and their families — including income tax, income tax withholding, sales and use tax, and certain exemptions — and this information differs according to resident status. Additionally, members of the U.S. Armed Forces serving in a combat zone are offered an extension of time to file their Idaho income tax returns.
- Form 43, Idaho Part-Year Resident & Nonresident Income Tax Return
- Form 39NR, Idaho Supplemental Schedule for Form 43, Nonresident and Part-Year Resident Returns Only
- Individual Income Tax Instructions, for Forms 40, 43, 39R, 39NR, 44, and Tax Tables
- Form ID-MS1, Employee's Idaho Military Spouse Withholding Exemption Certificate
- Form ST-102, Use Tax Exemption Certificate New Resident or Military
- Form ST-104MV, Sales Tax Exemption Certificate - Vehicle/Vessel
- IRS Publication 3, Armed Forces' Tax Guide
Idaho residents stationed in Idaho
The military income earned by an Idaho resident stationed in Idaho is subject to Idaho income tax.
- Form 40, Idaho Individual Income Tax Return (for Idaho residents)
Idaho residents stationed outside of Idaho
Active duty military income earned outside of Idaho by an Idaho resident is not subject to Idaho income tax. The full-time duty must be continuous and uninterrupted for 120 consecutive days or more.
- Form 40, Idaho Individual Income Tax Return (for Idaho residents)
- Form 39R, Idaho Supplemental Schedule (for Idaho residents)
Nonresidents stationed in Idaho
If your military home of record is a state other than Idaho, but you are stationed in Idaho, you are considered a "military nonresident." Your active duty military income is not subject to Idaho income tax. However, all other types of Idaho source income (for example, a part-time job) are subject to Idaho income tax. Idaho nonresidents are required to file an Idaho income tax return if gross income from Idaho sources is more than $2,500. More examples of Idaho sources of income include:
- Idaho nonmilitary salaries, wages, and commissions of the service member
- Income from unincorporated business activity conducted in Idaho by either spouse, unless the business is a personal service business of the spouse
- Distributive share of income or loss from a partnership or S corporation transacting business in Idaho
- Rents and royalties from real and tangible personal property located in Idaho by either spouse
- Sale or exchange of Idaho real property
- Winnings from lottery tickets purchased in Idaho
Military nonresidents' civilian spouses or children earning income
When a civilian spouse or children of a military member move to Idaho, they become Idaho residents or part-year residents if they reside in Idaho for less than the entire year. Income from all sources that your civilian spouse or children earn while residents of Idaho is subject to Idaho income tax, unless the exemption below applies.
Service member's spouse income tax exemption
As a service member's spouse, you may qualify for the federal Military Spouses Residency Relief Act (SR 475, HR 1182), which was passed in November 2009. The Act exempts you from paying income tax if:
- You're married to a service member who's serving in Idaho and has registered in the military with another state as a home of record; and
- You've moved to Idaho with the service member and you have the same domicile (permanent residence) as the service member's home of record.
To claim the tax exemption and get a refund of Idaho income taxes withheld in 2009, 2010, or 2011, complete the following steps:
- On Idaho Form 43, select "Military Nonresident" for the service member's status.
- Select "Nonresident" for the service member's spouse.
- For the current state of residence, list the service member's home of record and the spouse's state of domicile (permanent residence).
- The residence of the service member and spouse must be the same, and can't be in Idaho.
- Report the income of the service member's spouse as Idaho income on a Form 43, and include it in the Total Income line on page 1.
- Subtract the exempt income for services performed in Idaho as Other Subtractions on Form 39NR.
- The explanation should state "income for services performed in Idaho by the nonresident spouse of a nonresident service member."
- Carry total subtractions from Form 39NR to the Subtractions from Form 39NR on page 2 of Form 43.
- Report any Idaho tax withheld on page 2 of Form 43.
