COVID-19

On March 19, 2020, the Director of the Department of Revenue issued Order 2020-01 granting certain filing and payment extensions pursuant to Iowa Code section 421.17(30) following the Governor’s Proclamation of Disaster Emergency in response to the recent outbreak of the COVID-19 virus.

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Frequently Asked Questions

This guidance document is intended to answer frequently asked questions from taxpayers relating to these recent events. This page will be updated periodically as questions are received by the Department, so please consult this page regularly before contacting the Department. Additional information from other state agencies and the Governor’s Office can be found at coronavirus.iowa.gov/.

If you have a question that is not answered below, please submit your question through the Request for Tax Guidance. The Department is monitoring the Request for Tax Guidance page daily to prioritize and get taxpayers the information they need as quickly as possible.

  • The Iowa Department of Revenue, Iowa Economic Development Authority (IEDA), and the Governor's Office partnered to provide a small business relief program to businesses impacted by the COVID-19 pandemic. While the IEDA deadline for a small business relief grant has expired, the Iowa Department of Revenue will continue receiving applications from businesses requesting a tax deferral. Complete and submit a Small Business Relief Tax Deferral application to request deferral.


    Who is eligible for the deferral and waiver of penalty and interest?

    All sales tax and/or withholding tax permit holders can apply by filling out the Small Business Relief Tax Deferral application. Factors considered during application review: industry type; current standing with the Department; and, economic loss related to COVID-19.

    What exactly does “tax deferral” mean?

    If a tax deferral is granted by the Iowa Department of Revenue, a taxpayer will be given 60 days to pay their balance due for the applicable taxes. Penalties would be waived and interest would be waived for the first 60 days after the original due date. Interest would begin to accrue 61 days after the original due date on the original tax due.

    What taxes are included in the deferral and waiver of penalty and interest?

    Sales tax, including any consumer’s use tax reported by a taxpayer on a sales tax return, and withholding tax are included. Retailer’s use tax and consumer’s use tax are not eligible.

    Does this apply to returns or just payments due?

    Returns and payments for sales and withholding, due between March 20, 2020 and April 30, 2020 are eligible.

    When will I hear back from the Department?

    The Department will contact you, either in writing or by phone, if a tax deferral was requested. Our goal is to respond to applications received within two week.

    What if the 60-day deferral isn’t sufficient?

    If you need additional time to pay your balance due, please contact the Department to discuss payment arrangements.

    What if I’m unable to make payments for more than one sales and/or withholding tax return? Do I need to request assistance for each return?

    No. For example, if you were unable to pay the return due March 20, and you anticipate not being able to pay the return due April 30, both payments can be deferred now. Please indicate on your application what periods you are asking to be deferred.

    Can I request a refund of the sales tax and/or withholding tax I already submitted to the Department?

    No, the Department will not refund payments already remitted.

  • On March 19, 2020, Governor Reynolds issued another Proclamation of Disaster Emergency temporarily suspending the imposition of penalty and interest on certain property tax payments.


    Are property tax payment deadlines extended?

    The Governor has issued a proclamation that waives penalty and interest that would have accrued if someone did not pay property tax by April 1, 2020. If someone doesn't pay by April 1, 2020, the person would still be technically "delinquent," he or she just wouldn't owe penalty and interest for the late payment. Treasurers will still have authority to send a delinquency notice if payment is not received ahead of April 1, 2020.

  • NOTE: If you need to cancel a scheduled Income Tax payment, view the Need to cancel a Direct Debit payment? instructions from Do You Owe Tax? Here Are Your Payment Options.


    Is the Department still processing tax refunds and rent reimbursements?

    Yes, so far the Department’s operations have not been affected by the changes related to the Department’s safety procedures. State income tax refunds currently are being processed at about the 30-day mark. Taxpayers can check the status of their refunds at the Department’s website where’s my refund page.

    Does the filing and payment extension affect the deadline for filing amended returns and requesting refunds for previous income tax years?

    No, the filing and payment extension only applies to affected returns with a due date on or after March 19, 2020, but before July 31, 2020. Under Iowa law, a claim for refund or credit must be filed within 3 years of the date the return became due, or within 1 year of the date the payment of tax was made, whichever is later. For example, a refund request related to tax previously paid with a 2016 individual income tax return filed on April 30, 2017, must be made on an amended individual income tax return no later than April 30, 2020, in order to be considered timely.

    The Order mentions estates and trusts, does the filing and payment extension affect IA 706 Inheritance Tax Returns?

