IDAPA 35.01.01.335 — NONAPPORTIONABLE INCOME (RULE 335)

Section 63-3027(1)(h), Idaho Code
01.
Nonapportionable Income. Nonapportionable income is all income other than apportionable
income. All deductions relating to the production of nonapportionable income is to be allocated with the income
produced. Any allowable deduction that applies to both apportionable and nonapportionable income of the taxpayer
is to be prorated to those classes of income to determine income subject to tax. When used in these rules, the term
nonapportionable income includes nonapportionable losses unless the context clearly indicates otherwise.
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IDAHO ADMINISTRATIVE CODE
IDAPA 35.01.01
Idaho State Tax Commission
Income Tax Administrative Rules
Section 336
Page 53
02.
Offset of Interest Expense Against Nonapportionable Income. Interest on indebtedness incurred
or continued to purchase or to carry investment that generates nonapportionable income is offset against the income
produced. If the facts do not support such a matching of the interest expense to the nonapportionable income, the
portion of the taxpayer's interest expense that is offset against income from nonapportionable investments is to be an
amount that bears the same ratio to the aggregate amount allowable to the taxpayer as a deduction for interest for the
taxable year as the taxpayer's nonapportionable income mentioned in the preceding sentence bears to the taxpayer's
total income for the taxable year. Aggregate amount allowable means the taxpayer's total interest expense deducted in
determining taxable income as defined in Section 63-3011B, Idaho Code, plus interest expense disallowed under
Sections 265 and 291 of the Internal Revenue Code, plus interest expense from a pass-through entity, plus the interest
expense of a corporation that, pursuant to Sections 63-3027 and 63-3027B through 63-3027E, Idaho Code, is
included in a combined report with the taxpayer for the taxable year. See Rule 115 of these rules for the calculation of
total income.
(4-6-23)
03.
Allocated to Idaho. Nonapportionable income, net of interest and other related expense offsets,
that is attributable to Idaho is allocated to Idaho.
(4-6-23)
04.
Allocated to Other States. Nonapportionable income, together with interest and other related
expense offsets, is allocated to other states if it is not attributable to Idaho.
(4-6-23)