Idaho · Investment · ID-ITC-001
Investment Tax Credit
Publication revised September 24, 2026. Sourcebook page 94.
Credit amount / calculation
3% of qualifying investment, subject to current use limits and carryforward.
Business fit and eligible activity
Broad statutory credit for qualified Idaho investment, including many depreciable manufacturing assets. Qualified investment or approved project activity; confirm eligible property, location and taxpayer type.
Eligibility and practical use
This is the kind of credit that can matter to a capital-intensive mill even when the project adds only a handful of jobs. Logging equipment deserves a separate eligibility check because mobile harvesting property may be treated differently from machinery used at a manufacturing site.
Illustrative business benefit
A sawmill invests $1.50 million in qualifying production machinery. At 3%, the nominal credit is $45,000 before annual caps, tax-liability limits, carryforward rules, or negotiated adjustments. The company should isolate eligible machinery from buildings, vehicles, land, and other costs that the statute does not treat the same way.
Timing / first action
Tax-year claim: document the eligible expense, hire or placed-in-service date and meet any separate certification deadline. Get a written answer on which property is qualified - especially buildings, installation, software, used equipment, vehicles, and mobile machinery.
Official sources
- Idaho State Tax Commission — 2025 (tax.idaho.gov)
Related programs
Idaho Business Advantage Credits
generally
Qualifying expansions meeting investment, jobs, wage and benefit tests can receive enhanced tax credits.
Research Activities Credit
5% of qualifying Idaho research expenditures over the base
Qualifying Idaho research can generate a state credit.
Tax Reimbursement Incentive
Up to
Substantial expansions can negotiate a refundable credit based on new state tax revenues.
Clean Electricity Investment Credit (Internal Revenue Code §48E)
Generally
Potentially relevant when a forest-products facility owns qualifying zero-emission generation or energy-storage property.
Clean Electricity Production Credit (Internal Revenue Code §45Y)
Production-based
Alternative to the investment credit for owners/operators of qualifying clean-electricity facilities; potentially relevant to qualifying on-site generation.
Credit for Increasing Research Activities (Internal Revenue Code §41)
Regular research-credit method
A sawmill, secondary manufacturer or biomass business can qualify when it performs genuine technological experimentation to improve a product or process.