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Idaho Tax Commission: Some COVID-19 Relief Is Taxable

Dated Dec. 4, 2020

SUMMARY BY TAX ANALYSTS

The Idaho State Tax Commission explained that some COVID-19 relief payments are considered taxable income, even if federal taxes were withheld; taxable payments include but are not limited to state unemployment insurance benefits, pandemic unemployment assistance for self-employed workers and independent contractors, Rebound Idaho grants for small businesses and the self-employed, and some return-to-work bonuses.

Taxpayers can make estimated payments online using the commission’s Quick Pay service ahead of the upcoming tax season.

Heads-Up: Jobless benefits, pandemic grants and bonuses are taxable

Did you receive money from the state due to the COVID-19 pandemic? As you start preparing your 2020 Idaho income tax return, please be aware that you may have received taxable income this year for which state tax wasn't withheld, even if federal taxes were. That includes but isn't limited to:

  • Idaho unemployment insurance benefits

  • Pandemic Unemployment Assistance (PUA) for self-employed workers, independent contractors, and gig workers

  • Rebound Idaho grants for small businesses and the self-employed

  • Idaho's Return-to-Work bonuses for employees idled as a result of the pandemic who returned to work from April 20 through July 15

If you're concerned about having an income tax bill in 2021, you can take one of the following steps now:

  • Make estimated payments using the Tax Commission's Quick Pay service at tax.idaho.gov/quickpay. You can find additional payment options at tax.idaho.gov/epay.

  • Start setting aside money each month to help cover any tax you may need to pay next April.

Please contact your financial or tax advisor with any questions about your 2020 taxable income. (Note: Federal economic impact funding — sometimes referred to as “stimulus” payments — isn't taxable income.)

For other questions:

  • Call us at (208) 334-7660 in the Boise area or toll free at (800) 972-7660.

  • Email us at taxrep@tax.idaho.gov.

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