Idaho Admin. Code r. 35.01.02.073 - TANGIBLE PERSONAL PROPERTY BROUGHT OR SHIPPED TO IDAHO
Sections 63-3615, 63-3621, 63-3621A, Idaho Code
01.
Equipment Brought into
Idaho. Equipment or other tangible personal property brought or shipped
to Idaho by residents or nonresidents is presumed to be for storage, use, or
other consumption in this state. Generally, tangible personal property is
subject to use tax on its fair market value when it is first used in Idaho.
Special rules apply to transient equipment present in Idaho for ninety (90)
days or less in any consecutive twelve (12) month period. See Section
63-3621A, Idaho Code, and
Subsection 073.03 of this rule. For
property a contractor fabricates to install into Idaho real property, see Rule
012 of these rules.
(3-31-22)
02.
Substantive
Use. Any substantive use of the property in Idaho is sufficient to
subject the property to use tax. Use is defined in Section
63-3615, Idaho Code, and Rule
072 of these rules. The use tax
does not apply to the use of items purchased before July 1, 1965, or the use of
items excluded from tax by Idaho Code. (3-31-22)
03.
Transient Equipment.
Transient equipment means equipment that is: owned by the user, which is a
business based in another state; a depreciable asset for income tax purposes
and treated as such on the owner's income tax returns; brought to Idaho and
kept here for ninety (90) days or less in any consecutive twelve (12) months;
and either was not taxed in another state or, if tax was paid to another state,
the amount paid was less than the amount of Idaho use tax due. (3-31-22)
a. A nonresident business that brings
transient equipment to Idaho may elect to pay use tax on either the fair market
value of the equipment at the time it enters Idaho, or the fair market rental
value of transient equipment for the time it is kept in Idaho. Fair market
rental value is the amount it would cost to rent or lease similar equipment
from an unrelated equipment rental company. (3-31-22)
b. Businesses that elect to pay use tax on
the rental value of transient equipment may do so without the approval of the
Commission as long as the use tax due on the first month's rental is paid in a
timely manner. If the owner fails to pay the tax timely, he will need written
approval from the Commission to use this option. (3-31-22)
c. Equipment which remains in Idaho for more
than ninety (90) days in any consecutive twelve (12) months is no longer
transient. This equipment becomes subject to Idaho use tax on its fair market
value at that time. No credit may be taken for use tax paid on fair market
rentals against the use tax due at the time equipment ceases to qualify as
transient. (3-31-22)
d. Example: A
Wyoming contractor brings transient equipment, with a fair market value of one
hundred thousand dollars ($100,000), to Idaho for use on a ninety (90) day
project. The fair market rental value of the equipment for the ninety (90) days
totals fifteen thousand dollars ($15,000). Idaho use tax on the fair market
rental value, assuming a rate of six percent (6%), totals nine hundred dollars
($900). The contractor paid three thousand five hundred dollars ($3,500) of
sales tax to the state of Wyoming when he bought the equipment new. The
contractor is not required to pay tax to Idaho since the tax paid to Wyoming
exceeds the amount of Idaho use tax due. (3-31-22)
e. Example: The same contractor in the
previous example returns to Idaho within the same twelve (12) months with the
same equipment, now with a fair market value of ninety-five thousand dollars
($95,000). As the equipment has now exceeded the ninety (90) day rule for
transient equipment, it is subject to Idaho's six percent (6%) use tax on its
present value of ninety-five thousand dollars ($95,000) x six percent (6%) =
five thousand seven hundred dollars ($5,700). Credit of two thousand six
hundred dollars ($2,600) is allowed for sales tax paid to Wyoming, three
thousand five hundred dollars ($3,500) less the nine hundred dollar ($900)
credit already used on rentals. The contractor owes three thousand one hundred
dollars ($3,100) of use tax to Idaho. (3-31-22)
04.
Licensed Motor Vehicles. A
motor vehicle licensed in a nonresident's home state and brought to Idaho to
use for ninety (90) days or less in any consecutive twelve (12) months is not
subject to Idaho use tax. Once the vehicle is used here more than ninety (90)
days during any consecutive twelve (12) months, use tax applies to the fair
market value of the vehicle at that time unless tax was paid to another state
in an amount equal to, or greater than, the tax owed to Idaho. Special rules
apply to new residents, nonresident college students, and temporarily assigned
military personnel in Idaho. See Rule
107 of these rules.
(3-31-22)
Notes
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