Note: Additional Information

To amend your return you must file an IA 1040, check the box in Part I, and include an IA 102 Iowa Amended Return Schedule. The IA 1040X has been discontinued and should not be used. Amended returns may be submitted electronically. Check with your software vendor regarding whether filing an amended return electronically is supported. Amended returns should not be submitted on the same day as the original return. To correct errors or misstatements on your original filing, you must submit a new IA 1040 with an IA 102. Include an explanation of the changes. If you file an amended federal return, include the federal 1040X with your submission.

If you owe additional tax:

Calculate the tax, and any penalty and interest due. You may make your payment online for the current year or pay with a credit card. To pay by check or money order, print an IA 1040XV payment voucher to send in with your check. order, print an IA 1040XV payment voucher to send in with your check. Visit EasyPay Iowa for more information about your payment options.

A person can be a resident of only one state at any given time. Usually, it is clear which state that is. Normally, it is the state in which one lives and works. Occasionally, however, the question of residency can be a little more difficult to answer. If a person moves during the year, or for some reason spends an extended period of time outside the state, the actual state of residence may not always be as obvious.

Intent of Individual

The issue of residency hinges mainly on the intent of the individual. That intent is often clear and easy to determine. If a person moves from one state to another with the intent of changing residence, that person will take certain actions. They will typically take obvious steps to eliminate ties and contacts with the former state, and establish similar ties and contacts with the new state. In some cases, however, the actions taken by the individual may create some confusion as to the actual intent.

Factors to Measure Intent

When a person's intent is not readily apparent, several factors are used as a guide to measure that intent. No single factor can be used. All the facts and circumstances of the case must be weighed in their totality to determine a person's intent and residency.

Some of the factors used in this analysis are listed below:

• Are you registered to vote in Iowa?
• Have you voted (in person or by absentee ballot) in an Iowa election?
• Do you or any of your family attend Iowa schools?
• Do you have an Iowa telephone listing and service?
• Do you receive your mail in Iowa?
• Do you have an Iowa driver's license?
• Do you hold any business or professional licenses in Iowa?
• Do you hold an Iowa hunting or fishing license?
• Is your automobile registered in Iowa? Do you have Iowa license plates?
• Are any boats or recreational or all-terrain vehicles registered in Iowa?
• Do you own a home in Iowa?
• Is your home larger than your home in any other state?
• Do you claim homestead or military credits for property tax?
• Do you keep your valuables, mementos, collections, jewelry, or prized personal possessions in Iowa?
• Do you live in Iowa for more days of the tax year than in any other state?
• Do you live in any other state for more days of the tax year than in Iowa?
• Do you receive income from an Iowa source?
• Do you receive services from doctors, dentists, attorneys, CPAs, or any other professionals located in Iowa?
• Do you have an active membership in an Iowa church, club, professional or civic organization in Iowa, and participate as a result of the membership?
• Do you claim a benefit on the federal income tax return based on an Iowa home being the principal place of business?
• Do you have active checking or savings accounts or use of safe deposit boxes located in Iowa?
• Do you have a location of employment in Iowa or active participation in a business within Iowa?
• Is Iowa the state of residency in your Last Will and Testament?

Please keep in mind that no single factor will typically be sufficient to make a residency determination. When viewed as a whole, the answers to the above questions will generally give a good indication as to the individual's intent, and therefore, to the state of residence.

Residency Rules

For more details on the subject of residency, including several examples, please refer to Iowa Administrative Code rule 701-300.17.

Servicemembers and Their Spouses

Servicemembers and their spouses should reference Iowa Tax Responsibilities of Servicemember and their Spouses for additional information.

Residents of other states who need a certified copy of the Iowa return for filing with their state of residence must include an extra copy of their Iowa return and a self-addressed stamped envelope when they file. A note stating the purpose of the extra copy should be included. The Department will stamp the copy and return it to you.

Taxpayers provide confidential tax information to the Iowa Department of Revenue in the form of individual income tax returns and other Iowa schedules, forms, and supporting documentation.

Your tax information is kept confidential by the Department, with a few exceptions as required by law. Most notably, information from your return may be made available to the Internal Revenue Service or to tax officials of another state for tax administration purposes.

Any Iowa Department of Revenue employee who discloses tax return information without legal authority is guilty of a serious misdemeanor, subject to a fine, incarceration, and civil damages. The Department will discuss confidential tax information only with the taxpayer, unless the taxpayer has properly authorized another individual to speak with or represent the taxpayer regarding the relevant tax year and issue. For more information, see Confidentiality, Disclosure, and Authorized Representation.

If you do not provide individual income returns or the necessary information to support the return, or if you provide fraudulent information, you may be charged penalties and interest and may be subject to criminal prosecution.

Although Iowa and the IRS may have the same type of credit, it may or may not be refundable on both returns.

Nonrefundable Tax Credit

A nonrefundable tax credit will reduce your tax liability. This credit may reduce your tax liability down to zero, but it will never generate a refund. An example of this type of credit is the Tuition and Textbook Credit or any other credit taken in Step 5 of the IA 1040 individual income tax form.

