A bill for an act excluding the net capital gain from the sale of certain livestock from the computation of net income for purposes of the individual income tax, and including retroactive applicability provisions.

This Iowa bill allows farmers and ranchers to exclude profits from selling certain livestock from their state income tax calculation. To qualify, the taxpayer must have earned more than half of their gross income from farming or ranching, and the animals must be held for a specific time: cattle or horses for at least 24 months and other breeding livestock for at least 12 months. The law also prevents individuals who are already retired farmers from claiming both this new exclusion and the existing exclusion for retired farmers in the same tax year. Finally, the changes apply retroactively to tax years beginning on or after January 1, 2023.