Idaho Administrative Code › Title IDAPA 35 - Tax Commission, State › Rule 35.01.01 - INCOME TAX ADMINISTRATIVE RULES › Section 35.01.01.714 - IDAHO INVESTMENT TAX CREDIT: CREDIT EARNED ON PROPERTY USED BOTH IN AND OUTSIDE IDAHO IN TAXABLE YEARS BEGINNING ON OR AFTER JANUARY 1, 1995

Current through August 31, 2023
Section
				63-3029B, Idaho Code
01.
In General
. Property must be
			 used at least part of the time in Idaho to qualify for the investment tax
			 credit, provided it otherwise qualifies for the credit. It must also be used in
			 Idaho in each taxable year during the recapture period. (4-6-23)
02.
Election of Methods
. The
			 taxpayer must elect to compute the investment tax credit on property used both
			 in and outside Idaho using either the percentage-of-use method or the amount of
			 that property correctly included in the Idaho property factor numerator. The
			 credit for all property used both in and outside Idaho must be computed using
			 the method elected. (4-6-23)
a.
			 Percentage-of-Use Method. If the percentage-of-use method is elected, the basis
			 of each qualified asset is multiplied by the percentage of time, miles, or
			 other measure that accurately reflects the use of that asset in Idaho. The use
			 of aircraft within and without Idaho during the taxable year will be determined
			 by the ratio of departures from locations in Idaho to total departures.
			 (4-6-23)
b. Property Factor Method.
			 If the property factor numerator option is elected, the qualified investment is
			 the basis of the asset correctly included in the numerator of the Idaho
			 property factor for the year the credit is earned. (4-6-23)
i. The amounts of investment tax credit
			 computed under the percentage-of-use method and the property factor numerator
			 option are generally the same. Differences may result when a taxpayer uses
			 certain MTC special industry regulations that allow the taxpayer to vary from
			 using the percentage-of-use method for determining the Idaho numerator for each
			 item of mobile property, and instead allow another method, such as the ratio of
			 mobile property miles in the state compared to total mobile property miles or
			 the ratio of departures of aircraft from locations in the state compared to
			 total departures. These special industry regulations include the regulations
			 for airlines, railroads, and trucking companies. See Rule
			 580 of these rules for a list of
			 the special industries. (4-6-23)
ii. "Correctly included in the numerator of
			 the Idaho property factor" means that the amount included in the Idaho property
			 factor numerator was correctly computed using Section
			 63-3027, Idaho Code, and related
			 rules including any MTC special industry regulations that apply to the
			 taxpayer. If the amount included in the Idaho property factor numerator exceeds
			 the amount that should have been included using Section
			 63-3027, Idaho Code and related
			 rules, the investment tax credit will be allowed only on the amount that
			 reflects the correct calculation for purposes of computing the Idaho property
			 factor numerator. For example, a taxpayer includes one hundred percent (100%)
			 of the basis of an asset in the Idaho property factor numerator, but the amount
			 correctly computed under Section
			 63-3027, Idaho Code, should have
			 been fifty percent (50%) of the basis of the asset. The investment tax credit
			 will be allowed only on the fifty percent (50%) of the basis of the asset.
			 (4-6-23)