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Business Exemptions

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General Business Exemptions

All retail sales in Idaho are taxable unless Idaho or federal law specifically exempts them. See the Basics page for sales and use tax exemptions for more information.

Below are Idaho exemptions that might apply to businesses.

General

Vehicles and vessels

More information

Basics of Sales and Use Tax Exemptions

All retail sales in Idaho are taxable unless Idaho or federal law specifically exempts them. In all cases of exempt sales, the buyer and seller must each keep clear and complete records to explain why the seller didn’t charge the buyer sales tax.

Restrictions can apply to any tax-exempt sale or use. If the sale is taxable and the buyer doesn’t pay tax to the seller, the buyer owes use tax, which is the same rate as sales tax.

See exemptions that might apply to these main groups of taxpayers:  

More information

Individual Exemptions

All retail sales in Idaho are taxable unless Idaho or federal law specifically exempts them. See the page for sales and use tax exemptions for more information.

Below are Idaho exemptions that might apply to individuals.                 

For specific individuals

For all individuals

More information

Sales and Use Tax Record of Returns Filed

Auctioneers

An auction is the buying and selling of goods through a bidding system. An auctioneer is a person who manages an auction by offering items for bid, taking bids, and then selling the items to the highest bidder. Auctioneers are retailers in the business of selling tangible personal property. Auctioneers act as intermediaries between buyers and sellers; they might not have the title to the goods sold.

When a buyer purchases goods at an auction, the sale is between the buyer and the auctioneer. The buyer makes payment to the auctioneer. If there’s a problem with the sale, the buyer will contact the auctioneer to resolve the issue.

Idaho state law requires auctioneers, agents, brokers, distributors, and factors who facilitate the sale of tangible personal property to collect and remit tax on retail sales unless a valid exemption exists. They must collect sales tax even if Idaho law wouldn’t require the property owner to collect the tax.

  • Example: An auctioneer sells a vehicle owned by the federal government. The federal government is exempt from collecting tax. Idaho law still requires the auctioneer to collect tax because the auctioneer is making the sale.

Most auctioneers charge a buyer’s fee (generally 10% – 15% of the sale). Buyers pay this fee to get the tangible personal property they purchased in the auction. Buyer’s fees are taxable.

Out-of-state sales

Sales tax doesn’t apply to sales of tangible personal property that the seller delivers outside Idaho using a common carrier, U.S. mail, or seller’s delivery service.

The seller must keep records to support the sales tax exemption. This includes shipping bills of lading, postal receipts, or invoices that show the out-of-state destination with supporting documents.

If the buyer picks up the tangible personal property in Idaho or pays a third party to pick up the property and deliver it outside Idaho, the sale is subject to Idaho sales tax. That’s because the transfer of title has occurred in Idaho.

Out-of-state purchases

Use tax applies when an Idaho buyer purchases goods outside of Idaho that they use or store in Idaho. Learn more on our Use Tax page.

Nonprofit Guides

Nonprofits and
Income Tax

Income Tax

Nonprofits and
Sales Tax

Sales Tax

Who Needs a Seller’s Permit?

Almost every seller in Idaho needs a seller’s permit. Sellers are individuals, businesses, nonprofit organizations, or government agencies that do any of the following:

  • Make more than two sales during any 12-month period.
  • Make it publicly known that they sell taxable products or services.
  • Sell to a consumer who won’t resell or lease the product.
  • Both sell goods and improve real property (e.g., contractor retailers).
  • Out-of-state retailer making sales into Idaho of more than $100,000 in any 12-month period (economic nexus).
  • Out-of-state retailer making sales into Idaho of more than $10,000 in any 12-month period through a retail referral agreement (click-through nexus).
  • Have others in Idaho selling, delivering, installing, or taking orders for their goods. This includes multilevel marketing companies and networking companies.

Doing any of these activities makes you a retailer, and you need a seller’s permit. In addition to the information on this page, see:

When you don’t need a seller’s permit

You don’t need a seller’s permit if you qualify for the occasional sales exemption. You can take advantage of this exemption if both of these are true:

  • You make only two or fewer sales of taxable goods or services in any 12-month period.
  • You don’t make it publicly known that you sell taxable products and services. (You aren’t in the business of selling.)

