49: Investment Tax Credit and Instructions 2025 (2025)
Idaho · Idaho Tax Commission · Used for tax years 2025
Idaho Form 49 calculates the investment tax credit earned or allowed for 2025. It reports qualified investments, pass-through amounts, credit carryovers, and the limitation on the credit you can claim.
Who files this form
Use Form 49 to calculate the Idaho investment tax credit (ITC) earned or allowed for tax year 2025.
Each member of a unitary group of corporations that earns or is allowed the credit must complete a separate Form 49.
Qualified property must have a useful life of at least three years and be property you’re allowed to depreciate or amortize. Qualifying business property includes machinery and equipment and certain other property listed in the instructions.
What you'll need
Have your Idaho income tax return figures available, along with the following records and attachments that apply to you:
- Detailed property list: Include each qualifying item acquired and placed in service during the tax year, its location, your basis, whether it is new or used, and its placed-in-service date. Use Idaho adjusted basis without bonus depreciation.
- Form 49E copies: Include applicable forms for investments on which you claimed the property tax exemption.
- Pass-through information: Include a list identifying each S corporation, partnership, trust, or estate by name and EIN, plus your share of new and used qualified investments. This information is reported on Form ID K-1, Part X.
- Carryover calculation: For Part I, line 8a, include Form 49C or a separate schedule computing the carryover.
- Sharing schedules: Include the required schedules for credit received through unitary sharing or from a co-op, and amounts shared with unitary affiliates. Corporations claiming ITC must provide a detailed schedule showing each combined-group member’s name, EIN, and ITC used, including shared investments and carryover calculations.
- Form 49ABE: Include this form for the ABE investment tax credit entered in Part II, line 9.
Common mistakes
- Claiming both tax benefits for the same property: You can’t claim ITC on property you elect to exempt from property tax.
- Including excluded costs: Don’t include property costs expensed under IRC section 179. Compute the Idaho adjusted basis without bonus depreciation.
- Exceeding the used-property limit: Part I, line 3, Column B is limited to $150,000.
- Including personal or out-of-state use: The personal-use portion and property not used in Idaho don’t qualify. For property used both in and outside Idaho, use one of the allocation methods in the instructions.
- Missing recapture: Compute recapture if you sell or otherwise dispose of property, or it stops qualifying, before five full years of service. File Form 49R if you claimed ITC or Form 49ER if you claimed the property tax exemption.
- Sharing credit too soon: Before sharing credit with unitary affiliates, you must use it up to the allowable limitation of your own tax liability.
Questions people ask
How is the credit earned calculated?
Multiply the total available qualifying investments in Part I, line 5, Columns A and B, by 3%. The amount you can use is subject to the limitation calculated in Part II.
How much credit can I use on my 2025 return?
Part II, line 10 adds the ABE investment tax credit on line 9 to the smallest of lines 6, 7, or 8. Those three lines represent tax available after the listed credits, 50% of Idaho income tax after the credit for income tax paid to other states, and ITC available. Enter the allowed amount on Form 44, Part I, line 1, in the Credit Allowed column.
Can I carry unused credit forward?
Yes. Credit available that exceeds the credit allowed on the current-year return can be carried forward up to 14 tax years. A short tax year counts as one tax year. Enter the carryover on Form 44, Part I, line 1, in the Carryover column.
Can I choose a property tax exemption instead?
You may elect a two-year property tax exemption for qualifying personal property if you had negative Idaho taxable income in the second preceding tax year, computed without net operating loss carryovers or carrybacks. You aren’t eligible if federal or state law regulates or limits your rate of charge or return. Make the election on Form 49E. You can’t also claim ITC for that property.