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Idaho Free Printable Form 85, Small Employer New Jobs Tax Credit and Instructions 2023 for 2024 Idaho Idaho Small Employer New Jobs Tax Credit

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Idaho Small Employer New Jobs Tax Credit
Form 85, Small Employer New Jobs Tax Credit and Instructions 2023

Form 85 Small Employer New Jobs Tax Credit Names as shown on return 2023 Social Security number or EIN Qualifying for the Credit You can claim the small employer new jobs tax credit if you’ve certified on Form 89SE that you’ll meet all the following tax incentive criteria at the project site during the project period: • Capital investment in new plant and building facilities of at least $500,000 • Increased employment by at least 10 new employees, each earning at least $19.23 per hour and receiving health benefits • For new employment increases above the 10 new employees, the average wages of the additional new employees are at least $15.50 per hour worked. See instructions for who’s included in this calculation. If you haven’t filed Form 89SE with the Tax Commission or have been notified that you don’t qualify for the small employer incentives, you don’t qualify for this credit. Credit Available Subject to Limitation 1. The average number of qualifying employees during the tax year ............................................ 2. The average number of qualifying employees during the three preceding tax years ................................................................................. 2 3. The average number of qualifying employees during the preceding tax year ................................................................................... 3 4. Subtract the greater of line 2 or 3 from line 1 and enter the difference. This is the number of qualifying new employees. The amount must equal or exceed one ................... 1 4 5. Number of qualifying new employees listed on line 4 whose annual salary during the tax year the credit was earned was: a. greater than $24.04 per hour worked but equal to or less than an average rate of $28.85 per hour worked ............................................ 5a b. greater than an average rate of $28.85 per hour worked but equal to or less than an average rate of $36.06 per hour worked ............... 5b c. greater than an average rate of $36.06 per hour worked but equal to or less than an average rate of $43.27 per hour worked ............... 5c d. greater than an average rate of $43.27 per hour worked .................. 5d $1,500 Credit 6. Multiply the number on line 5a by $1,500 ................................................................................... 6 $2,000 Credit 7. Multiply the number on line 5b by $2,000 ................................................................................... 7 $2,500 Credit 8. Multiply the number on line 5c by $2,500 ................................................................................... 8 $3,000 Credit 9. Multiply the number on line 5d by $3,000 ................................................................................... 9 10. Add lines 6 through 9. This is your total small employer new jobs tax credit earned this tax year .................................................................................................................... 10 11. Pass-through share of credit from an S corporation, partnership, trust, or estate ...................... 11 12. Credit received through unitary sharing. Include a schedule ............................................................. 12 13. Carryover of small employer new jobs tax credit from prior years .............................................. 13 14. Carryover eliminated due to recapture in 2023. Enter the amount from Form 85R, line 11. Include Form 85R ......................................................................................... 14 15. Credit distributed to shareholders, partners, or beneficiaries ..................................................... 15 16. Credit shared with unitary affiliates ............................................................................................. 16 17. Total credit available subject to limitations. Add lines 10 through 13, then subtract lines 14 through 16 ............................................................................................... 17 EFO00017 09-22-2023  Page 1 of 2 Form 85 2023 (continued) 18. Enter the Idaho income tax from your tax return ........................................................................ 18 19. Credit for income tax paid to other states ................................................ 19 20. Credit for contributions to Idaho educational entities .............................. 20 21. Investment tax credit from Form 49, Part II, line 9 .................................. 21 22. Credit for contributions to Idaho youth and rehabilitation facilities .......... 22 23. Credit for production equipment using post-consumer waste ................. 23 24. Promoter-sponsored event credit ............................................................ 24 25. Credit for Idaho research activities from Form 67, line 29 ....................... 25 26. Broadband equipment investment credit from Form 68, line 18 .............. 26 27. Reserved ................................................................................................. 27 28. Small employer investment tax credit from Form 83, line 28 .................. 28 29. Small employer real property improvement tax credit from Form 84, line 26 ...................................................................................... 29 30. Add lines 19 through 29 .............................................................................................................. 30 31. Tax available after other credits. Subtract line 30 from line 18 ........................................................... 31 32. Multiply line 18 by 62.5% ............................................................................................................ 32 33. Total credit allowed on current year tax return. Enter the smaller amount from lines 17, 31 or 32 here and on Form 44, Part I, line 8 ................................................................ 33 Credit Carryover 34. Total credit available subject to limitations. Enter the amount from line 17 ................................ 34 35. Credit allowed. Enter the amount from line 33 ........................................................................... 35 36. Credit carryover to future years. Subtract line 35 from line 34. Enter the amount here and on Form 44, Part I, line 8 ............................................................................................. 