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Understanding Personal Income Tax in Iowa

Filed under State Taxes. Fact checked on February 12, 2013.

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This article discusses personal income tax in Iowa

If you are a resident or nonresident of Iowa and receive taxable income individually from property owned or business transacted in Iowa, you are subject to tax on net income. Therefore, if you are operating your business as an S corporation, partnership, limited liability company (LLC), or sole proprietorship, you will be subject to a personal income tax on your business income that passes through to you. In addition, school districts in Iowa are authorized to levy a local income tax, so be sure to check with your local government.

The following 2012 income tax rates are for all filing statuses and apply to all income:

Taxable Income Amount of Tax
$0 to $1,469 0.36% of taxable income
$1,469 to $2,938 $5.29, plus 0.72% of taxable income above $1,469
$2,938 to $5,876 $15.87, plus 2.43% of taxable income above $2,938
$5,876 to $13,221 $87.26, plus 4.5% of taxable income above $5,876
$13,221 to $22,035 $417.79, plus 6.12% of taxable income above $13,221
$22,035 to $29,380 $957.21, plus 6.48% of taxable income above $22,035
$29,380 to $44,070 $1,443.17, plus 6.8% of taxable income above $29,380
$44,070 to $66,105 $2,432.09, plus 7.92% of taxable income above $44,070
$66,105 and over $4,177.26, plus 8.98% of taxable income above $66,105

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