By Consumer Reporter
MILLIONS of Americans will now get to keep up to $31,500 of their wage-based income in their pockets, exempt from taxes thanks to recently passed legislation.
One state has mirrored the increased federal standard deduction, permitting residents to automatically shelter a good portion of their earnings from the state personal income tax.
Governor Brad Little signed Idaho’s income tax conformity legislation, House Bill 559, on February 11, implementing the majority of the provisions outlined in the federal One Big Beautiful Bill Actthat President Trump signed into law on July 4.
In addition to the enhanced senior deduction and deductions for qualified tips, overtime, and car loan interest, the new law also conformed to the larger standard deduction amounts outlined in Trump’s federal legislation.
This means that for taxpayers in Idaho, the standard deduction is equal to the federal standard deduction, which is $15,750 for single filers, $31,500 for joint filers, and $23,625 for heads of households for the 2025 tax year.
The standard deduction allows filers to keep a set amount of their earnings tax-free, as it directly reduces the amount of income subject to income tax.
Earnings that exceed the income thresholds will be subject to the state’s flat 5.3% individual income tax rate.
This rate applies to all income levels, replacing the previous, higher tiered structure.
The Idaho State Tax Commission announced on February 20 that it had programmed its systems to automatically provide the boosted standard deduction amounts to residents who opt for that instead of itemizing their deductions on their 2025 income taxes.
This means that the more than 158,000 taxpayers who had already submitted their tax returns will not have to file amended returns to claim the larger standard deduction, according to the commission.
For residents who have yet to file, the commission said it updated Form 40 and Form 43 to reflect the larger standard deduction amounts.
Most major tax software such as TurboTax or H&R Block has also been updated with these new figures.
Taxpayers can now file their 2025 Idaho income tax returns to claim all the new conformity deductions as well, like the extra $6,000 deduction for seniors or the deduction of up to $25,000 for tip and overtime income.
Due to the system updates required for House Bill 559, there may be slight refund delays.
Idaho residents who submit their returns before March 10 can expect to receive their tax refund by the end of May, according to the Tax Commission.
Taxpayers who file on or after that date should receive their refund within about seven to eight weeks for e-filed returns and 10 to 11 weeks for paper returns.
THE U.S. SUN
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