Form 85 - Idaho Small Employer New Jobs Tax Credit - 2014 Page 3
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06-13-14
Instructions for Idaho Form 85
But equal to or
GENERAL INSTRUCTIONS
If the annual
less than an
salary is greater
Then the credit
Form 85 is used to calculate the Idaho small employer new jobs
average rate of ...
than …
earned is ...
tax credit (SE-NJTC) earned or allowed. Each member of a
$24.04 per hour
$28.85 per hour
$1,500
unitary group of corporations that earns or is allowed the credit
must complete a separate Form 85.
An average rate of
$28.85 per hour
$36.06 per hour
$2,000
If the project period began during this tax year and didn't cover a
An average rate of
period of at least nine months, you don't qualify for the SE-NJTC
$43.27 per hour
$2,500
$36.06 per hour
this year.
An average rate of
$3,000
$43.27 per hour
QUALIFYING TAXPAYERS
To qualify for the SE-NJTC, you must certify by filing Form 89SE
that you will meet the tax incentive criteria at the project site
RECAPTURE
during the project period. If you haven't filed Form 89SE with the
You must compute recapture if you don't maintain the required
Tax Commission, or you have been notified that you don't qualify
level of new employees for five full years from the date the
for the small employer incentives, you can't claim this credit.
project period ends.
Also, you must compute recapture if you claimed the SE-NJTC
QUALIFYING NEW EMPLOYEES FOR THE SE-NJTC
To qualify for the credit, the new employee must:
in an earlier year and fail to meet the tax incentive criteria you
certified to on Idaho Form 89SE.
• Qualify as a new employee for purposes of the small employer
If you claimed the SE-NJTC and recapture is now required, file
tax incentive criteria discussed above,
• Earn more than $24.04 per hour, and
Form 85R.
• Have worked a minimum of nine months during the tax year in
SPECIFIC INSTRUCTIONS
which the credit is claimed.
CALCULATING THE CREDIT
Instructions are for lines not fully explained on the form.
The Employer Quarterly Unemployment Insurance Tax Reports
and the Unemployment Insurance Wage Reports filed with the
CREDIT AVAILABLE SUBJECT TO LIMITATION
Idaho Department of Labor are used to compute the number
Line 1. Determine the average number of qualifying employees
of employees. However, only those employees who meet the
during the tax year by adding the number of qualifying
definition of “new employee” can be included when computing
employees reported for each month on your Idaho Employer
the SE-NJTC. Don't include any employees who don't work
Quarterly Unemployment Insurance Tax Reports and dividing
primarily in the project site. You must keep records to support
that amount by the number of months of operation during the
the computations.
tax year. Don't include any employees who weren't employed
primarily at the project site.
The number of employees employed primarily at the project
site during a tax year is the average of the number of such
Line 2. Determine the average number of qualifying employees
employees reported to the Idaho Department of Labor during the
during the three preceding tax years by dividing the total of the
12 months of the tax year. If the project period began during the
average number of qualifying employees reported on your Idaho
Employer Quarterly Unemployment Insurance Tax Reports for
tax year, the number of employees for the year is the average
number actually employed during the months of the project
each preceding year by three. If the project period existed less
period. However, you can't earn the credit if the project period
than three tax years, use the number of tax years in operation.
didn't cover at least nine months during the first tax year. These
employees may qualify for the credit the next year.
Line 3. Determine the average number of qualifying employees
during the preceding tax year by adding the number of qualifying
employees reported for each month on your Idaho Employer
The number of qualifying new employees is the increase in the
Quarterly Unemployment Insurance Tax Reports and dividing
number of qualifying employees for the current tax year over the
greater of the following:
that amount by the number of months of operation during the
preceding tax year. Enter zero if the project period covered less
• The average number of qualifying employees for the three
than nine months the preceding tax year.
preceding tax years, or
• The average number of qualifying employees for the preceding
Line 4. No credit is allowed unless the number on this line
tax year.
equals or exceeds one. If it is more than one, the number is
rounded down to the nearest whole number.
The number of qualifying new employees must be rounded down
to the nearest whole number.
Line 5. To complete lines 5a through 5d, you must be able
to identify each individual who is a qualifying new employee
CREDIT RATES
and the annual average salary earned during the tax year by
Each qualifying new employee must be identified in order to
that individual. Enter the number of qualifying new employees
determine the credit allowed, which is based on the annual
according to their annual salary earned for the tax year. The
salary of the employee as shown in the following table.
amounts listed on lines 5a through 5d can't exceed the number
on line 4.
CARRYOVER PERIODS
The SE-NJTC earned but not used against tax may be carried
Line 11. Enter the amount of the SE-NJTC that is being passed
forward for 10 tax years. For purposes of the carryover period, a
through by partnerships, S corporations, estates or trusts in
which you have an interest. This amount is reported on Form
short tax year counts as one tax year.
ID K-1, Part D, line 11.
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