How to Prorate

Taxpayers using filing status 3 (married filing separately on a combined return) or status 4 (married filing separate returns) may be required to prorate (divide) certain entries on the IA 1040, such as reportable Social Security benefits, federal income tax refunds, estimated federal tax payments, itemized deductions, etc.

Example 1: How spouses would prorate a federal refund:

2021 federal refund received in 2022 from a jointly-filed return: $1,000
Spouse A has net income of $15,000 on the 2021 IA 1040.
Spouse B has net income of $30,000 on the 2021 IA 1040.
Total net income: $45,000 on the 2021 IA 1040.

Divide Spouse B's net income by total net income. $30,000 ÷ $45,000 = 66.7%
The result is the percent of total net income earned by Spouse B.

Then multiply the total 2021 federal refund amount by the result above $1,000 X 66.7% = $667. This is Spouse B's portion of the refund, reported on line 27 in column B.

Subtract Spouse B's portion of the refund from the total 2021 federal refund amount. $1,000 - $667 = $333. This is Spouse A's portion of the refund reported on line 27 in column A.

These two amounts are entered on 2022 IA 1040, line 27.

Note: Round to the nearest one-tenth of a percent. For example, 66.74% becomes 66.7% and 66.75% becomes 66.8%

Example 2: How to prorate Social Security benefits

Spouse A receives Social Security benefits of $30,000
Spouse B receives Social Security benefits of $20,000
Total Social Security benefits are $50,000

Divide Spouse A's Social Security benefits by the total Social Security benefits. $30,000 ÷ $50,000 = 60%
The result is the percent of total Social Security benefits earned by Spouse A.

Complete the Iowa Social Security worksheet to determine what amount is reportable to Iowa. In this example, the total reportable Social Security benefits are $8,000. Now prorate the $8,000 between spouses.

Multiply the total reportable Social Security benefits by the result above. $8,000 X 60% = $4,800. This is Spouse A's portion of reportable Social Security benefits to be entered in column A of step 4.

Subtract Spouse A’s portion of reportable Social Security benefits from the total reportable Social Security benefits. $8,000 - $4,800 = $3,200. This is Spouse B’s portion of reportable Social Security benefits to be entered in column B of step 4.

Example 3: Federal estimated tax payment proration

Spouse A has income of $75,000 that is not subject to federal withholding.
Spouse B has income of $8,000 that is not subject to federal withholding.
Their total income not subject to federal withholding is $83,000.
The estimated federal tax payments for this year totaled $18,000.

Divide Spouse A's income that is not subject to federal withholding by the total income not subject to federal withholding. $75,000 ÷ $83,000 = 90.36% (rounded to 90.4%). The result is the percent of income not subject to federal withholding earned by Spouse A.

Multiply the total estimated federal tax payments made for the tax year by the percentage above. $18,000 X 90.4% = $16,272 This is Spouse A's portion of estimated federal tax payments to be entered on line 32 in column A.

Subtract Spouse A’s portion of estimated federal tax payments from the total estimated federal tax payments. $18,000 - $16,272 = $1,728 This is Spouse B's portion of estimated federal tax payments to be entered on line 32 in column B.