Payroll tax in Idaho: What employers need to know [2024]

Running a business in Idaho? Employers in the Gem State have a lot of obligations, not least of which are taxes. Handling this responsibility can be stressful, and it’s easy to see why. Not only do you need to properly remit federal income taxes and FICA taxes to the IRS, but you also need to worry about state payroll taxes—and payroll tax rates vary depending on which state you’re in. The bottom line: If you want to avoid costly fines and penalties, you have to understand the tax laws in the states where your employees live.

Fortunately, Idaho is one of the more straightforward states when it comes to state income taxes. It offers a simple flat tax rate, meaning everyone gets charged the same percentage when it’s time to pay, regardless of how much they make.

Whether you’re running a small business or scaling an enterprise, if you have employees working in the state of Idaho, you need a thorough understanding of Idaho’s state payroll taxes, their respective rates, who pays what, and when payments are due. We’ll cover all of the above and more in this primer. 

The 2 Idaho payroll taxes

In the Gem State, the Idaho State Tax Commission and the Idaho Department of Labor are jointly responsible for administering state payroll taxes. Under federal and state new hire reporting requirements, all Idaho employers must report new employees no later than 20 days after their start date. Furthermore, an ID W-4 form must be submitted to the Idaho State Tax Commission for each employee.

There are two Idaho payroll taxes. Let’s review each one.

State unemployment insurance tax

According to the terms of the Federal Unemployment Tax Act (FUTA), employers in Idaho need to pay federal unemployment taxes. Idaho also levies its own state unemployment insurance (SUI) tax, which benefits employees who find themselves out of work due to reasons beyond their control. SUI tax falls under the purview of the Idaho Department of Labor.

For 2024, the SUI tax rate for new employers is set at 1.231%. For all other employers, the SUI tax rate ranges from 0.352% to 5.4%; the Idaho Department of Labor will determine each employer’s annual SUI tax rate once they are no longer deemed a new employer and notify them of their rate each year. The taxable wage base for 2024 is $53,500.

Idaho income tax

In addition to paying SUI tax, Idaho employers must withhold the correct income tax amount from each employee’s paycheck. Idaho, like the majority of states in the US, levies its own state income tax on top of the mandatory federal income tax. Fortunately, Idaho’s income tax is pretty straightforward: All state residents are charged a flat income tax rate of 5.8% in 2024. This rate applies to all taxable wages over $4,489 for those filing as single and over $8,978 for those filing jointly. The Idaho State Tax Commission manages the reporting, collection, and enforcement of the state income tax.

Navigating payroll tax laws in Idaho can be challenging, but Rippling’s payroll compliance software makes it easy to file the right amount of taxes. Rippling automatically calculates your taxes and submits your tax forms and payments for you—so you’re always compliant with federal and Idaho state regulations. If you’re looking for an even more automated process, Rippling PEO takes it a step further: It can register and maintain your state tax accounts for you.

Payroll tax due dates in Idaho

Idaho employers must submit income tax payments to the Idaho State Tax Commission by the 20th day of the month following the tax period if they pay monthly or the last day of the month if they pay quarterly. SUI tax is due on a quarterly basis.

The quarterly deadlines for both types of payroll taxes are as follows:

• First quarter (January-March): Due April 30
• Second quarter (April-June): Due July 31
• Third quarter (July-September): Due October 31
• Fourth quarter (October-December): Due January 31

If one of these dates falls on either a weekend or a federal holiday, the Idaho state government requires you to complete your tax filing by the following business day. 

How to submit payroll taxes in Idaho

Now that we’ve gone over the types of Idaho payroll taxes and their respective due dates, you’re likely wondering how you can make your payments. We’ll discuss the options for submitting your payroll taxes in the Gem State below.

Enroll in e-Services 

Idaho employers seeking a convenient and secure self-service option can use the online portals provided by the Idaho Department of Labor and the Idaho State Tax Commission to pay their payroll taxes. The DOL offers instructions in its Unemployment Insurance Handbook about how to use the Employer Portal, while the Idaho State Tax Commission offers e-pay services here.

Pay in person 

If you’d rather stretch your legs at lunch, you can make your state income tax payments in person. The Idaho State Tax Commission has drop boxes in Boise, Coeur d’Alene, and several other cities and towns; these boxes are open Monday through Friday, from 8 a.m. to 5 p.m. You can find the address for the drop box nearest you here.

Mail a payment

Prefer traditional mail? The Idaho State Tax Commission accepts mailed-in payments with and without their forms—although you need to use a different address depending on whether you’re sending in forms. Send state income tax payments with a tax return form to:

Idaho State Tax Commission
PO Box 56
Boise ID 83756-0056

Send income tax payments without a return form to:

Idaho State Tax Commission
PO Box 83784
Boise ID 83707-3784

Transfer funds electronically

Idaho employers can make an electronic funds transfer to pay their state income taxes using ACH credit. To do this, you’ll need an ACH Credit Addenda and Bank Information form, which you can request by emailing eft@tax.idaho.gov. Once you’ve filled out the form, simply take it to your bank, and they’ll help you finish the setup.

Rippling’s full-service payroll software

Want to find an even easier payment option? Look no further than Rippling’s payroll software, which is so powerful it practically runs itself. Rippling automates all your compliance work and files your federal and Idaho state payroll taxes at the right time with the IRS and the Idaho State Tax Commission.

FAQs about Idaho payroll taxes

Are there local tax laws in Idaho?

No, the state of Idaho doesn’t have any local tax laws.

Can your tax returns be audited in Idaho?

Yes, the Idaho State Tax Commission reserves the right to audit Idaho residents' state income tax returns and other tax filings to ensure they’re paying the correct amount of taxes.

Are nonprofit organizations subject to payroll taxes in Idaho?

If a nonprofit organization has been granted an exemption from paying federal income tax under Section 501(c)(3) with the IRS, it’s also exempt from paying Idaho income tax.

Disclaimer: Rippling and its affiliates do not provide tax, accounting, or legal advice. This material has been prepared for informational purposes only, and is not intended to provide or be relied on for tax, accounting, or legal advice. You should consult your own tax, accounting, and legal advisors before engaging in any related activities or transactions.