Reform Guidance - Individual Itemized Deductions for Tax Year 2018

On December 22, 2017, President Donald Trump signed Public Law 115-97, commonly referred to as the Tax Cuts and Jobs Act (TCJA). This law made numerous changes to the itemized deductions claimed by individuals in calculating their individual income taxes. 

Iowa Senate File 2417, an extensive state tax reform bill to improve Iowa’s tax structure signed by Iowa Governor Kim Reynolds on May 30, 2018, conforms with many provisions of the federal TCJA, but in most cases not until tax years beginning on or after January 1, 2019. As a result, Iowa individual income taxes for tax year 2018 will generally be calculated using the Internal Revenue Code (IRC) in effect on January 1, 2015, so there will be significant differences between federal and Iowa itemized deductions which may require Iowa adjustments.

This guidance highlights and summarizes the major differences between federal and Iowa itemized deductions resulting from Iowa’s conformity or nonconformity for tax year 2018 with federal Public Law 114-113 (Protecting Americans from Tax Hikes Act of 2015), the TCJA, Public Law 115-123 (Bipartisan Budget Act of 2018), Public Law 115-141 (Consolidated Appropriations Act of 2018), and certain federal regulation changes. 

This guidance is not intended to provide a comprehensive analysis of all itemized deductions available under Iowa law. The Iowa tax treatment of these deductions may be different for tax years 2019 or later.

Read on below to discover the differences between 2018 federal and Iowa itemized deductions.

Download the information on this page as a printable PDF.