Iowa Income Tax FAQs

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1. Rates: What are Iowa's income tax rates?

2. Due dates: When are my income taxes due?

3. Mail to: Where do I send my return?

4. Owing tax: What if I am unable to pay in full?

5. Lower income benefit: What is the Alternate Tax Computation?

6. Mistake?: How do I amend an income tax return?

7. Overdue tax: How are penalty and interest calculated?

8. Filing requirements: Who must file an Iowa income tax return?

9. Filing status: Which one should I use?

10. Standard deduction: What are the amounts for each filing status?

11. Federal Earned Income Tax Credit: How much can I claim on my Iowa return?

12. Child and Dependent Care Credit: Who can claim it?

13. Pension exclusion: Who is eligible?

14. Federal refund: How much was my federal refund last year?

15. Tuition and Textbook Credit: Who can claim it?

16. Health insurance deduction: Who can take it?

17. Extensions: How do I get an extension to file my Iowa return?

18. Exempt from tax: Are low-income filers exempt from tax?

19. Tax help: Does the Department offer tax help?

20. W-2s: What should I do if I don't receive a W-2 from my employer?

21. Iowa Nonresident and Part-Year Resident Credit: What is the Schedule IA 126?

22. Out-of-State Credit Computation: What is the Schedule IA 130?

23. Vehicle registration fee: Is part of the fee paid each year deductible on the Iowa return?

24. E-File: Electronic filing options for Iowa Income Tax

25. Confidentiality: Are Department employees required to abide by any confidentiality laws?

Iowa 1040 Expanded Instructions are found on our income tax forms page.

1. What are Iowa's income tax rates?

The long form tax tables and the short form tax tables are available on our income tax forms page.

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2. When are my income taxes due?

Iowa current-year income tax returns are due on April 30 of the following year. When filing on paper, we use the postmark date to determine if a return is filed on time. When e-filing, the transmittal date is used.

If April 30 falls on a Saturday or Sunday, the due date is the following Monday.

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3. Where do I send my return?

If you file electronically, you will receive your refund in days instead of weeks. However, if you are filing by mail, use the following address:

ALL INDIVIDUAL INCOME TAX FORMS
Iowa Income Tax Document Processing
PO Box 9187
Des Moines IA 50306-9187

Even if you mail your return, you can still pay online through eFile & Pay. ePay is free.

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4. What if I'm unable to pay in full?

If you are unable to pay your tax liability in full, file the return and pay what you can by the due date. Filing on time will reduce the penalty on the unpaid balance from 10% to 5%.

You may pay online through eFile & Pay. ePay is free.

If paying by check or money order, use the IA 1040V payment voucher, which is available on our income tax forms page.

You will be billed for the balance after your return is processed, including any penalty and/or interest that may be due. We encourage you to make payment prior to receiving a bill in order to reduce the interest amount due. Interest will accrue on the first of each month until the balance is paid.

The interest rate may change yearly. Interest must be added to delinquent tax at a per month rate, beginning on the due date of the return and accruing each month until you make full payment of all tax, penalty, and interest due.

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5. What is the Alternate Tax Computation?

The Alternate Tax Computation may benefit some low-income taxpayers by reducing the amount of tax they owe. If your net income is greater than $13,500, and you are not using filing status 1 (single), you may owe less tax by using the Alternate Tax Computation.

If you or your spouse is 65 or older on December 31 of the tax year and you are not using filing status 1 (single), you may benefit from the Alternate Tax Computation if your net income is greater than $32,000.

A worksheet is available. Instructions can be found in the online Expanded Instructions, which are available on our individual income tax forms page.

Complete the worksheet to determine if the Alternate Tax Computation would reduce the amount of tax you owe. If it does, use this amount on your return rather than the amount from the tax table.

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6. How do I amend an income tax return?

Wait until your original return has been processed before sending in an amended return. Our examiners may correct your error for you.

If you have a refund coming from the first return you filed for the current year, wait until you receive that refund from us. This way you will be sure that your first return had no errors on it.

If you need to amend your current or any prior year's return:

Amend your current-year return online: Some online filing companies allow the state return to be filed without the federal return for the current year.

Statute of Limitations:

If you have a refund coming, you must file your original or amended return within three years of the due date. After that time, no refund will be granted. However, you may still be required by law to file.

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7. How are penalty and interest calculated?

No penalty is charged if 90% of the correct tax is paid by the original due date of the return.