36 EFO00017 09-22-2023  Page 2 of 2 Form 85 — Instructions Small Employer New Jobs Tax Credit General Instructions 2023 • The average number of qualifying employees for the preceding tax year Use Form 85 to calculate the Idaho small employer new jobs tax credit (SE-NJTC) earned or allowed. Each member of a unitary group of corporations that earns or is allowed the credit must complete a separate Form 85. The number of qualifying new employees must be rounded down to the nearest whole number. If the project period began during this tax year and didn’t cover a period of at least nine months, you don’t qualify for the SE-NJTC this year. To determine the credit allowed, each qualifying new employee must be identified based on their annual salary as shown in the following table. Qualifying Taxpayers Carryover Periods To qualify for the SE-NJTC, you must certify by filing Form 89SE that you’ll meet the tax incentive criteria at the project site during the project period. If you haven’t filed Form 89SE with the Tax Commission or you’ve been notified that you don’t qualify for the small employer incentives, you can’t claim this credit. The SE-NJTC earned but not used against tax may be carried forward for 10 tax years. For purposes of the carryover period, a short tax year counts as one tax year. Credit Rates If the annual salary is greater than... But equal to or less than an average rate of... Then the credit earned is... Qualifying New Employees for the SE-NJTC $24.04 per hour $28.85 per hour $1,500 To qualify for the credit, the new employee must: • Qualify as a new employee for purposes of the small employer tax incentive criteria discussed above • Earn more than $24.04 per hour worked and • Have worked a minimum of nine months during the tax year in which the credit is claimed An average rate of $28.85 per hour $36.06 per hour $2,000 An average rate of $36.06 per hour $43.27 per hour $2,500 Calculating the Credit Use the Employer Quarterly Unemployment Insurance Tax Reports and the Unemployment Insurance Wage Reports filed with the Idaho Department of Labor to compute the number of employees. Only those employees who meet the definition of “new employee” can be included when computing the SE-NJTC. Don’t include any employees who don’t work primarily at the project site. Keep records to support the computations. The number of employees employed primarily at the project site during a tax year is the average of the number of employees reported to the Idaho Department of Labor during the 12 months of the tax year. If the project period began during the tax year, the number of employees for the year is the average number actually employed during the months of the project period. You can’t earn the credit if the project period didn’t cover at least nine months during the first tax year. These employees may qualify for the credit the next year. The number of qualifying new employees is the increase in the number of qualifying employees for the current tax year over the greater of the following: • The average number of qualifying employees for the three preceding tax years or EIN00017 09-22-2023  An average rate of $43.27 per hour $3,000 Recapture Compute recapture if you don’t maintain the required level of qualified new employees for five full years from the date the project period ends. Also, compute recapture if you claimed the SE-NJTC in an earlier year and don’t meet the tax incentive criteria you certified to on Idaho Form 89SE. If you claimed the SE-NJTC and recapture is now required, file Form 85R. Specific Instructions Instructions are for lines not fully explained on the form. Credit Available Subject to Limitation Line 1. Determine the average number of qualifying employees during the tax year by adding the number of qualifying employees reported for each month on your Idaho Employer Quarterly Unemployment Insurance Tax Reports and dividing that amount by the number of months of operation during the tax year. Don’t include any employees who weren’t employed primarily at the project site. Line 2. Determine the average number of qualifying employees during the three preceding tax years by dividing the total of the average number of qualifying employees reported on your Idaho Employer Quarterly Unemployment Insurance Tax Reports for Page 1 of 2 Form 85 — Instructions 2023 (continued) each preceding year by three. If the project period existed less than three tax years, use the number of tax years in operation. member of the combined group. The schedule must clearly identify shared credit and the computation of any credit carryovers. Line 3. Determine the average number of qualifying employees during the preceding tax year by adding the number of qualifying employees reported for each month on your Idaho Employer Quarterly Unemployment Insurance Tax Reports and dividing that amount by the number of months of operation during the preceding tax year. Enter zero if the project period covered less than nine months the preceding tax year. Credit Limitations Line 4. No credit is allowed unless the number on this line equals or exceeds one. If it’s more than one, the number is rounded down to the nearest whole number. Line 5. To compute lines 5a through 5d, identify each individual who’s a qualifying new employee and the annual average salary that the individual earned during the tax year. Enter the number of qualifying new employees according to their annual salary earned for the tax year. The amounts listed on lines 5a through 5d can’t exceed the number on line 4. Line 11. Enter the amount of the SE-NJTC that’s being passed through by S corporations, partnerships, trusts, or estates in which you have an interest. Report this amount on Form ID K-1, Part VII, line 44 or Form ID K-1, Part XI, line 68 (Composite/ABE). The SE-NJTC is limited to the smaller of 62.5% of the tax liability or the Idaho income tax after allowing all other tax credits that may be claimed before the SE-NJTC. The following credits must be applied to the tax before the SE-NJTC: 1. Credit for income tax paid to other states 2. Credit for contributions to Idaho educational entities 3. Investment tax credit 4. Credit for contributions to Idaho youth and rehabilitation facilities 5. Credit for production equipment using post-consumer waste 6. Promoter-sponsored event credit 7. Credit for Idaho research activities 8. Broadband equipment investment credit 9. Small employer investment tax credit 10. Small employer real property improvement tax credit Line 18. 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 12. If you’re a member of a unitary group, enter the amount of credit you received from another member of the unitary group. Line 19. Enter the credit for income tax paid to other states from Forms 39R, 39NR, or 66. This credit is available only to individuals, trusts or estates. Line 13. Enter the carryover from your 2022 Form 85, line 36. Line 33. Enter the smallest amount from lines 17, 31, or 32 on line 33. Enter this amount on Form 44, Part I, line 8 in the Credit Allowed column. Line 15. If you’re an S corporation, partnership, trust, or estate, enter the amount of credit that passed through to shareholders, partners, or beneficiaries. Line 16. If you’re a member of a unitary group, enter the amount of credit you earned 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 the tax liability. Corporations claiming the SE-NJTC must provide a calculation of the credit earned and used by each If you’re an S corporation or partnership and you’ve elected to be an ABE, this amount also needs to be distributed to the shareholders or partners on their Form ID K-1. Credit Carryover Line 36. The amount of credit available that exceeds the total credit allowed on the current year tax return may be carried forward up to 10 tax years. Enter this amount on Form 44, Part I, line 8 in the Carryover column. Contact us: In the Boise area: (208) 334-7660 | Toll free: (800) 972-7660 Hearing impaired (TDD) (800) 377-3529 tax.idaho.gov/contact EIN00017 09-22-2023  Page 2 of 2
Extracted from PDF file 2023-idaho-form-85.pdf, last modified September 2023

