Idaho Idaho Investment Tax Credit

Idaho Investment Tax Credit
Form 49, Investment Tax Credit and Instructions 2023
Form 49
Investment Tax Credit

2023

Names as shown on return

Social Security number or EIN

Part I — Credit Available Subject to Limitation
Column A - New

Column B - Used

1. a. Amount of qualified investments acquired during the tax year.
Include a detailed list .............................................................................. 1a
b. Amount of investments you claimed the property tax exemption on.

Include applicable Form 49Es ................................................................... 1b 
c. Subtract line 1b from line 1a. This is the amount of qualified

investments you can earn the investment tax credit (ITC) on .................... 1c



2. Pass-through share of qualified investments from an S corporation, partnership, trust, or estate:
a.
Pass-through Entity Name

b.
Pass-through Entity EIN

c.
Pass-through Share

Total column c ............................
3. Total qualified investments. Add lines 1c and 2
(Column B is limited to $150,000) ..................................................................

2
3

4. Amount distributed to shareholders, partners, or beneficiaries ......................

4

5. Total available qualifying investments. Line 3 minus line 4 ............................

5

6. Credit earned. Multiply the sum of line 5 Columns A and B by 3% ......................................................... 6
7. a. Pass-through credit from ABE – Taxpayers not distributing the credit. See instructions ................... 7a
b. Pass-through credit from ABE – Taxpayers distributing the credit. See instructions ......................... 7b
8. a. Carryover of ITC from prior years – Taxpayers not distributing the carryover. See instructions ......... 8a
b. Carryover of ITC from prior years – Taxpayers distributing carryover. See instructions ..................... 8b
9. Amount received through unitary sharing or from a co-op. Include a schedule .................................... 9
10. Amount shared with unitary affiliates. Include a schedule .................................................................... 10
11. Total credit available. Add lines 6, 7a, 8a, and 9, then subtract line 10 .................................................. 11

Part II — Limitation
1. Enter the Idaho income tax from your return ..........................................................................................

1

2. Credit for income tax paid to other states ............................................................................................... 2
3. Idaho income tax after credit for income tax paid to other states. Line 1 minus line 2 ...........................

3

4. Credit for contributions to Idaho educational entities .............................................................................. 4
5. Tax available after credits. Line 3 minus line 4 ...............................................

5

6. 50% of tax after credit for income tax paid to other states. Multiply line 3 by 50% 6
7. Investment tax credit available. Enter the amount from Part I, line 11 ............ 7
8. ABE Investment Tax Credit. Include Form 49ABE .......................................... 8
9. Investment tax credit allowed. Add the amount from line 8 to the smallest amount from lines 5, 6, or 7.
Enter here and on Form 44, Part 1, line 1 ............................................................................................... 9
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Form 49 — Instructions
Investment Tax Credit
General Instructions
Use Form 49 to calculate the investment tax
credit (ITC) earned or allowed. Each member
of a unitary group of corporations that earns or
is allowed the credit must complete a separate
Form 49.
Qualified Depreciable Property and
Nonqualifying property
Idaho generally follows the definition of qualified
property found in the Internal Revenue Code
(IRC) sections 46 and 48 as in effect before
1986. The property must have a useful life of
three years or more and be property that you’re
allowed to depreciate or amortize. Qualifying
property includes the following property used in
a trade or business:
•	 Tangible personal property – machinery and
equipment
•	 Other tangible property
ƒ	 Property used as an integral part of
manufacturing, production, extraction,
or
ƒ	 Furnishing transportation,
communications, or utility services, or
ƒ	 Research facilities and bulk storage
facilities used in connection with those
businesses
•	 Elevators and escalators
•	 Single-purpose agricultural or horticultural
structures
•	 Qualified timber property
•	 Petroleum storage facilities
•	 Qualified broadband equipment as approved
by the Idaho Public Utilities Commission
Nonqualified Property
Property that doesn’t qualify includes:
•	 Buildings and their structural components
•	 Property used in lodging facilities that
rent 50% or more of their lodging units
for periods of 30 days or longer, such as
apartment houses or rental homes
•	 The cost of property expensed under IRC
section 179
•	 Used property not acquired by purchase

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•	 The portion of property used for personal use
•	 Used property in excess of $150,000 (total
•	
•	
•	

•	

of all properties)
Horses
Property not used in Idaho
Vehicles under 8,000 pounds gross vehicle
weight (GVW)
Property previously used by the same taxpayer
or an affiliate of the taxpayer

Property Used Both In and Outside Idaho
If property is used both in and outside Idaho,
compute the qualified investment for all such
property using one of the following methods:
1.	 Percentage-of-Use Method – Multiply the
investment in each asset by a fraction where
Idaho use is the numerator and total use is
the denominator. Use can be measured by
machine hours, mileage, or any other method
that accurately reflects the use.
2.	 Property Factor Numerator Method – Use the
amount correctly included in the Idaho property
numerator for each asset.
The amount computed in method #2 generally will
be the same as that computed in method #1 unless
your business uses the Multistate Tax Commission’s
special-industry regulations to compute its factors.
Carryover Periods
Compute the ITC carryover on Form 49C.
•	 For credit earned in tax years beginning on or
after January 1, 2000, the credit carryover is
limited to 14 tax years.
For purposes of the carryover period, a short tax
year counts as one tax year.
Election to Claim Two-Year Property Tax
Exemption Instead of ITC
If you placed personal property in service that
qualifies for the ITC, you may elect to exempt this
property from your property tax. If federal or state
law regulates or limits your rate of charge or rate
of return, you aren’t eligible for the election. The
exemption from the property tax is for two years.
After the two years, you must pay any applicable
property tax. You can’t claim the ITC for any
property that you elect to exempt from property tax.