A penalty of 10% will be added to the tax due if the tax return is not filed by the due date and at least 90% of the correct tax is not paid by that date.

If the return is filed timely but you cannot pay the tax in full, a penalty of 5% will be added to the additional tax due if at least 90% of the correct tax is not paid by the due date.

NOTE: You will never be subject to both the 5% and 10% penalties. The penalty will be the applicable 5% or 10%, but not a total of 15%.

The interest rate may change yearly. Interest must be added to delinquent tax at a per month rate, beginning on the due date of the return and accruing each month until you make full payment of all tax, penalty, and interest due.

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8. Who must file an Iowa income tax return?

You must file an Iowa income tax return if you were a resident, part-year resident, or nonresident of Iowa during the tax year and meet any of the following requirements.

The income of both husband and wife must be combined in meeting the filing requirements.

Filing status single

You must file if...

You had a net income of more than $9,000.

If 65 or older on December 31 of the tax year, net income of more than $24,000.

Filing status other than single

You must file if...

You had a net income of more than $13,500.

If 65 or older on December 31 of the tax year, net income of more than $32,000.

Claimed as a dependent on another person's Iowa return

You must file if...

You had a net income from all sources of $5,000 or more.

Military

You must file if...

You were in the military service, with Iowa shown as your legal residence even if stationed outside of Iowa.

Iowa lump-sum tax or Iowa minimum tax

You must file if...

You were subject to either Iowa lump-sum tax or Iowa minimum tax.

Nonresidents

You must file if...

You were a nonresident and your net income from Iowa sources was $1,000 or more.

You were a nonresident and subject to Iowa lump-sum tax or Iowa minimum tax.

Refund

You must file if...

You owe no tax but wish to claim a refund of Iowa tax withheld from your paycheck.

Iowa Earned Income Tax Credit

You must file if...

You are eligible for and want to claim an Iowa Earned Income Tax Credit.

Net Operating Loss (NOL)

You may wish to file if...

You have a NOL, to establish that loss, even if not otherwise required to file an Iowa return.

The Department recommends an IA 1040 be filed in a year that generates income, even if a loss carryforward wipes out that income.  Filing a return in this situation reduces the chances of being contacted by the Department about that income in the future.

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9. Which filing status should I use?

  1. Single - Check filing status 1 if you were unmarried, divorced, or legally separated on December 31 and you do not meet the requirements for any other filing status.
  2. Married Filing a Joint Return - Check filing status 2 if you want to report your income, deductions and exemptions together and
    • You were married on December 31, or
    • Your spouse died during the year.

If both of you have Iowa income, you may pay less tax if you file status 3 or 4.

  1. Married Filing Separately on a Combined Return - Check filing status 3 if you are married and want to file separately on one return. If you receive a refund, it will be made payable to both you and your spouse. Both of you must sign the return. You may file separate Iowa returns even if you file a joint federal return. If you use filing status 3 (married filing separately on this combined return) complete both columns A and B of the IA 1040. Using this status is usually beneficial to married taxpayers who both have income.
  2. Married Filing Separate Returns - Check filing status 4 if you and your spouse file separate returns. You may file separate Iowa returns even if you file a joint federal return. Each return must be filed with all supporting schedules. The “Injured spouse” designation is not recognized by the State of Iowa when using “married filing a joint return,” filing status 2, or “married filing separately on a combined return,” filing status 3. If your spouse's refund will be used to pay a federal, state, county or city debt, you must use filing status 4, “married filing separate returns” to prevent your refund from being applied to your spouse's debt.
  3. Head of Household - Check filing status 5 if you are filing as "head of household" for federal income tax purposes. If you are filing as "qualified widow or widower with dependent child" for federal income tax purposes, you may not file as "head of household" on your Iowa return.
  4. Qualifying Widow or Widower with Dependent Child - Check filing status 6 if you meet the requirements for qualifying widow or widower for federal income tax purposes.

Note: Complete only Column A of the IA 1040 for filing statuses 1, 2, 4, 5, and 6.

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10. What are the standard deduction amounts for each filing status?

Standard deduction amounts can be found in the online Expanded Instructions, which are available on our individual income tax forms page.

The standard deduction goes on line 41 of the IA 1040, which is the long form.

The standard deduction is built into the tax tables for the short form (1040A), so it is not entered as a separate line item on that form.

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11. How much of the federal Earned Income Tax Credit can I claim on my Iowa return?

Beginning with tax year 2007, the Iowa EITC is a refundable credit. This means that you may want to file an Iowa return to claim the Iowa EITC even if you are not otherwise required to file. For tax year 2010 and subsequent years, multiply your federal EITC by .07 (7.0%) to calculate the Iowa credit.

If you did not file a federal income tax return, you may want to review the instructions for federal 1040 or 1040A to determine if you are eligible to claim the federal EITC.

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12. Who can claim the Child and Dependent Care Credit OR the Early Childhood Development Credit on the IA 1040?

Beginning with tax year 2006, one of the two credits may be taken -- Child and Dependent Care Credit OR Early Childhood Development Credit. Only taxpayers with a net income of less than $45,000 are eligible to take one of these credits.

If you are choosing the Early Childhood Development Credit, you may take the credit equal to 25% of the first $1,000 of qualifying expenses paid for each dependent from the ages of three through five.

If you are married, your net income and the net income of your spouse must be combined to determine if you qualify, even if your spouse does not file an Iowa return.

These credits are refundable. Even though you may not be required to file an Iowa return, you may wish to do so in order to claim a refund for whichever credit benefits you the most.

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13. Who is eligible for the pension exclusion?

If you or your spouse receive a pension, annuity, self-employed retirement plan, deferred compensation, IRA, or other retirement plan benefits, you may be eligible to exclude from Iowa income tax a portion of the retirement income that is taxable on your federal return. Distributions on Roth IRAs are exempt from income tax. Social Security benefits are not included.

The exclusion can be up to $6,000 for individuals who file status 1, 5, or 6 and up to $12,000 for married taxpayers who file status 2, 3, or 4. If, for example, an individual has $5,000 in pension/retirement income, the exclusion will be the actual $5,000, not the maximum of $6,000.

To take this exclusion you or your spouse must meet one of the following conditions:

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14. How much was my federal refund last year?

If you need to determine the amount of last year's federal income tax refund, which must be reported on this year's Iowa return, please contact the Internal Revenue Service (IRS). Their telephone number is 1-800-829-1040. The Iowa Department of Revenue does not have this information available, and, therefore, cannot provide you with the information.

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15. Who can claim the Tuition and Textbook Credit?

Taxpayers who have one or more dependents attending grades KINDERGARTEN THROUGH TWELVE in an Iowa school may take a credit for each dependent for amounts paid for tuition and textbooks. The credit is 25% of the first $1,000 paid for each dependent for tuition and textbooks. Dependents must have attended a school in Iowa that is accredited under section 256.11, not operated for a profit, and adheres to the provisions of the U.S. Civil Rights Act of 1964.

In the case of divorced or separated parents, only the spouse claiming the dependent can claim the amounts paid by that spouse for tuition and textbooks for that dependent.

"Tuition" means any charges for the expense of personnel, buildings, equipment, and materials other than textbooks, and other expenses that relate to the teaching of only those subjects legally and commonly taught in Iowa’s public elementary and secondary schools. "Textbooks" means books and other instructional materials used in teaching those same subjects. Extracurricular activities, driver's education, sporting events, speech activities, and activities of a similar nature may be included.

Amounts paid are not allowed if the amounts relate to teaching of religious tenets and doctrines of worship. Tuition does not include charges made to compensate a school for feeding, lodging, clothing, or transporting a dependent.

More detail is available in our individual income tax expanded instructions, which can be found on our individual income tax forms page.

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16. Who can take the health insurance deduction?

On line 18 of the IA 1040, enter 100% of the amount paid for health and dental insurance premiums on a post-tax basis. This includes all supplemental health insurance, such as Medicare B supplemental medical insurance and Medicare D voluntary prescription drug insurance program (not “Medicare tax withheld” on your W-2), and long-term nursing home coverage. It may be to your advantage to take the deduction on line 18 instead of Schedule A. Schedule A may not contain any health insurance premiums which were used as a deduction on line 18.

Note that no deduction is available to any individual who paid health insurance premiums on a pre-tax basis. Pre-tax means to subtract such things as health insurance premiums from your gross wages before withholding taxes are computed. See your payroll department regarding pre-tax information.

Married Separate Filers:

If one spouse is employed and has health insurance premiums paid through his or her wages, that spouse will claim the entire deduction. If both spouses pay health insurance premiums through their wages, each spouse will claim what was individually paid.

