49R: Recapture of Idaho Investment Tax Credit and Instructions 2024 (2024)
Idaho · Idaho Tax Commission · Used for tax years 2024
Idaho Form 49R calculates the increase in tax and reduction in credit carryover from recapture of the investment tax credit. It reports property that no longer qualifies, the original credit, and any recapture amounts passed through to or from shareholders, partners, or beneficia
Who files this form
Use Form 49R to figure the increase in tax and reduction in credit carryover from recapturing Idaho investment tax credit (ITC).
You must recompute the credit if you earned it in an earlier year and:
- Disposed of the property before the end of the five-year recapture period.
- Have property that no longer qualifies for ITC. Property moved out of Idaho within the first five years no longer qualifies and is subject to recapture.
Recapture may also be necessary when a shareholder’s interest in an S corporation, a partner’s interest in partnership profits or particular property, or an interest in trust or estate income is reduced.
S corporations, partnerships, trusts, and estates with credit subject to recapture must complete lines 1 through 9. Shareholders, partners, and beneficiaries report their pass-through share on line 10. If you have only pass-through recapture, skip lines 1 through 9.
What you'll need
Have the following information and schedules ready:
- Names as shown on your return and your Social Security number or EIN.
- A detailed schedule describing each property that no longer qualifies.
- For each property, the date it was first available for service, the cost or other basis used for the original credit, and the date it stopped qualifying.
- An additional Form 49R or a schedule with the same information if more than five items are subject to recapture.
- Form ID K-1 if recapture was passed through to you. The amount is reported in Part X, line 56, or Part XI, line 70 (ABE).
- A separate sheet computing any unused portion of the original credit entered on line 13.
Entities passing ITC through to shareholders, partners, or beneficiaries must provide Form ID K-1 showing the recapture amount. They must also include details about the years the credit was originally earned in Part XII, Supplemental Information.
Common mistakes
- Counting partial years on line 6. Enter only full years. If you held the property for less than 12 months, enter zero.
- Leaving out recapture from additional sheets. Include it in line 9. Write “tax from attached” and the total tax from the separate sheets to the left of the entry space.
- Including certain composite-return amounts on line 12. Do not include recapture for shareholders, partners, or beneficiaries whose tax you are paying on a composite return.
- Entering too much unused credit on line 13. Do not enter more than line 11. Report this amount on Form 49C to reduce the credit carryover available to the current year.
- Using line 15 to reduce current-year ITC. Instead, enter the recapture tax on Form 44, Part II, line 1. Do not use it to reduce the current year’s credit computed on Form 49.
Questions people ask
What recapture percentage should I use?
Use the number of full years on line 6: zero years means 100%; one year, 80%; two years, 60%; three years, 40%; four years, 20%; and five or more years, 0%.
Do I owe recapture tax on credit I never used?
You do not have to pay recapture tax on the unused portion of the original credit. Compute that portion on a separate sheet and enter it on line 13, up to the amount on line 11. Recapture of credit not claimed in prior years reduces the credit carryover available to the current year.
What if my only recapture comes from a pass-through entity?
Skip lines 1 through 9 and begin on line 10. Use the recapture information provided by the S corporation, partnership, trust, or estate.
What if my S corporation or partnership elected to be an ABE?
The increase in tax on line 15 must also be distributed to shareholders or partners on their Form ID K-1.