In 2018, the Iowa legislature enacted Senate File 2417, a state tax reform bill that included extensive changes to the state’s tax structure. The Department has released updated guidance to explain the following tax change:
In December of 2019, President Trump signed the Taxpayer Certainty and Disaster Tax Relief Act of 2019 into law. This Act extends a number of expired federal tax provisions, many retroactively to tax years 2018 and 2019. Iowa has not conformed with any of these federal tax changes to the extent they apply to tax years beginning prior to January 1, 2020.
The Department is reminding taxpayers that Iowa has not extended the due date for Estimated Income Tax Payments. The second quarter installment of tax year 2020 estimated income tax for taxpayers filing on a calendar year basis is due June 30, 2020.
On March 23, 2018, President Trump signed into law the Consolidated Appropriations Act, 2018 (P.L. 115-141). Among other changes to the Internal Revenue Code (IRC), this bill included a fix to the so called “grain glitch,” which occurred when IRC section 199 was repealed under Tax Cuts and Jobs Act (TCJA) in 2018.
The Department of Revenue recognizes travel/hospitality is one of many industries that has been severely impacted by the recent pandemic. This also impacts local governments and organizations in those communities that benefit from Iowa’s hotel/motel tax. The Department collects the tax and distributes the funds back to local governments on a quarterly basis.
Local Government Officials:
The Department of Revenue has received questions from many of you regarding the impact of COVID-19 on local option sales tax collections. We have been monitoring and will continue to monitor the situation. At this time, we have decided not to make any adjustments to the current monthly estimates for Fiscal Year 2020.