Idaho law allows certain pass-through entities to make an election to pay tax at the entity level. If the S corporation or partnership makes this election, they are then called an "electing pass-through entity." Members of an electing pass-through entity are eligible for a credit on their individual return. See the Idaho website for details.

The election can be made when filing the return. The election is made annually.

1065/1120-S

Make the election by going to ID screen 1 and selecting the box Affected business entity. This selects the corresponding box on ID Form 65 or 41S and produces ID Forms ABE and PTE-12. Note that ID Form ABE must be attached as a PDF when e-filing (EF Message 1261).

Form ID-VP is generated to show the amount due. If e-filing the return, payments can be made using federal screen PMT.

Use screen ES to generate estimated tax payments, if needed.

If the entity is a member of another ABE entity, use ID screen CR, line 57, Taxes paid by affected business entity (ABE) on your behalf to enter any amount paid by the upper entity. If the S corp or partnership is not a partner or shareholder in another ABE, leave this line blank.

1040

Complete ID screen K1, including the Pass-through Entity Tax Credit on line 58. This amount flows to ID Form 40, line 48 or ID Form 43, line 68. An override is available on ID screen 3.