What's New?
LEGISLATIVE
UPDATE
The 2008
Legislative Summary is available online only.
Legislative changes are
incorporated in the information below.
Dependent
Child Health Care Coverage: A section has been
added to the IA 1040 and IA 1040A. On the paper form, the box is
located in the upper right corner of the first page. Taxpayers
who do not have health care coverage for their children may be
eligible for
the state medical assistance program or the hawk-i program. Those
who indicate they do not have health care coverage will receive information
about these programs.
Bonus Depreciation: Iowa
did not adopt the 50 percent “bonus depreciation” provisions of the
federal Economic Stimulus Act of 2008 passed by Congress in February
2008 for assets acquired during 2008. The adjustment for depreciation
should be made on form IA 4562A to account for the difference between
federal and Iowa depreciation.
Small Business
Expensing: Iowa
did adopt the provisions of the federal Economic Stimulus Act of
2008 relating to increasing the expensing amount under Section
179 of the Internal Revenue Code to $250,000 for the 2008 tax year.
LINE
CHANGES
Line
13 Social Security Worksheet
The
phase-out of tax on Social Security continues with a 32% reduction
established by the Iowa Legislature. For more information, see the 2006
Legislative Summary for SF 2408-C.
Line
24 Adjustments
- College
Savings Iowa or Iowa
Advisor 529 Plan:
The
deductible amount for tax year 2008 cannot exceed $2,685 per beneficiary.
- Vietnam Conflict
Bonus: This bonus is available for persons who served on active
duty in the United States armed forces from July 1, 1958, through
May 31, 1975.
Important: See
current Iowa Status on Educator Expenses and Tuition and Fees Deductions
Reminder - The following are available for 2008:
- Educator expenses
- Tuition and
fees deduction
Line 26 Reminder
- Filing thresholds for
taxpayers 65 and older
An
Iowa return is not required for single persons with income of $18,000
or less, and an Iowa return is not required for all other filers
with income of $24,000 or less. In the case of married persons, the
higher threshold amounts apply even if only one spouse is 65 years
or older as of December 31 of the tax year.
To
claim this benefit, taxpayers must check an informational box.
On the paper form, the box is located in the upper right corner
of the first page of the IA 1040.
Additional
information can be found in the 2006
Legislative Summary SF 2408-A.
Line 27 Federal income tax refund received in 2008
Do not include
the
federal rebate / economic stimulus check.
Line
33 FICA amount
FICA payments for
tax year 2008 in excess of $6,324 for Social Security tax for
each person can be deducted as a federal tax payment.
Line
37 Itemized Deductions
For itemized
deduction calculations dependent upon federal Adjusted Gross Income
(AGI), the federal AGI thresholds for tax year 2008 are $159,950
and $79,975.
Important:
See current Iowa Status
on State Sales Tax Deduction
The itemized deduction
for state sales and use tax paid is allowed on the 2008 federal and Iowa
Schedule A. The itemized deduction for state sales and use tax paid
is allowed on the Iowa Schedule A only if the taxpayer claimed an
itemized deduction for state sales and use tax paid on the federal
return.
Line 11 of the
Iowa Schedule A has the same deduction for qualified mortgage insurance
premiums as taken on the federal Schedule A.
School Tuition Organization Tax Credit Contributions: Do not include
as an itemized deduction any contributions for which a credit is claimed
on line 53 of the IA 1040.
Injured Veterans Grant Program Contributions: These contributions
do not qualify as itemized deductions.
Charitable Conservation Contribution Tax Credit: Do not include as
an itemized deduction any contributions for which a credit is claimed
on line 53 of the IA 1040.
Line
40 Charitable mileage
Iowa charitable mileage formula uses 39 cents.
Line
41 Standard Deduction for tax year 2008:
Filing Status
1: $1,750
Filing Status 3 & 4: $1,750
Filing Status 2, 5 or 6: $4,310
Line
43 Reminder
- Alternate
tax calculation for taxpayers 65 or older
Taxpayers
who are 65 years of age or older - except taxpayers filing Status
1 - who have income just above the threshold amount of $24,000
should complete the alternate tax calculation worksheet for taxpayers
65 or older. In the case of married persons, the alternate tax can
be applied even if only one spouse is 65 years or older as of December
31 of the tax year.
Additional
information can be found in the 2006
Legislative Summary SF 2408-B.
Line
53 Other Iowa Credits
Form IA 148
Tax Credits Schedule must be completed and attached.
Wind Energy
Production Tax Credit: Placed
in service on or after July 1, 2005, but before July 1, 2012. Valid
use includes on-site consumption.
Charitable
Conservation Contribution Tax Credit:
A tax credit for conveying real property as an unconditional charitable
donation in perpetuity to a qualified organization exclusively for conversation
purposes. The tax credit is for 50 percent of the fair market value of a
qualified real property interest located in Iowa, up to a maximum amount of
$100,000.
Line
58 Checkoffs
New: Child Abuse Prevention
Combined: Veterans Trust / Firefighters
Others:
- Fish and Wildlife Fund
- Iowa State Fair Foundation
Line
65 Reminder
- Iowa Earned
Income Credit
This credit is
7.0% of the federal Earned Income Credit. The Iowa EIC is
refundable.
Line
66 Other Refundable Credits
Form IA 148
Tax Credits Schedule must be completed and attached.
Soy-based Transformer
Tax Credits: Costs must be incurred after June 30, 2006,
and before January 1, 2009.
Line
74 Interest rate 2009
8% per year; 0.7%
per month; 0.021918% per day
OTHER
NEWS
Due
date: April 30, 2009
Farmers
and fishers due date: If at least 2/3 of income is from farming
or commercial fishing, penalty for underpayment of estimated
tax may be avoided in one of the following ways: (1) Pay the estimated
tax in one payment on or before January 15, 2009, and file the Iowa
income tax return by April 30, or (2) File the Iowa income tax return
and pay the tax due in full on or before March 2, 2009.
Military
Tax
Rate Schedules (pdf)
Payment
Options
- ePay (direct
debit) individual income tax estimated payments and final payment
of individual income tax through the Department's eFile & Pay system
free of charge.
- Credit
card
- Check/money
order: Send with 1040V (pdf)
payment voucher.
Power
of Attorney Form (pdf)
The federal power
of attorney form is accepted by the Iowa Department of Revenue. You
must write a statement on the federal form that indicates you are
submitting it for use with State of Iowa forms. The statement needs
to be initialed by the taxpayer.
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