The Iowa Department of Revenue has released new guidance as it reflects to Sales Tax.

The Iowa Department of Revenue is issuing updated income tax withholding formulas and tables for 2021 to continue to align Iowa withholding with recent changes in state tax laws.

For individuals, this means that employers will be reducing the amount of Iowa tax withheld from employees’ paychecks, beginning January 1, 2021, increasing take-home wages for individuals.

As a result of the August 10, 2020, derecho storm that affected Iowa, the Internal Revenue Service extended until December 15, 2020, certain tax-filing and tax-payment deadlines falling on or after August 10, 2020, and before December 15, 2020. The Iowa Department of Revenue has not extended deadlines for returns and other forms with an original due date during this period.

Des Moines, Iowa – The Iowa Department of Revenue has finalized individual income tax brackets and individual income tax standard deduction amounts for the 2021 tax year (applicable for taxes due in 2022) and the 2021 interest rate, which the agency charges for overdue payments.

Interest Rates

Starting January 1, 2021, the interest rate for taxpayers with overdue payments will be:

Third Quarter Income Tax Estimate

The Department is reminding taxpayers that Iowa has not extended the due date for estimated income tax payments. The third quarter installment of tax year 2020 estimated income tax for taxpayers filing on a calendar year basis is due September 30, 2020.

The Government Working Group of the Governor’s Economic Recovery Advisory Board will meet from 10 a.m. to noon on Wednesday, September 9. The public is invited to attend.

The Government Working Group is led by Co-Chairs Emily Schmitt, General Counsel of Sukup Manufacturing Co., and Barbara Sloniker, Executive Vice President at the Siouxland Chamber of Commerce. Additionally, Kraig Paulsen, Director of the Iowa Department of Revenue, serves as Working Group Director.

On August 27, 2020 the Iowa Department of Revenue extended tax payment deadlines for certain businesses. The extension is a result of Order 2020-04, signed by Director of Revenue Kraig Paulsen, which provides flexibility for certain businesses disrupted by COVID-19.

The Government Working Group of the Governor’s Economic Recovery Advisory Board will meet from 8-10 a.m. on Wednesday, August 26. The public is invited to attend.

The Government Working Group is led by Co-Chairs Emily Schmitt, General Counsel of Sukup Manufacturing Co., and Barbara Sloniker, Executive Vice President at the Siouxland Chamber of Commerce. Additionally, Kraig Paulsen, Director of the Iowa Department of Revenue, serves as Working Group Director.