This bill amends various sections of the Idaho Code to enhance the taxation framework for affected business entities, including partnerships and S corporations. Key changes involve the election process for these entities to be taxed under specific provisions, requiring that elections be made using a form prescribed by the state tax commission. The bill also clarifies definitions such as "affected business entity income" and "exempt entity," while establishing new provisions regarding partnership income and federal adjustments. Additionally, it modifies the timeframes for filing elections and tax payments, including the treatment of net operating losses and tax credits, and revises the period of limitations for issuing notices of deficiency and collecting taxes, particularly in cases of fraudulent returns or failures to file.

Moreover, the bill updates notification requirements for taxpayers concerning federal tax adjustments, extending the deadline for notifying the state tax commission of final determinations from 120 days to 180 days. It introduces new procedures for partnerships in reporting federal adjustments, detailing the roles of state partnership representatives and timelines for compliance. Significant amendments include changes to Section 63-3072, which alters the time limits for claiming refunds or credits related to tax overpayments, particularly in light of final federal adjustments. The bill is set to take effect on July 1, 2026, following an emergency declaration for its implementation.

Statutes affected:
Bill Text: 63-3026B, 63-3068, 63-3069, 63-3072