Does IdahoTax Tips & Overtime After the OBBBA?
Idaho conforms to the federal deductionfor the federal OBBBA tip and overtime deductions. Here's what that means for your paycheck.
Compiled by Sharon Ben-Moshe · Conformity data verified August 1, 2026
Quick answer
Idaho has a state income tax (about 5.8% used for estimates) and currently conforms to the federal deduction. That means your tips and overtime are exempt at the state level too.
Tips deduction
Conformed
Overtime deduction
Conformed
Details for Idaho
Idaho House Bill 559 (signed Feb. 10, 2026) updated IRC conformity retroactive to Jan. 1, 2025 and conforms to the federal qualified tips and overtime deductions at the same dollar caps.
Last verified August 1, 2026.
How OBBBA tips & overtime work in Idaho
The OBBBA is a federal deduction: eligible workers can deduct up to $25,000 of tips and $12,500 of overtime premium ($25,000 if married filing jointly) from federal taxable income through 2028. Whether Idaho follows suit depends on state conformity. FICA (Social Security and Medicare) applies everywhere. Learn more about the tip deduction and the overtime deduction.
How this is sourced: Idaho's conformity status is tracked against state legislation and primary IRS guidance, and re-verified as the law changes. See our methodology and sources.