Budget & Taxes (Income Tax)

in committee · Iowa · House Feb 20, 2025

HF 496: A bill for an act modifying the individual and alternate income tax rates, and including applicability provisions.

This Iowa bill (HF 496) lowers the state's individual income tax rates for 2026 and beyond. It reduces the standard tax rate from 3.8% to 2.5% on taxable income, and lowers the alternate tax rate from 4.3% to 3.0% for higher-income filers. The changes apply to all Iowa residents and nonresidents with taxable income, affecting most individual income tax returns filed for tax years beginning January 1, 2026. The bill modifies existing tax calculation methods but does not change filing requirements or exemptions.

Topics ✓ Budget & TaxesSupports Budget & TaxesBill reduces individual income tax rates for all filers, providing direct tax relief and lowering state revenue, aligning with tax reduction support indicators.95% confidence

Sub-Topics Business Taxes Income Tax

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in committee · Iowa · House Feb 24, 2025

HF 566: A bill for an act modifying individual income tax rates and providing tax credits for certain married persons filing a joint return, and including effective date and retroactive applicability provisions.

HF 566 modifies Iowa's individual income tax rates for married couples filing jointly. It sets the tax rate to 0% for couples with five or more dependents under 18 or for first/second-time joint filers, and creates a $1,000 per dependent tax credit (up to 10 dependents under 18) for these couples. Any excess credit is refundable or can be applied to future tax bills. The bill takes effect immediately upon enactment and applies retroactively to tax years beginning January 1, 2025.

Topics ✓ Budget & TaxesSupports Budget & TaxesProvides tax relief via 0% rate and $1,000 per dependent credit for qualifying families, reducing tax burden on middle/lower income.95% confidence

Sub-Topics Income Tax Tax Credits

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in committee · Iowa · House Feb 24, 2025

HF 568: A bill for an act excluding interest income earned from banks and credit unions from the calculations of Iowa net income for purposes of the individual income tax, and including effective date and retroactive applicability provisions.

HF 568 removes interest income earned from banks and credit unions from Iowa's calculation of individual income tax. This directly affects Iowa taxpayers who earn interest on savings accounts, certificates of deposit, or similar deposits at qualifying financial institutions. The bill defines "bank" broadly (including credit unions and savings associations) and specifies that the change applies retroactively to tax years beginning on or after January 1, 2025. It does not change other tax rules but reduces taxable income for affected individuals starting in 2025.

Topics ✓ Budget & TaxesSupports Budget & TaxesBill provides tax relief by excluding interest income from taxable income for Iowa taxpayers, reducing individual tax burden on savings/CD interest.95% confidence

Sub-Topics Income Tax

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in committee · Iowa · Senate Mar 3, 2025

SF 402: A bill for an act relating to the deduction of nursing facility expenses for purposes of the individual income tax, and including retroactive applicability provisions.

This bill allows Iowa individual income taxpayers to deduct expenses paid to licensed nursing facilities (under Chapter 135C) for health-related care and services, provided those costs weren't already deducted for federal tax purposes. It directly affects Iowans paying for nursing care who file state income tax returns. The deduction applies to expenses incurred for health services, not general living costs at the facility. The law includes retroactive application, making it effective for tax years beginning on or after January 1, 2025.

Topics ✓ Budget & TaxesSupports Budget & TaxesAllows tax deduction for nursing care expenses, reducing state tax burden for eligible residents, aligning with tax relief for middle-income households.90% confidence ✓ HealthcareSupports HealthcareBill allows tax deduction for nursing facility health expenses, reducing out-of-pocket costs for Iowans and improving access to healthcare services.85% confidence

Sub-Topics Income Tax Long-Term Care

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in committee · Iowa · Senate Mar 11, 2025

SSB 1152: A bill for an act relating to state income tax withholdings on winnings from sports wagering, and including effective date provisions.

This bill requires Iowa to withhold state income tax on sports wagering winnings when federal income tax would also be withheld from those winnings. It treats all sports betting winnings as taxable Iowa earned income, aligning state withholding with federal tax rules for such winnings. The law applies to individuals who win amounts triggering federal tax withholding (typically $600 or more for most gambling, but specifically tied to federal requirements for sports betting). The bill takes effect on January 1, 2026, directly affecting Iowa residents who win significant amounts through licensed sports betting.

Topics ✓ Budget & TaxesSupports Budget & TaxesBill mandates state tax withholding on sports wagering winnings per federal rules, generating new revenue for state budget without tax relief or spending cuts.95% confidence

Sub-Topics Income Tax

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died · Iowa · House Mar 19, 2025

HF 794: A bill for an act relating to state income tax withholdings on winnings from sports wagering, and including effective date provisions.

