Idaho currently has 25 census tracts designated as Qualified Opportunity Zones. These opportunity zones exist in a wide range of communities throughout the state of Idaho. Qualifying as an opportunity zone takes certain requirements, one of which is receiving approval from the governor. Opportunity zones are low-income areas where tax breaks can serve as a way of improving the community. The state of Idaho is one of 18 states that did well in the early reports on opportunity zones.
Idaho’s opportunity zones are not dominated by one city or area as it has one of the most liberal disbursements of opportunity zones of any states. Moscow is the only city in Idaho with two tracts that qualified as opportunity zones.
Opportunity Zones were created to encourage private investments in communities that are found to be in economic distress. Low-income areas comprise these opportunity zones and the method of assisting these areas in economic rebuilds is through capital gains tax incentives. Income is a primary factor in nominating a tract as an opportunity zones, although there are other factors that are considered.
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Idaho Tax Situation
Idaho has a personal income tax rate that ranges from 1.6 to 7.4 percent, making it one of the better states to live in terms of taxes. There are seven different income brackets and residents are taxes according to their annual income. Idaho also collects taxes into a general fund that protects against times of recession and that fund has vastly increased in recent years.
The sales tax in Idaho checks in at 6 percent and some municipalities add a percentage or two onto their sales tax. One major benefit of living in Idaho is that there is no inheritance tax in the state.
Idaho ranks 13thin the country in property taxes. The annual average for property taxes on a $185k home is $1,404. Idaho is not the friendliest state when it comes to wealthy residents, although the tax situation makes it an affordable place to live for many of its residents. Foreclosures are also minimal as they are less than a half percent throughout the state.
ID Industries with Tax Breaks
There are a number of different industries that are eligible for tax breaks in the state of Idaho. The state government features numerous incentive programs while local governments have a variety of options as well. Here is a look at some of the top industries that benefit from Idaho tax breaks.
The state of Idaho is responsible for a third of the nation’s potatoes but that also extends to potato products which has generated a sizeable food production industry.
This sector is led by Micron Technology, a memory chip producer, and also includes other major technology companies.
The nation’s leading nuclear research facility is located in Idaho and the affiliations with the department of energy has led to considerable tax breaks.
There are numerous incentives for companies looking to take advantage of this industry in the state.
Tax breaks extend to other Idaho industries, which include recreation technology, shared services and aerospace. Each of those industries have smaller sub-groups that can also apply for a variety of tax incentives.
Idaho State Financial Facts
The cost of living in Idaho features a unique trend as it costs more to live in some rural areas on average than it does to live in most communities in the city of Boise. There is only a small difference in those calculations as both are relatively similar. But it does prove a stark contrast from many other states where its major city has a much higher cost of living. Here are some more financial facts within the state of Idaho:
- Median household income – $64,513
- Median household savings
- $0 in savings: 43%
- $1,000 or less in savings: 55%
- Total household investments
68.5 percent of families that own their home
Median value of Idaho home – $246,200
2.9 percent of households earn over $200k per year
Current economic condition of Idaho
Unemployment rates are low in Idaho as it continues to hover around 2.7 percent. However, that does not always translate into exceedingly high pay as the average weekly wage stands at $760. The overall economic climate is very favorable as it ranks No.7 in the country, according to Forbes Magazine. That has led to forecasts which predict high growth rates for Idaho jobs, putting it right near the top of the country in that category.
The Idaho economy has also benefited from low crime rates as it is among the top five safest states to live. Businesses are also flocking to Idaho because of favorable tax rates and a blossoming economy. Idaho has developed a reputation for helping businesses instead of impeding their progress. It is also considered to be a state that is very friendly and welcoming of small businesses. Numerous programs and tax incentives have been set up to assist small business owners.
Trends have also continued to show that Idaho’s economy keeps on improving. Idaho has the eighth lowest poverty rate in the nation and if the current trends continue, that ranking could also improve. Also, only eight other states have lower unemployment rates than Idaho.
Primary Industries in Idaho
Industry in Idaho is booming and that is because there is no need to depend on one area for economic prosperity. There are longtime staples in the Idaho economy, although there has also been a surge in the technological sector. There are some industries that have stepped to the forefront in Idaho and they are as follows:
- Science & Technology
- Food Processing
Opportunity Zones in Idaho
Idaho is one of the better states when it comes to low poverty rates, although there are still communities that have fallen under difficult times. That has led to more than two dozen opportunity zones. The census tracts are mostly defined by low income and the chance to regenerate these areas would bode well for Idaho’s surging economy. Here is a look at the Idaho opportunity zones:
- New Meadows
- Benewah County
- Bonner County
- Boundary County
- Canyon County
- Canyon County
- Clearwater County
- Nez Perce Tribe
- Mountain Home
- Post Falls
- Moscow (2)
- Shoshone County
- Twin Falls
- Valley County
As listed above, there are still some areas that can benefit from capital gains tax incentives. Opportunity zones have the capability of helping Idaho’s distressed areas catch up to the rest of the state. Coeur d’Alene and Boise are both showing great economic prosperity and are featured in the top 10 fastest growing cities in the United States. The cities of Rexburg and Rupert are on the opposite end as the two biggest cities facing an economic downturn. Some of the most distressed towns are rural ad have small populations that do not exceed more than two or three thousand people. There is still a lot of rural space in Idaho as well, which increases the need for economic development.
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