How to claim the tax exemption from Idaho income tax in the future
- If you qualify for the service member's spouse income tax exemption, you can claim an exemption on your wages from Idaho withholding by filling out Form ID-MS1, Employee's Idaho Military Spouse Withholding Exemption Certificate, and giving it to your employer.
- Your employer will keep a copy and send a copy to the Tax Commission.
- You'll need to complete a new form each year you qualify.
Extensions to file taxes when on active duty in a combat zone
Idaho follows the Servicemembers Civil Relief Act and Internal Revenue Code section 7508 for Idaho individual income taxes. Below are some of the ways the federal and state laws affect you if you're an Idaho military member called to active duty in a combat zone.
Extended due date:
- All tax filing deadlines are extended for at least 180 days after your last day in a combat zone. If you choose to file while you're in a combat zone, see below for signature information.
- If you pay your income tax in full by the end of the deferral period, you won't pay interest or penalty for that period.
- If you're an enlisted member or warrant officer, you don't owe tax on military pay received for any month in which you served in a combat zone. If you're a commissioned officer, the monthly exclusion is capped at the highest enlisted pay, plus any hostile fire or imminent danger pay received. The excluded pay shouldn't be included in the wages reported on your Form W-2.
- Federal law doesn't cover business tax returns, employment taxes, or sales/use tax obligations.
- You must write "COMBAT ZONE" and the date of deployment in red on top of the Idaho tax return you're filing.
Filing while serving in a combat zone:
- If you're serving in a combat zone and can't sign your joint income tax return, your spouse can sign the return for you without a power of attorney. Your spouse should attach a signed statement to your return that explains you're serving in a combat zone. If you're filing an electronic return, keep a copy of the statement with your federal Form 8453.
You can find more information on how federal taxes affect members of the armed forces in IRS Publication 3, Armed Forces' Tax Guide.
For more information about federal taxes and service members, visit the Internal Revenue Service's Military Web page.
Purchases while stationed in Idaho
With few exceptions, members of the military owe sales or use tax on purchases they make while stationed in Idaho. This applies regardless of residency status. A common exception is a purchase from a military-owned facility such as the commissary.
Bringing personal property into Idaho
If you're a military member temporarily assigned to Idaho and you bought personal property without paying sales tax in the United States, you may owe Idaho use tax when you bring that property into Idaho. You owe use tax on household goods, personal possessions, personally-owned vehicles, and personally-owned aircraft if you acquired the property after receiving orders to transfer to Idaho or within three months of moving to Idaho, whichever is shorter. You don't owe Idaho use tax for purchases you or your spouse made before that time.
If you paid a U.S. sales tax of less than 6% and the purchase occurred within the time period noted above, you owe Idaho use tax on the difference. For purposes of vehicle registration in Idaho, see Form ST-102, Use Tax Exemption Certificate, New Resident or Military.
Buying a vehicle in Idaho
If you're a military member stationed in Idaho with your home residence in another state, you may qualify for a sales tax exemption when buying a car in Idaho. You can qualify for an exemption at the time of sale only if you provide a copy of your military orders showing you must report to a duty station in another state within 90 days. If the vehicle will be in Idaho more than 90 days, it will be subject to tax. See Form ST-104MV, Sales Tax Exemption Certificate – Vehicle/Vessel.
Use tax may be due to the next state where you report to duty. Please contact that state's tax agency for more information.
- Revenue and Taxation Law: Chapter 30 Income Tax - Adjustments to Taxable Income (h)
- Revenue and Taxation Law: Chapter 36 Imposition and Rate of the Use Tax - Exemptions (l)
- Members of the Uniformed Services Income Tax Rule 032 [PDF]
- Vehicles and Vessels - Gifts, Military Personnel, Nonresident, New Resident, Tax Paid to Another State, Sales to Family Members, Sales to American Indians, and Other Exemptions Sales Tax Rule 107 [PDF]
- Servicemembers Civil Relief Act (federal Act) [PDF]