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Idaho taxpayers get IDeal tax benefits

Idaho taxpayers can deduct up to $6,000 ($12,000 if married filing jointly) in contributions to an IDeal account, helping education savings go further through state tax benefits.

IDeal Tax Benefits

Contributions

IDeal offers a state tax deduction on your Idaho state income taxes when you contribute.

Tax-Deferred
Growth

While your money is growing, you don’t pay taxes.

Tax-Free Withdrawals

You don’t pay taxes on withdrawals made for qualifying reasons.

Contributions

Taking your Deduction

  • Idaho taxpayers qualify for a state tax deduction of up to $6,000 ($12,000 if married, filing jointly) annually for contributions to an IDeal account.
  • To take advantage of the Idaho state tax deduction, be sure your contributions are made by December 31 of the tax year.
  • An Idaho taxpayer who contributes to an IDeal account, regardless of whether they are the account owner, is eligible for the state tax deduction.
  • Contributors are responsible for retaining documentation of the timing and amount of the contributions for tax purposes.
FAQ

TAX-DEFERRED GROWTH and TAX-FREE WITHDRAWALS

Use your money for education, not taxes.

With an IDeal account, your savings has the potential to grow at a faster rate than if you had invested in a comparable taxable account. That’s because any earnings are exempt from both Idaho and federal taxes when the funds are utilized for qualified expenses.

Bar chart: tax-deferred savings in a 529 can grow more than in a comparable taxable account

OTHER TAX BENEFITS

Tax Benefits for You, the Gift of Education for Them

  • You can contribute up to $19,000 ($38,000 if married filing jointly) in a single year without incurring a gift tax.
  • Reduce your personal taxable estate by making five years’ worth of gifts (currently up to $95,000; $190,000 for married couples filing jointly) in one lump sum.*

*In the event you do not survive the five-year period, a pro-rated amount will revert back to your taxable estate.

FAQS

Learn More About taxes

If you are an Idaho taxpayer, you are eligible for a state income tax deduction of up to $6,000 ($12,000 if married, filing jointly) for your IDeal contributions for each tax period. (Contributions to the IDeal - Idaho Education Savings Program are deductible from Idaho state income tax, subject to recapture in certain circumstances, such as a non-qualified withdrawal or a rollover to another state's qualified tuition program in the year of the rollover and the prior tax year). Earnings in your IDeal account grow tax-deferred and are free from federal income tax when used for qualified education expenses.1

Individuals can invest up to $19,000 ($38,000 for married couples) per beneficiary without incurring any federal gift-tax consequences. You can also contribute up to $95,000 per beneficiary in a single year ($190,000 for married couples) and take advantage of five years' worth of tax-free gifts at one time. Contributions are considered completed gifts and are removed from your estate6, but you, as the account owner, retain control. Upon the death of the account owner, money remaining in the account will not be included in the account owner's estate for federal estate tax purposes. For more information, consult your tax advisor or estate-planning attorney.

Yes. Idaho employers qualify for a 20% tax credit, up to $500 per employee per year, for contributions to an employee's IDeal account. The employee may take an Idaho state income tax deduction for contributions made by his/her employer.