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ID H0382
Bill
AI Summary
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Defines "pass-through entity" to include partnerships, limited liability companies taxed as partnerships, S corporations, and trusts or estates required to file returns in Idaho.
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Allows individuals who are owners of pass-through entities or beneficiaries of trusts or estates to elect to have Idaho income tax reported and paid by the entity at corporate tax rates instead of on individual returns.
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Establishes a backup withholding system requiring pass-through entities to withhold taxes at the highest marginal individual rate on income of owners and beneficiaries who do not make an election to have taxes paid by the entity.
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Exempts Idaho residents and individuals who make a timely election under the first provision from the backup withholding requirement.
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Requires pass-through entities to file withholding returns with the state tax commission and furnish statements to affected individuals showing amounts withheld; effective January 1, 2011.
Legislative Description
Adds to and amends existing law relating to state income taxes to provide definitions of the terms "pass-through entity" and "owner of interest in a pass-through entity"; to revise the manner in which the income of pass-through entities income is reported and paid; and to provide a system of backup withholding for individuals who are owners of pass-through entities or beneficiaries of a trust or estate who do not elect to have their income taxes paid on the entity's return.
STATE TAX COMMISSION
Last Action
Governor signed Session Law Chapter 37 Effective: 01/01/11
3/5/2010