See Occasional Sellers for more information.

The only other time you don’t need an Idaho seller’s permit is if you sell only on third-party websites or social media sites that register with the Tax Commission as marketplace facilitators. These third-party sellers report your sales, collect Idaho sales tax, and forward it for you. You’ll just need to verify they’re reporting your sales to us.

Renting out lodging through short-term rental marketplaces is a little different. The short-term rental marketplace must collect and send in all taxes due for all your sales. Otherwise, you still need permits. See Hotels, Motels, and Short-Term Rentals and common charges for property and services.

Temporary or regular seller's permit?

If you need an Idaho seller’s permit, Idaho has two types: temporary and regular. And, there are two kinds of temporary seller’s permits.

You can’t get a temporary seller’s permit if you sell, lease out, or rent out vehicles. You also can’t get a temporary seller’s permit if you rent out short-term lodging. You need a regular seller’s permit. The only exception for lodging is if you only rent out on short-term rental marketplaces such as Airbnb or VRBO, and those marketplaces collect and send in all taxes due for all sales you make. You’ll just need to verify that they’re reporting your sales.

For other businesses, the following chart might help you determine which permit you need. Applying for any of these permits is free.

Temporary seller’s permit

  • Valid for 1 specific Idaho event (e.g., farmers market or craft show).
  • Can have up to 3 total permits* per calendar year.

See Temporary seller’s permits.

Temporary seller’s permit

  • Valid for 90 days for all Idaho events and your own sales activities.
  • Can have up to 3 total permits* per calendar year.

See Temporary seller’s permits.

Regular seller’s permit

  • Valid indefinitely for all Idaho events and your own sales activities.
  • Valid until cancelled.

See Regular seller’s permits.

* Any combination of the temporary seller’s permits

Promoter-sponsored events

A promoter-sponsored event is either of these:

  • A regular series of events where people conduct business (e.g., farmers markets, swap meets, flea markets, gun shows, and fairs).
  • An event where two or more persons offer, sell, or exchange products or services. The event promoter charges them a fee to appear, charges attendees a fee to enter, or both.

Promoters need to register their events with the Tax Commission. Anyone selling at the event needs to register for that event and make sure they have a seller’s permit. See Promoter-Sponsored Events for more information.

Religious groups, nonprofits, and schools

Religious groups and nonprofits that sell at events (or anywhere else) must get a seller’s permit, collect sales tax on sales they make, and send in the tax, unless an exemption applies. See Sales a Nonprofit Makes.

Religious groups and nonprofits that host events like bazaars or fairs are promoters. They must register the event unless it meets specific criteria. See Nonprofits and Religious Groups and Promoter-Sponsored Events.

Schools should check Sales Schools Make for more information about event admissions, selling concessions, fundraising, and other topics. Also see Promoter-Sponsored Events.

Internet and mail-order businesses

  • If your business is in Idaho, you must get a regular seller’s permit, collect sales tax from Idaho buyers, and forward the tax to us.
  • If your business isn’t in Idaho but you’re doing business in Idaho, you must get a regular seller’s permit, collect sales tax from Idaho buyers, and forward the tax to us.

The only exception is when you sell only with marketplace facilitators such as Wayfair, and those sites collect and send in the taxes due to us. You’ll just need to verify that they’re reporting your sales.

Multi-level marketing (MLM) and networking businesses

Multi-level marketing and networking businesses are companies that use their members to sell products directly, often in home. The sellers are often called “distributors.” Sometimes the distributors recruit others to sell the product and receive payment based on sales made by the sellers they recruit.

If you’re an MLM, we’ll require you to get a seller’s permit and collect and remit taxes on all sales made to or by your distributors and the sellers they recruit. This way, your distributors won’t need to have a seller’s permit. You’ll need to give them your Idaho seller’s permit number to keep in their files.

You have to collect the correct tax amount from your customers. Your sales invoices must show the amount of tax you charged your customer.

If you keep adequate sales records

  • You can sell products to your distributor at the wholesale price but submit sales tax on the actual retail price to the final customer.
  • If your distributor is the final customer, the wholesale price you charge becomes the retail price.

Note: To keep adequate sales tax records, you must work closely with your distributors to determine who the final customer is. If you don’t keep adequate sales records, you must collect sales tax on the suggested retail price.

