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Expanded Instructions
  • Line: 25
  • Step: 6
  • Step Subject: Refundable Credits and Payments
  • Instruction Year: 2023

The Iowa Earned Income Tax Credit is a refundable credit. This credit is available only to taxpayers who qualify for the federal Earned Income Tax Credit (EITC). To calculate the Iowa Earned Income Tax Credit, multiply your federal EITC by 15% (.15).

To find out if you qualify for federal EITC, see the IRS EITC information or call the IRS at 800-829-1040.

If you are filing an Iowa return ONLY to claim EITC

If you qualify for the low income exemption and are filing an Iowa return only to claim a refund of the Iowa EITC, check the box between Steps 4 and 5. Skip lines 5 through 19, enter zero on lines 20 and 22, and enter the amount of your Iowa EITC on lines 25, 30, 31, and 32.

Nonresidents and Part-year Residents

The Iowa EITC must be adjusted using the following formula.

Nonresidents and Part-year Residents
Iowa net income (IA 126, line 25)   ___________________________
divided by
All-source net income of you and spouse (IA 126, line 26)
(The ratio cannot exceed 100%)
รท ___________________________
multiplied by the Iowa Earned Income Tax Credit x __________________________
equals credit on line 25