Iowa Net Operating Losses (NOL) are generally carried back two years, except for losses incurred in Presidentially-declared disaster areas (3-year carryback), casualty and theft losses (3-year carryback), and losses incurred by individuals engaged in farming (5-year carryback). See IA 123 (pdf) for further guidance regarding carrybacks and carryforwards.
Any federal election which is made to forego a NOL carryback period is not binding for Iowa purposes. Taxpayers may elect to waive the Iowa NOL carryback period. The election applies to the entire Iowa NOL and shall be made by the due date for filing the taxpayer’s Iowa income tax return, including the extension of time to file. After the election is made for any taxable year the election shall be irrevocable. When the election has been properly made the Iowa NOL shall be carried forward up to 20 taxable years.
If you do not elect to waive your carryback period, farmers may elect to carry the farming NOL back five years and forward up to 20 years. The election shall be made by the due date for filing the taxpayer’s Iowa income tax return, including the extension of time to file.
See Other Adjustments line 24, code "u"
View additional information related to the 3-year carryback period for Iowa NOLs incurred by individuals during the COVID-19 Pandemic