Idaho Investment Tax Credit Form 49

Idaho Investment Tax Credit Form 49

Form 49 is used by taxpayers in Idaho to calculate the Investment Tax Credit (ITC) earned or allowed. This credit is available to individuals, corporations, trusts, estates, and partnerships who make qualifying investments in property placed in service during the tax year. The form helps determine the amount of credit that can be claimed, subject to limitations based on Idaho income tax liability.

Who Must File Form 49?

• Individuals, C corporations, S corporations, partnerships, trusts, and estates that have made qualifying investments in Idaho.
• Each member of a unitary group of corporations must complete a separate Form 49.
• Entities claiming the ITC must provide a detailed schedule showing the name, EIN, and amount of ITC used by each member of the combined group.

How to Calculate the Investment Tax Credit

The ITC is calculated based on qualified investments made during the tax year. The credit is limited to the smallest of the following:

• 50% of your Idaho income tax after credit for taxes paid to other states.
• The amount of credit available from qualified investments.
• Any carryover from prior years (up to 14 years).

Key steps in the calculation:

• Line 1a: Enter the amount of qualified new investments placed in service during the tax year.
• Line 1b: Enter the amount of investments for which you claimed property tax exemption (Form 49ES).
• Line 1c: Subtract line 1b from line 1a to determine the amount eligible for ITC.
• Line 2: Enter credit for income tax paid to other states (from Form 39R or Form 39NR).
• Line 5: Enter credit for contributions to Idaho educational entities.
• Line 8a & 8b: Enter ITC carryover from prior years, either not being distributed or being distributed to other taxpayers.
• Line 9: If part of a unitary group, enter credit received from another member.
• Line 10: Add the smallest amount from lines 6, 7, or 8 to line 9. This is the credit allowed. Carry this amount to Form 44, Part I, line 1.

Special Rules for Pass-Through Entities

• S corporations and partnerships (composite returns) must report credit passed through from an ABE (Alternative Business Entity) that is not being distributed.
• Credit passed through from an ABE that is being distributed must be reported on Form ID K-1, Part XI, line 60.
• Trusts and estates must report credit passed through from an ABE that is not being distributed to beneficiaries.

Carryover and Limitations

• The ITC is limited to 50% of Idaho income tax after credits for taxes paid to other states.
• Any unused credit can be carried forward up to 14 tax years.
• The carryover amount is reported on Form 44, Part I, line 1 in the Carryover column.

Filing Instructions via OLT Software

To add Form 49 (Investment Tax Credit) using OLT (Online Taxes) software:

1. From within your tax return (Online), click on State in the left menu (or tap three dots on mobile).
2. Select Start or Revisit Idaho state.
3. Under the Credits section, click Start or Revisit next to Investment Tax Credit (Form 49).
4. Follow on-screen instructions to complete the form.

Note: The form requires detailed information about each item of qualified property, including its location, basis, whether it is new or used, and the date placed in service. Bonus depreciation is not included in the basis calculation.

Source:

Form 49-Investment Tax Credit

Disclaimer: Always verify with official Federal or State Department of Revenue Forms and Instructions for the most accurate and up-to-date information.