From b99361191d1a240484a41355472f415a5e44f054 Mon Sep 17 00:00:00 2001 From: Max Ghenis Date: Sun, 8 Nov 2026 04:51:16 -0500 Subject: [PATCH 1/2] Set Idaho's 2026 retirement benefits deduction cap from SSA's maximum benefit Idaho Code 63-3022A(2) caps the deduction at the maximum Social Security benefit for a worker reaching full retirement age in the tax year. SSA's 2026 fact sheet gives $4,152 a month, so the cap is $49,824 for unmarried filers and unremarried survivors and $74,736 (1.5 times, adding the spouse's benefit on the worker's record) on a joint return. PolicyEngine-US had extrapolated $49,309 and $73,963 from 2025 with IRS uprating. Co-Authored-By: Claude Opus 5.5 --- .../fix-id-retirement-cap-2026.fixed.md | 1 + .../deductions/retirement_benefits/cap.yaml | 11 ++ .../id_retirement_benefits_deduction.yaml | 110 ++++++++++++++++++ 3 files changed, 122 insertions(+) create mode 100644 changelog.d/fix-id-retirement-cap-2026.fixed.md diff --git a/changelog.d/fix-id-retirement-cap-2026.fixed.md b/changelog.d/fix-id-retirement-cap-2026.fixed.md new file mode 100644 index 00000000000..ef3b3911ab6 --- /dev/null +++ b/changelog.d/fix-id-retirement-cap-2026.fixed.md @@ -0,0 +1 @@ +Set Idaho's 2026 retirement benefits deduction cap to $49,824 for single filers, heads of household and surviving spouses, and $74,736 for joint filers, from the Social Security Administration's 2026 maximum benefit for a worker retiring at full retirement age, as Idaho Code ยง 63-3022A(2) defines the cap. diff --git a/policyengine_us/parameters/gov/states/id/tax/income/deductions/retirement_benefits/cap.yaml b/policyengine_us/parameters/gov/states/id/tax/income/deductions/retirement_benefits/cap.yaml index 69a5d9b6be9..fe1f44e6e27 100644 --- a/policyengine_us/parameters/gov/states/id/tax/income/deductions/retirement_benefits/cap.yaml +++ b/policyengine_us/parameters/gov/states/id/tax/income/deductions/retirement_benefits/cap.yaml @@ -26,6 +26,8 @@ metadata: href: https://tax.idaho.gov/wp-content/uploads/forms/EIN00046/EIN00046_10-23-2024.pdf#page=32 - title: Idaho Individual Income Tax Instructions Packet 2025 href: https://tax.idaho.gov/wp-content/uploads/forms/EIN00046/EIN00046_03-02-2026.pdf#page=45 + - title: Social Security Administration, 2026 Social Security changes (maximum benefit for a worker retiring at full retirement age) + href: https://www.ssa.gov/news/en/cola/factsheets/2026.html SINGLE: 2021-01-01: 37_776 @@ -33,12 +35,19 @@ SINGLE: 2023-01-01: 43_524 2024-01-01: 45_864 2025-01-01: 48_216 + # 12 times SSA's 2026 maximum benefit for a worker retiring at full + # retirement age ($4,152 a month), as 63-3022A(2)(b) defines it. + 2026-01-01: 49_824 JOINT: 2021-01-01: 56_664 2022-01-01: 60_210 2023-01-01: 65_286 2024-01-01: 68_796 2025-01-01: 72_324 + # 63-3022A(2)(a) adds the benefit of a spouse who draws only on the + # worker's record. The Tax Commission's 2021-2025 amounts equal 1.5 times + # the single amount, as this one does. + 2026-01-01: 74_736 SEPARATE: # Per Idaho Form 39R instructions: "If you're married, you can't claim # this deduction if you file separately." (Idaho Code 63-3022A(2)(e)) @@ -51,6 +60,7 @@ SURVIVING_SPOUSE: 2023-01-01: 43_524 2024-01-01: 45_864 2025-01-01: 48_216 + 2026-01-01: 49_824 HEAD_OF_HOUSEHOLD: # Per Idaho Code 63-3022A(2)(b): "not married" taxpayers use single cap 2021-01-01: 37_776 @@ -58,3 +68,4 @@ HEAD_OF_HOUSEHOLD: 2023-01-01: 43_524 2024-01-01: 45_864 2025-01-01: 48_216 + 2026-01-01: 49_824 diff --git a/policyengine_us/tests/policy/baseline/gov/states/id/tax/income/deductions/retirement_benefits/id_retirement_benefits_deduction.yaml b/policyengine_us/tests/policy/baseline/gov/states/id/tax/income/deductions/retirement_benefits/id_retirement_benefits_deduction.yaml index 72f0567011f..06dd7b33458 100644 --- a/policyengine_us/tests/policy/baseline/gov/states/id/tax/income/deductions/retirement_benefits/id_retirement_benefits_deduction.yaml +++ b/policyengine_us/tests/policy/baseline/gov/states/id/tax/income/deductions/retirement_benefits/id_retirement_benefits_deduction.yaml @@ -135,3 +135,113 @@ output: id_retirement_benefits_deduction_relevant_income: 10_000 id_retirement_benefits_deduction: 10_000 + +# Idaho Code 63-3022A(2) caps the deduction at SSA's maximum benefit for a +# worker reaching full retirement age: $4,152 a month in 2026, so $49,824 for +# a single filer and 1.5 times that, $74,736, on a joint return. + +- name: Idaho 2026 retirement benefits cap for a single filer. + period: 2026 + input: + people: + person1: + id_retirement_benefits_deduction_relevant_income: 60_000 + tax_units: + tax_unit: + members: [person1] + filing_status: SINGLE + households: + household: + members: [person1] + state_code: ID + output: + id_retirement_benefits_deduction: 49_824 + +- name: Idaho 2026 retirement benefits cap on a joint return. + period: 2026 + input: + people: + person1: + id_retirement_benefits_deduction_relevant_income: 80_000 + person2: + id_retirement_benefits_deduction_relevant_income: 0 + tax_units: + tax_unit: + members: [person1, person2] + filing_status: JOINT + households: + household: + members: [person1, person2] + state_code: ID + output: + id_retirement_benefits_deduction: 74_736 + +- name: Idaho 2026 retirement benefits cap less Social Security retirement benefits. + period: 2026 + input: + people: + person1: + id_retirement_benefits_deduction_relevant_income: 60_000 + social_security_retirement: 20_000 + tax_units: + tax_unit: + members: [person1] + filing_status: SINGLE + households: + household: + members: [person1] + state_code: ID + output: + # 49,824 - 20,000 + id_retirement_benefits_deduction: 29_824 + +- name: Idaho 2026 retirement benefits cap for a head of household. + period: 2026 + input: + people: + person1: + id_retirement_benefits_deduction_relevant_income: 60_000 + tax_units: + tax_unit: + members: [person1] + filing_status: HEAD_OF_HOUSEHOLD + households: + household: + members: [person1] + state_code: ID + output: + id_retirement_benefits_deduction: 49_824 + +- name: Idaho 2026 retirement benefits cap for a surviving spouse. + period: 2026 + input: + people: + person1: + id_retirement_benefits_deduction_relevant_income: 60_000 + tax_units: + tax_unit: + members: [person1] + filing_status: SURVIVING_SPOUSE + households: + household: + members: [person1] + state_code: ID + output: + id_retirement_benefits_deduction: 49_824 + +- name: Idaho 2025 retirement benefits cap for a single filer stays $48,216. + period: 2025 + input: + people: + person1: + id_retirement_benefits_deduction_relevant_income: 60_000 + tax_units: + tax_unit: + members: [person1] + filing_status: SINGLE + households: + household: + members: [person1] + state_code: ID + output: + id_retirement_benefits_deduction: 48_216 From fdb199816e9cb5887cc57c697462ff22ded43da8 Mon Sep 17 00:00:00 2001 From: Max Ghenis Date: Sun, 8 Nov 2026 04:57:17 -0500 Subject: [PATCH 2/2] Describe Idaho's joint cap by the statute's words Co-Authored-By: Claude Opus 5.5 --- .../id/tax/income/deductions/retirement_benefits/cap.yaml | 6 +++--- 1 file changed, 3 insertions(+), 3 deletions(-) diff --git a/policyengine_us/parameters/gov/states/id/tax/income/deductions/retirement_benefits/cap.yaml b/policyengine_us/parameters/gov/states/id/tax/income/deductions/retirement_benefits/cap.yaml index fe1f44e6e27..3d57a271064 100644 --- a/policyengine_us/parameters/gov/states/id/tax/income/deductions/retirement_benefits/cap.yaml +++ b/policyengine_us/parameters/gov/states/id/tax/income/deductions/retirement_benefits/cap.yaml @@ -44,9 +44,9 @@ JOINT: 2023-01-01: 65_286 2024-01-01: 68_796 2025-01-01: 72_324 - # 63-3022A(2)(a) adds the benefit of a spouse who draws only on the - # worker's record. The Tax Commission's 2021-2025 amounts equal 1.5 times - # the single amount, as this one does. + # 63-3022A(2)(a) sets the joint amount for a worker whose spouse draws + # benefits only on the worker's record. The Tax Commission's 2021-2025 + # joint amounts equal 1.5 times the single amount, as this one does. 2026-01-01: 74_736 SEPARATE: # Per Idaho Form 39R instructions: "If you're married, you can't claim