Summary
Idaho conforms to the federal Enhanced Senior Deduction (OBBBA, IRC §63(f)) via HB 559. PE applies the deduction at the federal level but not at the Idaho state level.
Related: PolicyEngine/policyengine-taxsim#721
Details
Per the Idaho Tax Commission, the enhanced senior deduction is claimed on Form 40 line 18 (or Form 43 line 40). Idaho's conformity guidance was published in early March 2026.
The federal deduction parameters (already implemented in PE at gov.irs.deductions.senior_deduction):
- $6,000 per eligible senior (65+)
- Joint phase-out: 6% of AGI over $150,000
- Other filers phase-out: 6% of AGI over $75,000
Idaho should subtract this deduction from state taxable income, matching the federal calculation.
Example
Joint filers, both age 70, $200,000 interest income, $60,000 itemized deductions (2025):
| Variable |
PE (current) |
Expected |
| Federal taxable income |
$131,000 |
$131,000 |
| Enhanced senior deduction |
$9,000 |
$9,000 |
| ID taxable income |
$140,000 |
$131,000 |
Suggested Fix
Add an Idaho subtraction variable that references the federal additional_senior_deduction, effective 2025-01-01, and include it in Idaho's subtractions.
Integration Test
- name: ID joint 2025 elderly couple with OBBBA senior deduction conformity
period: 2025
input:
people:
person1:
age: 70
taxable_interest_income: 100_000
is_tax_unit_head: true
person2:
age: 70
taxable_interest_income: 100_000
is_tax_unit_spouse: true
tax_units:
tax_unit:
members: [person1, person2]
spm_units:
spm_unit:
members: [person1, person2]
households:
household:
members: [person1, person2]
state_fips: 16 # ID
output:
additional_senior_deduction: 9_000
id_taxable_income: 156_300
Summary
Idaho conforms to the federal Enhanced Senior Deduction (OBBBA, IRC §63(f)) via HB 559. PE applies the deduction at the federal level but not at the Idaho state level.
Related: PolicyEngine/policyengine-taxsim#721
Details
Per the Idaho Tax Commission, the enhanced senior deduction is claimed on Form 40 line 18 (or Form 43 line 40). Idaho's conformity guidance was published in early March 2026.
The federal deduction parameters (already implemented in PE at
gov.irs.deductions.senior_deduction):Idaho should subtract this deduction from state taxable income, matching the federal calculation.
Example
Joint filers, both age 70, $200,000 interest income, $60,000 itemized deductions (2025):
Suggested Fix
Add an Idaho subtraction variable that references the federal
additional_senior_deduction, effective 2025-01-01, and include it in Idaho's subtractions.Integration Test