Tax Filing Tips from the Idaho State Tax Commission

BOISE, Idaho (News Release) – If you’re gathering information to file your 2015 Idaho individual income tax return, don’t forget those untaxed purchases you made last year.

If you didn’t pay sales tax when you bought the merchandise, you owe a 6 percent use tax if the goods were used, given away, stored or consumed in Idaho.

For example, when shoppers buy goods on the Internet, by telephone or from a mail-order catalog, sellers might not charge sales tax if they’re not Idaho retailers. The shoppers are responsible for paying tax directly to the Idaho State Tax Commission. And those who buy merchandise in a state where no sales tax is charged – such as Oregon or Montana – owe use tax if they bring the goods into Idaho.

Check your invoices or receipts to see whether sales tax was collected on the following types of purchases:

• Merchandise bought over the Internet (including digital music, movies, books, games, etc.)
• Magazine subscriptions
• Book and music clubs
• Catalog purchases
• Purchases in a state where no sales tax is charged (e.g., Oregon, Montana)

If sales tax wasn’t collected, Idaho makes it easy for you to pay your use tax when you file your annual income tax return, which is due by Monday, April 18, this year. Simply total your untaxed purchases, multiply that total by .06, and enter that amount (rounded to the nearest dollar) on the appropriate line of your income tax return (see below):

• Full-year residents who file Form 40 (Idaho Individual Income Tax Return) can pay their use tax on line 28 of the tax return.
• Part-year residents can pay use tax on line 48 of Form 43 (Idaho Part-Year Resident & Nonresident Income Tax Return).
• You can also fill out Form 850-U (Idaho Self-Assessed Use Tax Worksheet and Return), available at the Idaho State Tax Commission, and pay use tax at any time during the year.

Sales and use taxes help fund state and local services throughout Idaho and the use tax ensures that all consumers in the state contribute fairly to the funding of these services, whether they choose to make purchases in Idaho, online, or outside the state.

“Use tax is an important tool to make sure that Idaho retailers can compete fairly with out-of-state companies that don’t collect sales tax,” said Randy Tilley, the Idaho State Tax Commission’s Audit Division administrator.

Last year, nearly 11,000 Idahoans paid use tax totaling more than $700,000 with their 2014 income tax returns.