More about the Idaho FORM 85 Corporate Income Tax Tax Credit TY 2023

We last updated the Idaho Small Employer New Jobs Tax Credit in February 2024, so this is the latest version of FORM 85, fully updated for tax year 2023. You can download or print current or past-year PDFs of FORM 85 directly from TaxFormFinder. You can print other Idaho tax forms here.

Related Idaho Corporate Income Tax Forms:

TaxFormFinder has an additional 65 Idaho income tax forms that you may need, plus all federal income tax forms. These related forms may also be needed with the Idaho FORM 85.

Form Code Form Name
FORM 850-U (obsolete) Idaho Self-Assessed Use Tax Worksheet and Return
FORM 850 Instructions for Form 850 - Idaho Sales and Use Tax
FORM 85R Recapture of Idaho Small Employer New Jobs Tax Credit

Download all ID tax forms View all 66 Idaho Income Tax Forms


Form Sources:

Idaho usually releases forms for the current tax year between January and April. We last updated Idaho FORM 85 from the State Tax Commission in February 2024.

Show Sources >

FORM 85 is an Idaho Corporate Income Tax form. States often have dozens of even hundreds of various tax credits, which, unlike deductions, provide a dollar-for-dollar reduction of tax liability. Some common tax credits apply to many taxpayers, while others only apply to extremely specific situations. In most cases, you will have to provide evidence to show that you are eligible for the tax credit, and calculate the amount of the credit to which you are entitled.

About the Corporate Income Tax

The IRS and most states require corporations to file an income tax return, with the exact filing requirements depending on the type of company.

Sole proprietorships or disregarded entities like LLCs are filed on Schedule C (or the state equivalent) of the owner's personal income tax return, flow-through entities like S Corporations or Partnerships are generally required to file an informational return equivilent to the IRS Form 1120S or Form 1065, and full corporations must file the equivalent of federal Form 1120 (and, unlike flow-through corporations, are often subject to a corporate tax liability).

Additional forms are available for a wide variety of specific entities and transactions including fiduciaries, nonprofits, and companies involved in other specific types of business.

Historical Past-Year Versions of Idaho FORM 85

We have a total of eleven past-year versions of FORM 85 in the TaxFormFinder archives, including for the previous tax year. Download past year versions of this tax form as PDFs here:


2023 FORM 85

Form 85, Small Employer New Jobs Tax Credit and Instructions 2023

2022 FORM 85

Form 85, Small Employer New Jobs Tax Credit and Instructions 2022

2021 FORM 85

Form 85, Small Employer New Jobs Tax Credit and Instructions 2021 approved

2020 FORM 85

Form 84R, Recapture of Idaho Small Employer Real Property Improvement Tax Credit and Instructions

2019 FORM 85

Form 85, Small Employer New Jobs Tax Credit and Instructions

2017 FORM 85

Form 85 - Idaho Small Employer New Jobs Tax Credit

2016 FORM 85

Form 85 - Idaho Small Employer New Jobs Tax Credit


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