Idaho retirement taxes at a glance (2026)
| State income tax | Flat 5.3%Idaho has a flat 5.3% income tax. |
|---|---|
| Social Security | Not taxedIdaho does not tax Social Security benefits. |
| Pensions | TaxedPrivate pensions are taxed at 5.3%. |
| 401(k) and IRA withdrawals | TaxedIRA and 401(k) withdrawals are taxed at 5.3%. |
| Government pensions | Partly taxedThe retirement benefits deduction also covers federal civil service pensions (65+, or 62+ if disabled) and certain Idaho police and firefighter pensions, with the same caps. |
| Military retirement pay | Partly taxedMilitary retirees who are 62+, disabled, or working enough to file a federal return can deduct military retirement pay, up to about $48,216 single or $72,324 joint, reduced by Social Security received. |
| Estate tax | No |
| Inheritance tax | No |
| Property tax help for seniors | The Property Tax Reduction program cuts property tax by $250-$1,500 for homeowners 65+ with income of $39,130 or less; the homeowner's exemption covers 50% of value up to $125,000. |
| Sales tax | State sales tax is 6%. |
Recent changes and good to know
- The rate fell from 5.695% to 5.3% on 2025-01-01 (HB 40) and stays at 5.3% for 2026.
- For 2025, the military retirement deduction was widened to retirees under 62 who work.
- The civil service and police/firefighter age rules in public_pensions were not confirmed on a state page in this pass.
How to lower your retirement taxes in Idaho
- Mix your income sources. Roth IRA withdrawals are tax-free at the federal level and generally in Idaho too, so a Roth conversion before retirement can cut state tax later. Try the Roth conversion calculator.
- Watch federal Medicare costs. Large IRA withdrawals can raise your Medicare premiums. Check the 2026 IRMAA brackets.
- Think about your heirs. See what your IRA will really cost your family with the Family Tax Rate calculator.
- Comparing states? These have no state income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, Wyoming.
Frequently asked questions
Does Idaho tax retirement income?
Mostly yes: Idaho exempts Social Security, but taxes private pensions and IRA/401(k) withdrawals at 5.3%; only military and some government pensions get a deduction.
Does Idaho tax Social Security?
Idaho does not tax Social Security benefits.
Does Idaho tax pensions?
Private pensions are taxed at 5.3%.
Does Idaho tax 401(k) and IRA withdrawals?
IRA and 401(k) withdrawals are taxed at 5.3%.
Does Idaho tax military retirement pay?
Military retirees who are 62+, disabled, or working enough to file a federal return can deduct military retirement pay, up to about $48,216 single or $72,324 joint, reduced by Social Security received.
Sources (last verified 2026)
- What's new for 2025 income tax returns — Idaho State Tax Commission (2026)
- Idaho State Taxes for 2026 — AARP (2026-03-17)
Educational content only, not tax, legal or investment advice. Plans and tax laws change; confirm details with your employer's plan documents or your state revenue department. Smart Financial Lifestyle is not affiliated with any employer named on this site.