HF 794 requires Iowa to withhold state income tax from sports wagering winnings whenever federal income tax is withheld on those winnings. This applies to individuals who win amounts triggering federal tax withholding, such as winnings over $600 from gambling under federal rules. The law will take effect on January 1, 2026.

Topics ✓ Budget & TaxesSupports Budget & TaxesRequires state tax withholding on sports wagering winnings where federal tax applies, increasing tax revenue collection and aligning with fiscal management practices.95% confidence

Sub-Topics Income Tax

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in committee · Iowa · House Mar 26, 2025

HF 567: A bill for an act excluding the net capital gain from the sale of gold or silver from the calculations of Iowa net income for purposes of the individual income tax, and including effective date and retroactive applicability provisions.

HF 567 excludes net capital gains from selling gold or silver from Iowa's individual income tax calculations. It directly affects Iowa taxpayers who sell gold or silver coins, bars, ingots, or pure gold/silver, allowing them to subtract these gains when computing taxable income. The bill defines "gold or silver" broadly to include common forms like coins and bars, and applies retroactively to tax years starting January 1, 2025. This change modifies how certain investment gains are taxed but does not alter the tax rate applied to other income.

Topics ✗ Budget & TaxesOpposes Budget & TaxesExcludes capital gains from gold/silver sales from taxable income, reducing state tax revenue. Creates targeted tax break for asset investors, weakening fiscal revenue collection.85% confidence

Sub-Topics Income Tax

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in committee · Iowa · House Apr 3, 2025

HF 30: A bill for an act providing a deduction from the individual and corporate income taxes for the amount of certain income derived from indigent representation by an eligible law firm, and including retroactive applicability provisions.

HF 30 creates a tax deduction for Iowa law firms representing indigent clients in specific court-appointed cases. It directly affects eligible law firms with two or more attorneys (who practice at least half the year) and attorneys licensed for fewer than 10 years, for cases appointed on or after July 1, 2025. The deduction equals the difference between $150 per hour (or the firm's actual rate) and the state's standard hourly rate ($76-$86) for such cases, calculated based on the firm's pro rata share. The deduction applies retroactively to tax years beginning January 1, 2025.

Topics ✓ Budget & TaxesSupports Budget & TaxesBill provides tax deduction for law firms representing indigent clients, offering tax relief to support indigent defense services.90% confidence ✓ Criminal JusticeSupports Criminal JusticeBill funds indigent defense through tax deductions, directly supporting access to counsel in criminal cases - a core criminal justice reform objective.95% confidence

Sub-Topics Business Taxes Income Tax

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in committee · Iowa · House Apr 17, 2025

HF 110: A bill for an act excluding overtime pay from the individual income tax, and including applicability provisions.

HF 110 proposes to exclude overtime pay from the individual income tax in Iowa. This bill directly affects individuals who earn overtime compensation. It allows taxpayers to subtract the portion of their compensation earned at one and a half times their regular rate from their taxable income. These provisions would apply to tax years beginning on or after January 1, 2026.

Topics ✓ Budget & TaxesSupports Budget & TaxesExcludes overtime pay from taxable income, providing direct tax relief for workers earning overtime compensation.95% confidence ✓ Labor & EmploymentSupports Labor & EmploymentExcludes overtime pay from income tax, increasing take-home pay for workers earning overtime compensation.95% confidence

Sub-Topics Income Tax Labor Standards

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passed · Iowa · House Apr 28, 2025

HF 988: A bill for an act creating a catastrophic savings account and modifying individual income taxes for account holders and including applicability provisions.

HF 988 establishes catastrophic savings accounts for Iowa residents who own homes, effective January 1, 2026. This bill allows account holders to deduct contributions to these accounts from their state income tax, with lifetime limits tied to their homeowner's insurance premiums or the home's assessed value for self-insured individuals. Interest earned on these accounts is also tax-deductible. Funds can be withdrawn tax-free to pay deductibles for homeowner's insurance related to defined catastrophic events like floods or windstorms. However, withdrawals for non-qualified expenses are subject to state income tax and a 2.5% penalty.

Topics ✓ Budget & TaxesSupports Budget & TaxesEstablishes tax deductions for homeowner savings account contributions and interest, providing direct tax relief to residents under income tax provisions.95% confidence

Sub-Topics Income Tax Property Tax

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