Refundable Tax Credit

A refundable tax credit will also reduce your tax liability. However, if this tax credit exceeds your tax liability it will generate an Iowa refund. An example of this type of credit is the Iowa Child and Dependent Care Credit or any other credit taken in Step 6 of the IA 1040 individual income tax form.

Payments through your Tax Software

Direct Debit payment with the income tax return

A Direct Debit is a tax payment electronically withdrawn from your bank account through the tax software used to electronically file individual income or corporation income tax returns. You will need to enter your bank routing number and your bank account number.

Note: You receive credit for making the payment on the date you indicate the Department should withdraw it from your bank account. This may be the date you send it, or a date in the future if you request the payment to be warehoused for withdrawal at a later date. Please allow a week after the withdrawal date for your bank to post it to your account.

Why Direct Debit through your tax software?

(Check with your software vendor for the features that are provided.)

• You control the date when the payment is withdrawn from your bank account.
• You may pay the entire amount or a portion of the balance due.
• You choose whether the payment is withdrawn from your checking or savings account.

Need to cancel a Direct Debit payment made through your tax software?

• Email the Department's Payment Processing team
  • Include this information in your email:
        1. Taxpayer name
        2. Payment amount
        3. Scheduled pay date
        4. Taxpayer's daytime phone number
  • PAYMENT PROCESSING will return a cancel confirmation email
     

Payments through GovConnectIowa

• Visit govconnect.iowa.gov
• Using the Quick Pay option and selecting Make a Return Payment without setting up a GovConnectIowa logon will not provide an option to view history of payments made.
• Create a logon to take full advantage of GovConnectIowa including viewing up-to-date balance, return status, and payment history.

Note: If paying by credit/debit card, a service fee will be charged by the credit card processing vendor. This service fee is retained by the vendor and is not revenue to the Iowa Department of Revenue.

Need to cancel a Direct Debit payment made through GovConnectIowa?

For more information, visit GovConnectIowa Help.
 

Other Payment Information

Need to change the timing of a payment or update bank account information?

We cannot make these changes for you, you must cancel the payment (see above) and resubmit a payment in one of the following ways:

• Through your tax software
• Pay through our website using govconnect.iowa.gov
• Mail us a check or money order

Payments by Check or Money Order...

Mail a check or money order with an IA 1040V Payment Voucher payable to: Iowa Department of Revenue. Payments must be at least $1. Write the type of tax being paid and the tax year being paid on the check or money order. The address for mailing is on the IA 1040V Payment Voucher.

Payment Plans

Pay as much as you can, and you will be billed for the balance due. You can make payments prior to receiving a bill from the Department.

Note: You must have received a bill from the Department before you can set up a formal payment plan.

Iowa does not have a formal payment plan option prior to receiving a bill from the Department. However, if you are unable to pay your Iowa tax liability in full, file the return and pay what you can by the due date. If you do not file your return by the due date, and at least 90% of the correct tax is not paid, you owe an additional 5% late penalty on the unpaid tax. By filing the return on time, even if at least 90% of the correct tax due isn’t paid, you only owe an additional 5% late penalty on the unpaid tax.

You may pay online through govconnect.iowa.gov.

If paying by check or money order, mail a check or money order with an IA 1040V Payment Voucher payable to Iowa Department of Revenue. Write the type of tax being paid and the tax year being paid on the check or money order. Do not send in any payment of less than one dollar. The mailing address is on the voucher.

You will be billed for the balance after your return is processed, including any penalty 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. 
Questions about payment plans? View Pay Delinquent Tax.

Iowa Residents

Iowa residents who expect to owe Iowa income tax of $200 or more from income not subject to withholding tax must make estimated tax payments to avoid a penalty for underpayment of estimated tax. For additional information, see IA 1040ES instructions (45-009).

Farming or Commercial Fishing

If at least two-thirds of your income is from farming or commercial fishing, you may avoid penalty for underpayment of estimated tax in one of the following ways: (1) You may pay the estimated tax in one payment on or before January 15, 2025, and file your return by April 30, 2025, or (2) you may file your return and pay the tax in full by March 1, 2025.*

Nonresidents

Nonresidents with nonwage income from Iowa, see IA 1040ES instructions (45-009).

Married Taxpayers filing Jointly

Estimated tax payments should be filed under the primary taxpayer’s name and SSN.

Married Taxpayers filing Separately

Each individual required to make estimated tax payments must file an estimated payment under their name and Social Security Number.

How to Pay

You can set up your payments to be automatically deducted from your bank or credit union account using govconnect.iowa.gov, in person or by mail. Simply select Individual Income Estimate Tax and the payment option that works best for you using EasyPay Iowa.

• Installment 1 – April 30
• Installment 2 – June 30
• Installment 3 – September 30
• Installment 4 – January 31

The tax period listed on the payment voucher, if applicable, should reflect the end date (commonly December 31) for which the payment is to be applied. The installment date should not be listed as the tax period.

* If the due date falls on a Saturday, Sunday, or holiday as defined in Iowa Code section 421.9A, then the due date is the following day that is not a Saturday, Sunday, or holiday.

The Department does not have an extension form to obtain additional time to file. A federal extension does not apply for Iowa purposes.

If at least 90% of your total tax liability is paid by April 30, 2025, you will automatically have an until October 31, 2025, to file your return timely. You will not be charged a late file penalty. However, you may owe an IA 2210 penalty for failure to make estimated payments. You will owe interest on any tax still due after April 30, 2025.

If the due date falls on a Saturday, Sunday, or holiday as defined in Iowa Code section 421.9A, then the due date is the following day that is not a Saturday, Sunday, or holiday.

How to determine if 90% of the tax you owe has already been paid:

Multiply the amount on IA 1040, line 20 by 90% (0.90).

If the result is equal to or less than the amount on IA 1040, line 30, an extension is automatic.

Example:

Total state and local tax before contributions from IA 1040, line 20 = $5,000

$5,000 x 90% = $4,500

Total credits from IA 1040, line 30 = $4,000

90% of the tax has not been paid. No extension is available to this taxpayer. This taxpayer will owe penalty and interest on the unpaid tax.

Example:

Total state and local tax before contributions from IA 1040, line 20 = $3,000

$3,000 x 90% = $2,700

Total credits from IA 1040, line 30 = $2,850

This taxpayer receives an automatic extension until October 31, 2025 and will pay only interest on the unpaid tax.

If you need to make a tax payment to meet the 90% requirement, you may:

• arrange payment from your bank account, or by credit/debit card through govconnect.iowa.gov
• use the IA 1040V payment voucher form

If at least two-thirds of your income is from farming or commercial fishing, you may avoid penalty for underpayment of estimated tax in one of the following ways:

1. Pay the estimated tax in one payment on or before January 15, 2025, and file the Iowa income tax return by April 30, 2025, or
2. File the Iowa income tax return and pay the tax due in full on or before March 1, 2025. An IA 2210F is required to be filed with the Iowa income tax return, and the applicable box on IA 1040 Line 35 must be checked.

If the due date falls on a Saturday, Sunday, or holiday as defined in Iowa Code section 421.9A, then the due date is the following day that is not a Saturday, Sunday, or holiday.

Bonus Depreciation

Bonus depreciation is available for Iowa tax purposes for assets placed in service in a tax year beginning on or after January 1, 2021. See IA 4562A&B for required adjustments for assets placed in service in a tax year beginning before January 1, 2021.

Section 179

For tax years beginning on or after January 1, 2020, the IRC section 179 limitations and phase-out threshold for Iowa purposes are the same as federal. See IA 4562A&B for required adjustments.

Injured spouse: The federal “injured spouse” form is not recognized by the State of Iowa when using filing status 2 (married filing jointly). If your filing status is married filing jointly, your refund will be used to pay a federal, state, county, or city debt owed by either spouse.

See Refunds May Be Used to Pay Debt.

Relief from Joint and Several Liability

Married taxpayers are generally jointly and severally liable for the total tax, penalty, and interest from a joint return. However, a person who meets the criteria for relief from joint and several liability established in Section 6015 of the Internal Revenue Code may be relieved of liability for an understatement of tax that is attributable to erroneous items of the other spouse.

A married taxpayer filing a return with a spouse can qualify for relief from joint and several liability only if the taxpayers file a joint return. A married taxpayer who files a separate return that has been accepted by the state will not be eligible for relief from joint and several liability.

Time Period for Requesting Relief from Joint and Several Liability

Relief from joint and several liability must be requested within two years of the date on the Notice of Assessment. However, an extended time period to request equitable relief is available for taxpayers who satisfy the criteria under Section 6015(f) of the Internal Revenue Code and, if applicable, Internal Revenue Service Notice 2011-70.

For additional information related to relief from joint and several liability, see Iowa Administrative Code rule 701–300.15.

How to Request Innocent Spouse Relief:

• Follow the process described in the Notice of Assessment
• Go to govconnect.iowa.gov
• Under the Individuals section, select Request Innocent Spouse Relief
• Complete the on-screen prompts

Notification of Non-Requesting Spouse

When a taxpayer requests innocent spouse relief, the Department may notify the non-requesting spouse or former spouse of the request for relief. The notice will advise the non-requesting spouse or former spouse of their right to intervene by filing a notice of intervention with the Department.

Iowa's only income tax reciprocal agreement is with Illinois.

Any wages or salaries earned by an Iowa resident working in Illinois are taxable only to Iowa and not to Illinois. Any wages or salaries earned by an Illinois resident working in Iowa are taxable only to Illinois and not to Iowa.

Iowa will tax any Iowa-source income received by an Illinois resident that is not from wages or salaries. Illinois may tax any Illinois-source income received by an Iowa resident that is not from wages or salaries.

Iowa gambling winnings and unemployment compensation for employment in Iowa are examples of income that are not wages and salaries and, therefore, not covered under the Iowa-Illinois Reciprocal Agreement.

Iowa Resident Working for Wages or Salary in Illinois

An Iowa resident working for wages or salary in Illinois should complete and file Illinois form IL-W-5-NR Employee's Statement of Non-residence in Illinois with the employer so that the employer will withhold Iowa income tax.

Illinois Resident Working for Wages or Salary in Iowa

An Illinois resident working for wages or salary in Iowa should complete and file the Employee's Statement of Nonresidence in Iowa, 44-016 with the employer so that the employer will withhold Illinois income tax.

Tax Withheld in Error

If Illinois income tax has been mistakenly withheld from the wages or salary of an Iowa resident, the Iowa resident must file an Illinois income tax return to get a refund. Any questions on how to complete the Illinois return should be directed to the Illinois Department of Revenue at 800-732-8866.

Illinois residents who had Iowa income tax withheld in error from their wages and have no other Iowa-source income must file an Iowa income tax return requesting a refund. They should complete IA 1040, Steps 1, 2, and 3, show “0” on IA 1040, lines 1, 4, and 20, write “Illinois resident tax withheld in error” on the face of the return. Also include an IA 126 with Part I completed showing $0 of Iowa source income. Part II of the IA 126 does not need to be completed in this situation. Enter the Iowa tax withheld on IA 1040, lines 28 and 30 through 32. Sign the return and include copies of all W-2s with the return. Copies of federal and Illinois returns must be included.

Definitions

• "Native Americans" means all persons of Native American Indian descent who are members of any recognized tribe.
• "Settlement" means all land within the boundaries of any recognized Native American settlement or reservation within the State of Iowa.

Native Americans living on the settlement of their own tribe

Taxable Income:

• Wages for working off the settlement
• Income from business or real estate located off the settlement

Exempt Income:

• Wages from working on the settlement
• Income from business or property located on the settlement
• Interest, dividends, and other income from intangibles, regardless of where the bank accounts, financial institutions, etc., are located

Native Americans living off the settlement of their own tribe

If Residents of Iowa:

• Taxed in the same manner as other residents. (Income from working on the settlement is taxable.)

If Nonresidents of Iowa:

• Taxed in the same manner as other nonresidents. (Income from working on the settlement is taxable.)

Persons who are not tribal member Native Americans, regardless of whether they live on or off the settlement

If Residents of Iowa:

• Taxed in the same manner as other residents. (Income from working on the settlement is taxable.)

If Nonresidents of Iowa:

• Taxed in the same manner as other nonresidents. (Income from working on the settlement is taxable.)

Resident Servicemembers

Iowa residents who are members of the armed forces, armed forces military reserve, and the National Guard in an active duty status can exclude pay received from the federal government for military service performed. “Active duty,” for Iowa tax purposes, has the same meaning as defined in 10 U.S.C. § 101(d)(1).

Iowa residents who are members of the military should include the active duty pay received from the federal government for military service performed as income on the IA 1040, line 1a and deduct the same active duty pay on IA 1040, Schedule 1, line 6. These individuals should provide an IA W-4 to the payer of this income, claiming exemption from withholding on active duty pay. Service members claiming this exclusion should be prepared to send a copy of their active duty military orders to the Department if requested to do so.

When must a resident servicemember file an Iowa income tax return?

If a servicemember is an Iowa resident, they must file an Iowa individual income tax return if they:

• are married and their combined income* totals more than $13,500 ($32,000 if you or your spouse is 65 or older on 12/31/24)
• are single and his or her total income* is more than $9,000 ($24,000 if 65 or older on 12/31/24)
• have income* of $5,000 or more and is claimed as a dependent on another person's Iowa return
• are filing as head of household or qualifying surviving spouse and his or her total income* is more than $13,500 ($32,000 if you or your spouse is 65 or older on 12/31/24)

*Income does not include pay received from the federal government for military service performed by members of the armed forces, armed forces military reserve, and the National Guard in an active duty status.

School District Surtax (Iowa Administrative Code rule 701—304.1)

The school district surtax is applicable for resident members of the armed forces of the United States living in an Iowa school district, even if the member is not physically present in Iowa on the last day of the tax year.

What income is subject to Iowa tax? (Iowa Administrative Code rule 701—302.76)

Military pay to Iowa residents must be included on the IA 1040, line 1a to the same extent it is included on the federal return regardless of where the person is stationed when it is received.

Other income earned by an Iowa resident stationed in or out of Iowa is also taxable to Iowa to the same extent it is taxable on the federal level. If any of that income is correctly taxed by another state, then Iowa allows an Out-of-State Tax Credit on the IA 1040. This credit is calculated on the IA 130 form, which must be included with the IA 1040 along with a copy of the other state's return.

What income is not subject to Iowa tax?

Active Duty Pay

Iowa resident members of the armed forces, armed forces military reserve, and the National Guard in an active duty status can exclude pay received from the federal government for military service performed. “Active duty,” for Iowa tax purposes, has the same meaning as defined in 10 U.S.C. § 101(d)(1).

NOTE: Members who are employed full-time in the National Guard (as defined in Title 32 of the U.S. Code) are not considered in an active duty status, so their pay is not excluded from Iowa tax.

Include all income on line 1 with other W-2, 1099, or W-2G income. Qualifying military income is then deducted on IA 1040, Schedule 1, line 6.

Combat Zone Pay

Income excluded by the federal government is also excluded for Iowa income tax purposes. For example, combat zone pay is excluded on the Iowa return because it is excluded for federal income tax purposes.

The federal Military Family Tax Relief Act of 2003 provides for a number of tax breaks related to military personnel. Iowa follows the federal treatment of the military adjustments to gross income.

The Internal Revenue Service (IRS) website is your best source of qualifying combat zones and tax breaks related to military personnel. See www.irs.gov/individuals/military.

Military Student Loan Exemption (Iowa Administrative Code rule 701—302.63)

Military student loan repayments included in federal taxable income are exempt from Iowa income tax if the following criteria are met. This exemption may be taken by persons in the:

• armed forces
• armed forces military reserve
• National Guard

The individual must be on active duty at the time of the loan repayment.

If the loan repayment amount is included on IA 1040, line 2, then deduct it on IA 1040, Schedule 1, line 19 using code "t".

Military Retirement Pay

Retirement pay for military service in the United States Armed Forces, the Armed Forces Military Reserve, or the National Guard is eligible for exemption from Iowa income tax, without regard for age or disability. 

The Army, Navy, Air Force, Marine Corps, and Coast Guard make up the Armed Forces. Only military retirement pay received from the Defense Finance and Accounting Service (DFAS), or a similar source, is eligible for the exemption.

Retirement pay received from other sources, including the Office of Personnel Management (OPM), does not qualify for the exemption. In particular, retirement pay resulting from participation in the Civil Service Retirement System (CSRS) or the Federal Employees Retirement System (FERS) does not qualify for the exemption.

For more details, see Iowa Administrative Code rule 701—302.80.

Deduct qualifying military retirement pay included in federal taxable income on IA 1040, Schedule 1, line 4.

Exclusion of Distributions from Retirement Plans by National Guard members and members of military reserve forces of the United States (Iowa Administrative Code rule 701—302.58)

If a National Guard member or member of the military reserve is called to National Guard duty or federal active duty and makes a withdrawal from a qualified retirement account of the member, the amount of the withdrawal is not subject to Iowa income tax or state tax penalty. If this income is reported as taxable pension income, enter that amount on the IA 1040, Schedule 1, line 4.

Deferral of Collection of State Income Tax (Servicemembers Civil Relief Act)

The Servicemembers Civil Relief Act (SCRA) is a federal law that, among other things, requires the Department to allow a deferral of collection of state income tax if a servicemember’s ability to pay is materially affected by their military service. The deferral lasts for only a period of up to 180 days after termination or release from military service. The SCRA only defers collection of income tax that has fallen due before or during military service. Servicemembers must still file their income tax returns, unless their duty to file is suspended by another authority.

Do You Qualify?

1. You must be a “servicemember.”
   1. Members of the Army, Navy, Air Force, Marine Corps, Coast Guard, and commissioned corps of the National Oceanic and Atmospheric Administration and of the Public Health Service are servicemembers under the SCRA.
   2. Members of the National Guard and reserves are servicemembers under the SCRA only if those members are serving under a call to active service authorized by the President or the Secretary of Defense for a period of more than 30 consecutive days.
2. You must serve during a period of “military service.”
   1. In the case of Army, Navy, Air Force, Marine Corps, or Coast Guard, a servicemember is serving in a period of military service if they are on “active duty.”
   2. In the case of commissioned officers of the National Oceanic and Atmospheric Administration or Public Health Service, a servicemember is serving in a period of military service if they are in “active service.”
   3. In the case of members of the National Guard and reserves, a servicemember is serving in a period of military service if they are serving under a call to active service authorized by the President or the Secretary of Defense for a period of more than 30 consecutive days.
3. You must be “materially affected” by your military service.
   1. The Department will consider all relevant facts and circumstances in determining whether servicemembers' ability to pay their income tax has been materially affected by their military service.
4. You must be in “filing compliance.”
   1. Servicemembers can receive a deferral of collection of income taxes only for periods in which they have filed an income tax return.
5. You must file a written request for deferral.
   1. Servicemembers must make a written request for deferral of collection of income to the Department by completing the Request for Deferral of Iowa Income Tax form.

Servicemembers must submit a copy of their orders with their Servicemember Request for Deferral of Iowa Income Tax (41-024).

Forgiveness of Tax (Iowa Administrative Code rule 701—301.11)

Iowa income tax is forgiven if an individual’s federal income tax was forgiven because:

• the individual was killed in a combat zone, or
• the individual is missing in action and presumed dead, or
• the individual was killed outside the United States due to terrorist or military action while they were a military or civilian employee of the United States

Single status

Iowa income tax is forgiven for the tax year in which the individual was killed or was missing and presumed dead and for the tax year prior to the year of death.

Married / year of death

All tax is forgiven for the year of death if the deceased was married at the time of death and his or her filing status is married filing joint for that tax year.

Married / prior year

All tax is forgiven if the deceased was married at the time of death and a joint return or a married filing separate return was filed for the year prior to death. Please note that if the deceased had filed using the married filing separately on the combined return status, only the state income tax attributable to the deceased will be forgiven. Prior-year returns cannot be amended to change the filing status. (Iowa Administrative Code rule 701—301.11).

Applying for Forgiveness of Tax

To claim forgiveness of tax for an individual who was killed in military or terrorist action, or who is missing in action and presumed dead, the person filing an Iowa income tax return or an Iowa claim for refund should write at the top of the return “Forgiveness of Tax—Killed in Military Action” or “Forgiveness of Tax—Killed in Terrorist Action” depending on how the deceased was killed. A copy of the deceased’s death certificate, or other evidence that establishes that the deceased was killed in military or terrorist action or is missing in action and presumed dead, should be attached to the income tax return or to the claim for refund. Claims for refund will only be honored if the claim for refund is made within the statute of limitations for claims for refund provided in Iowa Code section 422.73.

Return Due Date and Extensions (Iowa Administrative Code rules 701—301.12 and 701—301.14)

The usual filing deadline for Iowa income tax returns is April 30. If 90% of the tax due is paid by that time, the usual deadline is extended to October 31. No extension form is available or required.

Qualifying individuals may be granted extensions under certain circumstances for filing returns and for other acts related to the Department. These are listed below.

Who qualifies for an extension?

• Active duty military servicemembers in the armed forces, armed forces military reserve, or National Guard who are deployed outside the United States
• A person serving in support of those forces
• A spouse of a person listed above if they file jointly or if they are a party with the eligible taxpayer to any other act related to the Department
• An eligible individual who was continuously hospitalized because of illness or injury in the combat zone

“Other acts related to the Department” includes:

• Filing claims for refund for any tax administered by the Department
• Making tax payments other than withholding payments
• Filing appeals on the tax matters
• Filing other tax returns
• Performing other acts described in the Department’s rules

Applying for the Extension

To claim the extension, eligible taxpayers, and, if applicable, their spouses, should notify the Department of their eligibility by sending the information described below to the Department:

• Taxpayer’s name and spouse’s name
• Taxpayer’s date of birth and spouse’s date of birth
• Taxpayer’s U.S. address and spouse’s address
• Date of taxpayer’s deployment overseas
• For military personnel, an official document that indicates taxpayer’s deployment
• For qualifying civilians, a letter of authorization, a similar letter from the taxpayer’s employer, or a letter from the military stating that the taxpayer served in a “tax-free zone” or “Combat Zone Tax Exclusion Area (CZTE)”

The taxpayer, the taxpayer’s spouse, or an authorized agent or representative of the taxpayer may submit the notification of eligibility to the Department.

Extension Periods

In general, the additional time period for filing state returns and performing other acts related to the Department is 180 days.

IRS Military Web Page

For further information about federal tax provisions governing military personnel, go to the IRS website at: www.irs.gov/individuals/military.

Nonresident Servicemembers

The Servicemembers Civil Relief Act (SCRA) is a federal law that, among other things, protects servicemembers from losing their home state residency simply by being absent from their home state in compliance with military orders. The SCRA also protects servicemembers from establishing residency simply by being in another state where they are located pursuant to military orders.

Residency (Iowa Administrative Code rule 701—300.17)

Each person has one and only one state of residence. A person may be a resident of a state even though they do not actually live in the state.

When is a servicemember an Iowa resident?

A servicemember is an Iowa resident if:

• the servicemember was a resident of Iowa at the time of enlistment or
• the servicemember has declared Iowa to be his or her “military home of record” or
• the servicemember has taken positive action to establish residency in Iowa

A person remains an Iowa resident until positive action is taken to establish residency in another state.

See Are You a Resident of Iowa for Tax Purposes above.

Establishing residency in another state

To establish residency in another state, a servicemember should first complete form DD2058, State of Legal Residence Certificate, which is available from the payroll officer of the Military Office of Personnel. However, completion of this form, alone, does not establish residency.

A combination of the actions listed below is required to establish legal residence in another state.

• physical presence in the other state
• registering to vote in the other state
• changing driver’s license
• registering vehicles in the other state
• applying for other privileges offered by the other state
• payment of real estate tax or income tax in the new state

If steps are not taken to change residency, a servicemember remains a resident of Iowa and is subject to Iowa income tax laws.

The Director of the Iowa Department of Revenue may require an individual to provide proof that residency has been established in another state.

Nonresident Military Income

Beginning with tax year 2003, the following apply for Iowa as a result of the Servicemembers Civil Relief Act:

Compensation for military service is not considered to be Iowa-source income for nonresident servicemembers. However, nonresident servicemembers who have Iowa income from sources other than compensation for military service may be subject to Iowa income tax.

In general, the Servicemembers Civil Relief Act applies only to active duty members of the Army, Navy, Air Force, Marine Corps, or Coast Guard and to commissioned officers of the Public Health Service or the National Oceanic and Atmospheric Administration who are in active service. Generally, this does not include the National Guard or reserve personnel.

Exceptions exist for nonresident members of the National Guard who are under active duty orders under Section 502(f) of Title 32 of the United States Code and for servicemembers who are absent from duty under specific circumstances.

Servicemembers who are not residents of Iowa are required to file Iowa income tax returns if their all-source income meets the above requirements and their Iowa-source income is $1,000 or more. The nonresident servicemember includes all income as instructed on IA 1040, lines 1 and 2, and reports any compensation for military service as a modification to federal total income  on the IA 1040 Schedule 1, line 6. The net result is a reduction of the tax rate on any other Iowa-source income.

Once this is done, the nonresident turns to another Iowa form, the IA 126 Nonresident and Part-Year Resident Schedule. Only Iowa-source income is included on this form and will not include military pay when calculating the credit. That credit is entered on the IA 1040, line 13, and is designed to minimize the taxation of income by Iowa and the other state.

Nonresidents and part-year residents must file both the IA 1040 and the IA 126 with a complete copy of the federal return.

IRS Military Web Page

For further information about federal provisions that may impact military personnel, go to the IRS website at www.irs.gov/individuals/military.

Spouses of Servicemembers

Under the Military Spouses Residency Relief Act of 2009 (MSRRA), the Veterans Benefits and Transitions Act of 2018 (VBTA), and the Veterans Auto and Education Improvement Act of 2022, the spouses of servicemembers may be exempt from Iowa income tax on income from services performed in Iowa if they are not residents of Iowa. Servicemembers’ spouses are protected, by federal law, from losing their home state residency simply by being absent from their home state in order to be with the servicemember spouse who is elsewhere in compliance with military orders. Federal law also protects servicemembers’ spouses from establishing residency simply by being in another state where they are located to be with the servicemember spouse pursuant to military orders. Spouses covered by the MSRRA can establish new residency when they take positive action to do so.

Under the MSRRA and Iowa law, a servicemember’s spouse’s income from wages, salaries, tips, etc., may be excluded from Iowa income tax if:

• the servicemember spouse is a member of the uniformed services present in Iowa in compliance with his or her orders
• the non-servicemember spouse is present in Iowa solely to be with the servicemember spouse, and
• the non-servicemember spouse is a resident of another state.

Under the VBTA, a servicemember’s spouse’s income from wages, salaries, tips, etc., may be excluded from Iowa income tax if:

• the non-servicemember spouse elects to use the same residence as the servicemember spouse for tax purposes.

Under the Veterans Auto and Education Improvement Act of 2022, a spouse of a service member may retain their personal residence or domicile for purposes of taxation.  Under the act, a servicemember and the spouse of the member are authorized to elect to use the following locations for purposes of taxation:

• the residence or domicile of the member,
• the residence or domicile of the spouse, or
• the permanent duty station of the member.

Other income, like interest income or rental income, is included in a nonresident spouse’s Iowa income and may be taxed in Iowa.

Iowa W-4

The IA W-4 includes information related to this federal law. If you claim this exclusion, check the appropriate box on the IA W-4 and enter the state other than Iowa you are claiming as your state of domicile or residence for tax purposes. Attach a copy of your spousal military identification card to the IA W-4 form provided by your employer.

Filing Iowa Income Tax Returns

Spouses who are eligible for the spouses of servicemembers exemption should report all-source income on the IA 1040, but should show no Iowa wages, salaries, tips, or Schedule C income on the IA 126. Enter the amount from IA 126, line 32, on IA 1040, line 13.

Iowa income tax withheld should be entered on IA 1040. line 28. Then complete the remainder of the IA 1040 to determine the amount of any refund that may be due.

IRS Military Web Page

For further information about federal tax treatment military personnel and their spouses, go to the IRS website at www.irs.gov/individuals/military.

Taxpayers who are paid in foreign currency must convert the currency to U.S. dollars as required for federal tax purposes.

Mail to:

Iowa Income Tax - Document Processing
P.O. Box 9187
Des Moines IA 50306-9187

Make checks payable to: Iowa Department of Revenue

• Include IA 1040V payment voucher with payment.

Electronic options are available for paying additional tax:

Make a Payment on govconnect.iowa.gov

• Using the Quick Pay option and selecting Make a Return Payment without setting up a GovConnectIowa logon will not provide an option to view history of payments made.
• Create a logon to take full advantage of GovConnectIowa including viewing up-to-date balance, return status, and payment history.

Note: If paying by credit/debit card, a service fee will be charged by the credit card processing vendor. This service fee is retained by the vendor and is not revenue to the Iowa Department of Revenue.

Direct Debit payment with the income tax return

• You may be able to make a direct debit payment through your software when you file electronically.
• You may be able to schedule the payment for a future date through your tax software.
• Your tax payment is made from your savings or checking account without having to write a check.
• See other payment options using EasyPay

For tax years beginning on or after January 1, 2023, Iowa will incorporate the federal net operating loss (NOL) and will no longer allow an Iowa-specific NOL. Taxpayers should use the IA 124 form to calculate the amount of any pre-2023 federal NOL carryforward that must be added back or any pre-2023 Iowa NOL that may be deducted. Follow the IA 124 form instructions for reporting the pre-2023 NOL adjustment amounts.  

A nonresident or part-year resident of Iowa must complete the IA 1040 reporting the individual’s total income, including income earned outside Iowa. The taxpayer is allowed adjustments to income on the same basis as if the taxpayer were a resident of Iowa.

The nonresident or part-year resident may then complete a Schedule IA 126. On the IA 126, only Iowa income is reported and a percentage of Iowa income to total income is determined. The taxpayer receives a credit against the initial tax liability based on the percentage of income from outside Iowa. Therefore, the result of this credit is that only Iowa-source income is taxed.

Although non-Iowa income is used to calculate the initial tax liability at the appropriate tax rate, the non-Iowa income itself is not subject to tax. By using this method, Iowa taxes the Iowa-source income of nonresidents and part-year residents at the same rate it taxes Iowa residents. Iowa, like many states and the federal government, uses a graduated tax rate system based on level of income

A nonresident of Iowa with all-source income of $250,000 and $10,000 of Iowa income, will use the same tax rate as an Iowa resident with $250,000 of income to calculate their initial tax liability, rather than using the same tax rate as an Iowa resident with $10,000 of total income. For more information, see IA 126.

A part-year resident may also complete the IA 130 if they have income earned while an Iowa resident which is taxed by another state, local jurisdiction, or foreign country. For more information, see IA 130.

Income which is not taxable for Iowa purposes should not be reported on the IA 126 or IA 130.  Examples of types of income which are taxable for federal purposes but are excluded for Iowa purposes on Schedule 1 include:

• Social Security Benefits
• Active Duty Military Pay
• IRA/Pension/Railroad Retirement Income
• Railroad Unemployment Income

Iowa gambling winnings are taxable in Iowa even if the winner is not an Iowa resident.  Nonresidents should complete the IA 1040, showing income from all sources, including Iowa gambling winnings, lines 1 through 12.

Then use the IA 126 to determine your credit based upon the percentage of Iowa income to total income.

This credit should be entered on IA 1040, line 13, then complete the remainder of the return.

Include a copy of your federal return.

Iowa individual income tax returns and all supporting documentation, including federal returns and all relevant schedules, should be kept for at least 10 years after filing the return.

If you have unreported income or fraudulent filings, the statute of limitations for examination by the Department is unlimited.

The state setoff program is a method State of Iowa public agencies may use to collect past-due (delinquent) debts (for example, child support payments) that are owed.

The state setoff program matches people and businesses who owe delinquent debts with money that is owed to those people and businesses (for example, an income tax refund). Sources of funds available for setoff include, but are not limited to, tax refunds, casino and sports wagering winnings, State-issued vendor payments, and Iowa Lottery winnings. To the extent allowed by law, when a match occurs, the Iowa Department of Revenue withholds or sets off money to apply toward the delinquent debt. State of Iowa Setoff Program requirements are outlined in Iowa Code section 421.65 and Iowa Administrative Code 701—Chapter 26.

To learn more, visit the State of Iowa Setoff Program.

Information for Businesses and Individuals

Do you purchase items from out of state or through the internet, catalogs, magazines, or vendors who advertise on television or radio? Will those items be used in Iowa? Would they be subject to Iowa sales tax if purchased in Iowa?

Are you paying tax on those purchases? If not, you owe Iowa use tax on the purchase price. 

If you purchase tangible personal property for use in Iowa and the seller does not charge you Iowa tax on the purchase, you owe a 6% tax known as the use tax on the price of the purchase.

Individuals:

Individuals without a permit who rarely make purchases subject to use tax should pay their tax in one of the following ways:

• Electronically through EasyPay Iowa
• Complete the Iowa Non-Permit Use Tax Return (32-007)

Anyone who regularly purchases merchandise from out of state for their own use in Iowa should register for a use tax permit and pay the tax. 

Businesses:

Businesses making taxable purchases on a regular basis should register with the Iowa Department of Revenue to file use tax returns. However, some businesses may only occasionally make purchases for their own use and owe Iowa use tax. If this type of purchase is not typical for your business, instead of separately registering for use tax, you can report the purchase on the Total Taxable Purchases line of your monthly or annual sales and use tax return or file and pay the tax as outlined for individuals above.

For more information, see our Sales and Use Tax Guide.

Each year many Iowans do not get W-2s from their employers by the January 31 date required by the IRS.

If you have moved:

Contact your employer with your new address.

If you simply have not received it:

Contact your employer and try to find out why you have not received the W-2.

If you still do not receive it:

You may also call the IRS at 800-829-1040. They will work with you and explain the steps needed to receive a substitute W-2.

Iowa will accept a copy of the substitute W-2 filed with the IRS. However, the substitute W-2 may not show Iowa withholding. No credit for Iowa withholding can be given in this case unless you have pay stubs that show Iowa withholding.

If you need a W-2 from a previous year, here are some other possible options:

• Social Security Administration (SSA) - may provide copies of Forms W-2 for retirement purposes at no charge and for other than retirement purposes for a fee. Call 1-800-772-1213, or visit the SSA website at www.ssa.gov for instructions on how to obtain wage information from the SSA.
• Internal Revenue Service (IRS) - may provide an exact copy of a previously filed and processed tax return with attachments (including the form W-2). You should complete federal Form 4506, Request for Copy of Tax Return, and mail it to the address listed in the instructions. A fee will be charged for each tax year requested.

Note: The Iowa Department of Revenue is not able to provide you with a copy of your W-2 information.