    No. Deadlines for the IA 1041 Fiduciary Income Tax Return filed by estates and trusts are extended by the Order, but the Order does not extend payment and filing deadlines related to the IA 706 Inheritance Tax Return. The regular deadline for paying Iowa inheritance tax reported on an IA 706 is the last day of the 9th month following the death of the decedent.

    Does the filing and payment extension apply to taxpayers that file returns on a fiscal-year basis?

    Yes, the filing and payment extension applies to any tax return and associated tax payment listed in Order 2020-01 with a due date on or after March 19, 2020, but before July 31, 2020. The filing and payment extension does not apply to estimated tax payments. For information about estimated tax payments, see the Estimated (Income Tax) Payments section below.

    Does the due date extension apply to previously extended returns?

    Yes, previously extended tax returns that have an extended due date on or after March 19, 2020, but before July 31, 2020, benefit from the filing extension to July 31, 2020, granted in Order 2020-01. Note, however, that under Iowa law an automatic extension only extends the time to file a return, not to pay the tax. Therefore, taxpayers with tax due prior to March 19, 2020 (the start date of Order 2020-01) may accrue interest on the balance of unpaid tax. The suspension of interest provided in Order 2020-01 only applies to interest that accrues between March 19, 2020, and July 31, 2020. If you believe you were assessed interest on unpaid tax for the period covered by Order 2020-01, please contact the Department using the information provided on your Notice of Assessment.

    Example: Corporation XYZ’s 2018 tax year began on July 1, 2018, and ended June 30, 2019. Corporation XYZ paid 90% of the tax due with regard to its 2018 IA 1120 by the original filing deadline of October 31, 2019. Therefore, Corporation XYZ was automatically granted a 6-month extension, until April 30, 2020, to file its 2018 IA 1120 return. Because this April 30, 2020, extended deadline falls within the time period covered in the Order, and because the IA 1120 is a return listed in the Order, corporation XYZ has until July 31, 2020, to file its 2018 IA 1120. Interest is due on any remaining tax due with regard to its 2018 IA 1120 from November 1, 2019, until such time the tax is paid, except that interest is not due during the period covered by the Order (March 19, 2020, through July 31, 2020).

  • Does the filing and payment extension apply to required estimated income tax payments?

    No.

    Are income tax estimated payments still required to be made by their regular due date?

    Yes. For example, a calendar-year filer’s 1st quarter and 2nd quarter 2020 estimated payments are due on April 30, 2020, and June 30, 2020, respectively.

  • Have the sales and use tax due dates and payment dates been extended?

    No, the Department has not extended any sales and use tax due date. The filing and payment due date for sales and use tax remain as normal. But, as described below, taxpayers can apply for relief on a case-by-case basis from March 24 through March 30.

    Are there any options related to sales and use tax payments or filings?

    The Iowa Department of Revenue worked with the Iowa Economic Development Authority (IEDA) and the Governor's Office to provide assistance to businesses impacted by COVID-19. From March 24 through March 31, IEDA accepted applications for small business relief grants as well as tax deferral. While the IEDA is no longer awarding grants, the Iowa Department of Revenue will continue receiving applications to grant tax deferral. Complete and submit a Small Business Relief Tax Deferral application to request deferral. Submitting an application does not guarantee assistance. The Iowa Department of Revenue tax deferral request applies to deferring payment of tax, waiving penalty, and waiving interest for 60 days.

    Taxpayers that are not granted relief through the application process described above may be qualified for relief from penalty (but not interest) if they meet one of the reasons described in Iowa Code section 421.27. Requests for a penalty waiver are made on the Department’s Penalty Waiver Request, 78-629.

  • Does the extension for withholding payments by semi-monthly depositors that are due on March 25, 2020, to the new due date of April 10, 2020, also apply to bulk filers?

    Yes, the extension relates to both the semi-monthly data and payment regardless of whether the taxpayer chooses to file themselves or through a service provider.

    Is there a way to request an extension for withholding payments and other withholding filings not covered by the Order?

    The Iowa Department of Revenue worked with the Iowa Economic Development Authority (IEDA) and the Governor's Office to provide assistance to businesses impacted by COVID-19. From March 24 through March 31, IEDA accepted applications for small business relief grants as well as tax deferral. While the IEDA is no longer awarding grants, the Iowa Department of Revenue will continue receiving applications to grant tax deferral. Complete and submit a Small Business Relief Tax Deferral application to request deferral. Submitting an application does not guarantee assistance. The Department referral is in regards to deferring payment of tax, as well as waiving penalty and interest.

    Taxpayers that are not granted relief through the application process described above may be qualified for relief from penalty (but not interest) if they meet one of the reasons described in Iowa Code section 421.27. Requests for a penalty waiver are made on the Department’s Penalty Waiver Request, 78-629.