BOISE, ID – A new Idaho law that took effect July 1, 2025, exempts certain small sellers from charging sales tax, providing relief for individual and sole proprietor businesses with limited annual revenue.
According to the Idaho State Tax Commission, a “small seller” is defined as an Idaho resident operating individually or as a sole proprietorship whose gross sales do not exceed $5,000 in either the current or previous calendar year. This amount includes sales made in-state, out-of-state, or through marketplace platforms.
Qualified small sellers under this new law are no longer required to obtain a seller’s permit or collect Idaho sales tax on their transactions. However, the exemption does not apply to the sale of vehicles, lodging, alcohol, or admissions.
The Tax Commission clarified that eligible small sellers must still:
- Pay sales tax on all purchases they make.
- Begin tracking sales once they exceed $3,000 annually.
- Register with the Tax Commission if participating in a promoter-sponsored event.
- Report all income on their income tax returns.
If a seller’s gross sales exceed $5,000 or they no longer meet the law’s other criteria, they must acquire a seller’s permit within 30 days and begin collecting and submitting sales and use tax to the state.
More information, including eligibility details, is available at tax.idaho.gov/smallseller. For questions, contact the Idaho State Tax Commission at (208) 334-7660 or (800) 972-7660.
