Tax Guidance

The guidance available here explains the general guides rather than detailed discussions of Iowa tax law. We make every attempt to keep guidance current, however, changes in law or policy may not be immediately reflected.

If you have tax questions, search our Frequently Asked Questions.

Tax Guidance

Tax Type:
Income Tax, Iowa Tax Reform

Iowa’s conformity with the federal limitations on business interest expense deductions imposed by Internal Revenue Code (IRC) section 163(j) varies depending on the year. For tax years beginning on or after Jan 1, 2019, and before January 1, 2020, Iowa conformed with the federal limitation. At this time Iowa does not conform to the federal limitation for tax years beginning on or after January 1, 2020. Due to these differences in conformity, some taxpayers will need to make certain adjustments to their federal business interest expense deduction to calculate the correct Iowa deduction amount for a given year.

Last updated:
Tax Type:
Income Tax, Iowa Tax Reform

This guidance was updated on 05/03/2021 to describe required adjustments and reporting procedures in tax years beginning on or after January 1, 2019 and before January 1, 2020, for partnerships and their partners that had business interest expense that was disallowed as a deduction for federal purposes under section 163(j) of the Internal Revenue Code in tax year 2018, but that was allowed as a deduction for Iowa purposes in tax year 2018 because of nonconformity. See Business Interest Expense Deduction for more information about adjustments to the business interest expense deduction required for tax years beginning on or after January 1, 2020.

Last updated:
Tax Type:
Sales & Use Tax

This guidance provides an overall summary of information including details specific if you are an Employee, Independent Contractor (Self Employed), or Employer. Additionally there are details regarding returns/schedules to be filed, reporting income from tips, what is subject to sales tax, Local Option Sales Tax, and Consumer's Use Tax.

Last updated:
Tax Type:
Income Tax, Coronavirus/COVID-19

On March 27, 2020, President Donald Trump signed Public Law 116-136, the Coronavirus Aid, Relief, and Economic Security (CARES) Act of 2020. The CARES Act includes a number of federal tax changes, and several are retroactive to tax years 2018 and 2019. Iowa has not conformed with any of these federal tax changes to the extent they apply to a tax year beginning prior to January 1, 2020. Iowa generally conforms with these federal tax changes to the extent they affect Iowa income taxes for tax years beginning on or after January 1, 2020. This guidance focuses primarily on Iowa’s nonconformity with this federal law for tax years 2018 or 2019, but it also includes explanations of certain other provisions and their impact on Iowa income taxes for tax years beginning on or after January 1, 2020 that may be of interest to taxpayers.

Last updated:
Tax Type:
Income Tax

On June 29, 2020 Governor Reynolds signed into law House File 2641. Division V of that bill modified the procedures and requirements for reporting federal income tax changes made after July 1, 2020, to the Iowa Department of Revenue. This guidance is intended to provide a general overview of these procedures and requirements.

Last updated:
Tax Type:
Sales & Use Tax

This guidance is intended as a general guide and is often considered a primary resource for contractors taxability. For additional details reference Iowa Administrative Rules Chapter 701-219.

Last updated:
Tax Type:
Sales & Use Tax

A general guide but not an all-inclusive discussion of Iowa sales and use tax law. Generally considered the primary guidance resource for sales & use tax.

See Iowa Tax Issues for Nonprofit Entities for nonprofit entities that qualify for exemption.

Last updated:
Tax Type:
General, Income Tax, Tax Credits, Coronavirus/COVID-19

The Department has issued new guidance related to Iowa’s conformity with certain tax provisions of the federal Consolidated Appropriations Act, 2021. This guidance focuses primarily on Iowa’s nonconformity with this federal law for tax years beginning prior to January 1, 2020. Iowa generally conforms with the federal tax changes to the extent they affect Iowa income taxes for tax years beginning on or after January 1, 2020.

Last updated:
Tax Type:
Coronavirus/COVID-19

On March 19, 2020, the Director of the Department of Revenue issued Order 2020-01 granting certain filing and payment extensions pursuant to Iowa Code section 421.17(30) following the Governor’s Proclamation of Disaster Emergency in response to the recent outbreak of the COVID-19 virus. Click to view News Releases, Iowa Small Business Relief Program, tax information, and Common Questions.

Last updated:
Tax Type:
Income Tax, Coronavirus/COVID-19

On June 29, 2020 Governor Reynolds signed into law House File 2641. House File 2641 in part exempts from the Iowa income and franchise tax the receipt of financial assistance grants provided by the Iowa Economic Development Authority under the Iowa Small Business Relief Grant Program. The Department has published updated guidance which describes this tax exemption, identifies qualifying grants, and directs taxpayers on how to claim this exemption on Iowa tax returns. 

Last updated: