The state of Iowa has made the following tax law changes for tax year 2020:
- Beginning on after January 1, 2020 for tax year 2020, Iowa will automatically conform to changes made to the IRC, except as stated by Iowa law.
- Economic Impact Payments (EIP) if a rebate or a refundable tax credit won't be added to your Iowa taxable income even as part of your federal refund.
- Paycheck Protection Program (PPP) loans forgiven and excluded from income for federal purposes will also be allowed to be excluded from Iowa income.
- IRS Notice 2020-32 does not allow some deductions for business expenses using PPP loans and Iowa conforms to this exclusion.
- Iowa does not conform to special depreciation allowance for assets acquired in 2020. See instructions for additional information.
- Geothermal heat pump tax credit may be available for installations completed in 2020. It cannot exceed $1,000,000 per year. Application deadline for 2020 installations due May 1, 2021.
- Report the amount of federal, state, or local grants given to communication service providers, if included on Schedule C line 1, if the grant was used to install broadband infrastructure services in certain service areas at or above the download and upload speeds.
- New Form- If amending your IA 1040 you must now attach the IA 102.
Iowa has not conformed to many of the federal tax law adjustments under the Tax Cuts and Jobs Act to view a full list of these non-conformities click here.