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Level 3
March 29, 2026
New

Idaho Capital Gain Exclusion

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  • March 29, 2026
  • 3 replies
  • 7 views

When Idaho real estate is sold that has been held over 12 month, there is a 60% exclusion of the capital gain on the Idaho return. This should be automatic if the property is being sold by an Idaho resident or coded as an Idaho property for an Idaho non-resident. There should also be a diagnostic to warn preparers to look for this.

3 replies

sjrcpa
Level 15
March 30, 2026

Just curious - is this new Idaho law? Or has it been around a while?

I rarely do an ID return.

The more I know the more I don’t know.
Tami MAuthor
Level 3
March 30, 2026

This is an ongoing law but it is frequently missed.

 

BobKamman
Level 15
March 30, 2026

This reminds me of the Arizona case (Ladewig), from the late 1980s, in which it was decided that a deduction for dividends only from corporations doing more than 50% of their business in Arizona was unconstitutional.  It was a violation of the Commerce Clause.  Maybe Idaho can distinguish their rule, because it involves real estate and not corporate dividends.  Or maybe anyone in Idaho who sells real estate outside the state, will be eligible for a refund.