If both spouses have self-employment income, the deduction for self-employed health insurance must be allocated between the spouses in the ratio of each spouse's self-employment income to the total self-employment income of both spouses. If health insurance premiums are paid directly by one spouse, that spouse will claim the entire deduction. If paid by both spouses, such as through a joint checking account, then allocate this deduction between the spouses in the ratio of each spouse's net income to the total net income of both spouses.

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17. How do I get an extension to file my Iowa return?

Income tax returns are due on April 30 following the tax year. If April 30 falls on a Saturday or Sunday, the due date is the following Monday.

Iowa has no paper extension form. If you have at least 90% of the tax paid by the due date, you will automatically have until October 31 to file the return.

If an additional payment is necessary in order to meet the 90% requirement, you must make payment using the Iowa Individual Income Tax Payment Voucher (41-137). Vouchers can be found on our individual income tax forms page. If 90% of the correct tax is not paid timely, penalty, and interest apply. You can also pay online through eFile & Pay. ePay is free direct debit.

Interest will accrue on any tax not paid by the original due date.

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18. Are low-income filers exempt from tax?

If your income is under a certain amount, you may be exempt from Iowa tax and not required to file an Iowa income tax return.

Filing status single

You are exempt from Iowa income tax if:

You had a net income of $9,000 or less

If you are 65 or older on December 31 of the tax year, net income of $24,000 or less

Filing status other than single

You are exempt from Iowa income tax if:

You had a net income of $13,500 or less

If you are 65 or older on December 31 of the tax year, net income of $32,000 or less

Claimed as a dependent on another person’s Iowa return

You are exempt from Iowa income tax if:

You had a net income of less than $5,000

To receive a refund if you are exempt

If you had Iowa income tax withheld from your paycheck and you are exempt, you will need to file an Iowa income tax return to receive a refund.

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19. Does the Department offer tax help?

You can reach a tax specialist by...

Iowa income tax expanded instructions are available on our income tax forms page.

20. What should I do if I don't receive a W-2 from my employer?

Each year many Iowans have trouble getting their W-2s from their employers by the January 31 date required by the IRS.

If you have moved, call your employer with your new address.

If you still have a problem, first go back to your employer and inquire as to why you have not received your W-2 and state that you need to obtain a duplicate W-2.

Since employers are not required to send copies of W-2s to the Iowa Department of Revenue, we are not able to furnish them to you. The Social Security Administration (SSA) will provide copies of forms W-2 for retirement purposes at no charge. They charge a fee for other than retirement purposes. Call 1-800-772-1213, or visit the SSA Web site at www.ssa.gov for instructions on how to obtain wage information from the SSA.

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21. What is the Schedule IA 126 - Iowa Nonresident and Part-Year Resident Credit?

This schedule is used for part-year resident taxpayers who moved into or out of Iowa during the tax year and for taxpayers who are not or have not been Iowa residents but have income taxable to Iowa.

It is used to calculate a tax credit. This schedule is sent with the Iowa 1040 income tax long form and a copy of your federal income tax return.

This form is available on our individual income tax forms page.

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22. What is the Schedule IA 130 - Out-of-State Credit Computation?

This schedule is used to compute an out-of-state credit for Iowa residents who earned income from, and are being taxed by, another state while living in Iowa.

This schedule is sent with the Iowa 1040 income tax long form and with a copy of the income tax return you filed with the other state. A copy of your federal income tax return should also be sent with these forms.

This form is available on our individual income tax forms page.

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23. Is the vehicle registration fee deductible on the Iowa income tax return?

If you itemize deductions, a portion of the automobile or multipurpose vehicle registration fee you paid in the tax year may be deducted as personal property tax on your Iowa Schedule A and federal Schedule A.

This deduction is for registration fees paid based on the value of qualifying automobiles and multipurpose vehicles. Multipurpose vehicles are defined as motor vehicles designed to carry not more than 10 people, and constructed either on a truck chassis or with special features for occasional off-road operation [Iowa Code section 321.1(44)]. Registration fees on the following vehicles are not deductible: pickups, motor trucks, work vans, ambulances, hearses, non-passenger-carrying vans, campers, motorcycles, or motor bikes.

See the instructions for line 37 of the IA 1040 for guidance on how to calculate this deduction.

24. eFile: Electronic filing options for Iowa Income Tax

25. Are Department employees required to abide by any confidentiality laws?

Yes. Please refer to this confidentiality statement for more details.

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