Selling before you get a seller’s permit

You could be fined if you start your business without applying for the permit. It takes time to get your permit, so it’s best to plan ahead. If you can’t wait to open your business until you receive a permit, keep a copy of your application to prove you’ve applied. Collect the correct tax from your customers, and forward the tax when you receive your permit and tax returns.

Other tax requirements

Whether you’re in business for yourself, or you represent a corporation or partnership, you’ll need to file an Idaho income tax return if your gross income from Idaho meets the filing requirement. If you have employees in Idaho, you may also need to file and pay employee taxes.

Laws and rules

Occasional Sellers

Almost every seller in Idaho needs a seller’s permit, to collect sales tax, and to send in the tax. However, you don’t need to do that if you qualify for the occasional sales exemption. You can take advantage of this exemption if both of these are true:

  • You don’t make it publicly known that you sell taxable products and services. (You aren’t in the business of selling.)
  • You make only two or fewer sales during any 12-month period (or calendar year for yard sales).

You don’t need to fill out a form or submit any paperwork to the Tax Commission if you qualify for the occasional sales exemption. 

See below for some common sales, like yard sales, and if the exemption applies.

Who can’t use the occasional sales exemption

Almost every other seller is a retailer and needs an Idaho seller’s permit. This includes selling at Idaho events, even if it’s only once in a while.

Here are some common situations where you can’t use the occasional sale exemption:

Yard sales and estate sales

Yard sales (or garage sales) are typically a one-weekend event (three days) where you sell your own items, at your own residence. Holding a yard sale with someone else – whether a family member, neighbor, or friend – counts as a sale for each of you. You can’t have more than two in any calendar year.

You can sell the contents of the house or storage facility for a deceased relative or friend (estate sale) and count it as one of your sales under the occasional sales exemption.

You can’t use the occasional sales exemption if you’re in the business of selling (a retailer), which means you do any of these:

  • Run the sale for more than a few days
  • Sell somewhere other than your own residence
  • Buy items to resell
  • Sell items for someone else (consignment)
  • Sell items at the sale that you also sell at a business you own

Organized sales that charge admission or have two or more sellers who pay to sell at the event are promoter-sponsored events and don’t qualify for the exemption.

Selling and rehoming pets

“Pets” include animals such as dogs, cats, birds, rabbits, guinea pigs, snakes, rats, mice, hamsters, and lizards, among others.

Selling or rehoming a pet would qualify as one sale under the occasional sales exemption if you aren’t in the business of breeding, raising, or selling pets. Selling an unplanned litter or rehoming a litter of strays for a small fee – such as to cover the cost of spaying or neutering – could qualify as an occasional sale. However, selling or rehoming for a substantial fee probably wouldn’t count as an occasional sale.

You can’t use the occasional sales exemption if you’re in the business of selling pets. Instead, you’ll need a seller’s permit, to collect sales tax for each pet you sell, and to send in that tax. However, you don’t need a seller’s permit if you only sell through a registered marketplace facilitator that reports, collects, and sends in Idaho sales tax for you.

Note that you don’t have to collect tax on the sale of animals through 4-H or Future Farmers of America (FFA) at a fair or the spring lamb sale. You also don’t have to collect sales tax on the sale of livestock at a public livestock market. Livestock include cattle, calves, mules, horses, swine, sheep, and goats.

Selling online

The same two-sale limit for the occasional sales exemption applies when you sell online. You could sell a group of your own items at one time and count it as one sale, which would be like an online yard sale. 

You can’t use the occasional sales exemption if you make more than two sales in any 12-month period. You also can’t use this exemption when you’re in the business of selling. That includes if you ever resell items or sell other people’s items for them (consignment).

If you don’t qualify for the occasional sales exemption, you need an Idaho seller’s permit. Or, sell only through registered marketplace facilitators that report, collect, and send in Idaho sales tax for you. You’ll just need to verify that they’re reporting your sales.

Note that the occasional sales exemption never applies to renting out lodging for 30 days or less (short-term rentals). See Hotels, Motels, and Short-Term Lodging and common charges for property and services.

Laws and rules

Sales Tax Exemption Certificate – Real Property Contractors