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Form 49 — Instructions

The election is available if you had negative
Idaho taxable income in the second preceding
tax year from the tax year when the property was
placed in service. Negative Idaho taxable income
must have been computed without any carryover
or carryback of net operating losses.
Make the election on Form 49E and file with
the operator’s statement or personal property
declaration. Include a copy of the election form
with the original income tax returns for the tax
years when the property was placed in service.
Recapture
Compute recapture if you sell or otherwise
dispose of the property, or if it no longer qualifies
for the ITC before it’s been in service for five
full years. File Form 49R if you claimed the ITC.
File Form 49ER if you claimed the property tax
exemption.

Specific Instructions
Instructions are for lines not fully explained on the
form.
Part I — Credit Available Subject to Limitation
Line 1a. Include a list of all property you
acquired and placed in service during the tax
year that qualifies for the ITC. The list should
identify:
•	 Each item of property and its location
•	 Your basis in the item
•	 Whether the item is new or used, and
•	 The date placed in service
The basis of qualified property is the Idaho
adjusted basis computed without bonus
depreciation. Don’t include any property you’re
expensing under IRC section 179.
Column A
Enter the amount of qualified new investments
placed into service in the current year.
Column B
Enter the amount of qualified used investments
placed into service in the current year.
Line 1b. This exemption is allowed instead of
earning the ITC. Include applicable Form 49Es.
Column A
Enter the amount of qualified new investments
you claimed the property tax exemption on.
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(continued)

Column B
Enter the amount of qualified used investments
you claimed the property tax exemption on.
Line 2. Include a list of all ITC that’s being passed
through by S corporations, partnerships, trusts, or
estates that you have an interest in. This amount
is reported on Form ID K-1, Part X. Identify each
entity by name, EIN, and the share of new and used
qualified investments being passed through.
Line 3. Used property is limited to $150,000. If
the total qualified used investments is greater than
$150,000, enter $150,000 in Column B.
Line 4. If you’re an S corporation, partnership,
trust, or estate:
Column A
Enter the amount of qualified new investments
that passed through to shareholders, partners,
or beneficiaries reported on Form ID K-1, Part X,
line 54.
Column B
Enter the amount of qualified used investments
that passed through to shareholders, partners,
or beneficiaries reported on Form ID K-1, Part X,
line 55.
Line 7a. Enter the amount of credit passed through
from an ABE that is not being distributed to other
taxpayers.
•	 Individuals and C corporations
▪	 Enter the amount of credit passed through
from an ABE
•	 Trusts and Estates
▪	 Enter the amount of credit passed through
from an ABE that is not being distributed
to beneficiaries
•	 S corporations or partnerships
(Composite Return)
▪	 Enter the amount of credit passed through
from an ABE that is not being distributed
Line 7b. Enter the amount of credit passed through
from an ABE that is being distributed to other
taxpayers.
•	 Trusts and Estates
▪	 Enter the amount of credit passed through
from an ABE that is being distributed to
beneficiaries

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Form 49 — Instructions

•	 S corporations or partnerships
(Composite Return)
▪	 Enter the amount of credit passed through
from an ABE that is being distributed to
resident shareholders or partners
•	 Non ABE and Non Composite S corporations
or partnerships
▪	 Enter the amount of credit passed through
from an ABE that is being distributed to
shareholders or partners
Line 8a. Enter the ITC carryover from prior
years not being distributed to other taxpayers.
Compute the amount on Form 49C or on a
separate schedule. Include a copy of Form 49C or
the schedule. See General Instructions for the
carryover period allowed.
•	 Individuals, trusts, estates, or C corporations
▪	 Enter the amount of the ITC carryover
from prior years
•	 S corporations or partnerships
(Composite Return)
▪	 Enter the amount of the ITC carryover
from prior years
Line 8b. Enter the ITC carryover from prior years
being distributed to other taxpayers.
•	 Non ABE and Non Composite S corporations
or partnerships
▪	 Enter the amount of the ITC carryover
from prior ABE or composite years to be
distributed to shareholders or partners

2023

(continued)

Corporations claiming ITC must provide a detailed
schedule showing the name, EIN, and amount
of ITC used by each member of the combined
group. The schedule must clearly identify shared
investments and the computation of any credit
carryovers.
Part II — Limitation
The ITC is limited to the smallest of the following:
•	 50% of your Idaho income tax after credit for
taxes paid to other states
•	 Tax available after credit for taxes paid to
other states and credit for contributions to
Idaho educational entities
•	 ITC available
Line 1. Enter the amount of your Idaho income
tax. This is the computed tax before adding the
permanent building fund tax or any other taxes,
or subtracting any credits.
Line 2. Enter the credit for income tax paid to
other states from Form 39R or Form 39NR. This
credit is available only to individuals, trusts, and
estates.
Line 9. Enter the smallest amount from lines 5,
6, or 7 plus the amount from line 8. Carry this
amount to Form 44, Part I, line 1, and enter it in
the Credit Allowed column.
The amount of credit available that exceeds the
total credit allowed on the current year tax return
can be carried forward up to 14 tax years. Enter this
on Form 44, Part I, line 1 in the Carryover column.

Line 9. If you’re a member of a unitary group, enter
the amount of credit you received from another
member of the unitary group. Include a schedule
detailing the entity name, EIN, and amount of ITC
received.
Line 10. If you’re a member of a unitary group,
enter the amount of qualifying investments that you
elect to share with other members of your unitary
group. Before you can share your credit, you must
use the credit up to the allowable limitation of your
tax liability.

Contact us:

In the Boise area: (208) 334-7660 | Toll free: (800) 972-7660
Hearing impaired (TDD) (800) 377-3529
tax.idaho.gov/contact
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