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14. OTHER INCOME.
Enter taxable income not reported on lines 1-13. Attach an explanation of the type of income. Examples of income to be reported on line 14 include:
a. Baby-sitting income not reported on Federal Schedule C or C-EZ.
b. Bonus Depreciation adjustment from the IA 4562A; attach the IA 4562A to your return. See the information below and our general information file.
c. Capital gains from installment sales in 2004: Accrual-method taxpayers may now use the installment method for reporting capital gains on their Iowa returns.
d. Director’s fees
e. Drilling: Intangible drilling costs that were reported on Federal form 6251 less any amounts amortized in the tax year.
f. Executor’s fees
g. Gambling winnings: You must report the full amount of gambling winnings. Report any tax withheld on line 61 of the IA1040. Gambling losses may be reported as an itemized deduction on Schedule A, but you cannot deduct more than the winnings you report.
h. Iowa Educational Savings Plan Trust: Income received from the cancellation of a participation agreement to the extent the amount was previously deducted on line 24 of the IA 1040.
i. Partnership income and/or S Corporation income: Modifications that increased the income.
j. Refundable Iowa Credits received in 2004 which were included as income on the federal 1040 must be added back. This includes Cow-Calf refunds received in 2004 (unless reported on Federal Schedule F).
k. Refunds: State income tax refunds other than Iowa to the extent that the tax refunded in 2004 was deducted on a prior Iowa return.
l. Wells: Percentage depletion from an oil, gas or geothermal well that was reported on Federal form 6251.
m. Other income as reported on line 21 of the Federal 1040.
Distribution from a Coverdell education savings account is reported on line 14 to the extent of the taxable amount reported on line 21 of the Federal 1040.
MARRIED SEPARATE FILERS: The spouse to whom the income was paid must report that income. Modifications to partnership and/or S Corporation income are allocated between spouses in the same manner as that income was divided on line 10, IA1040.
Please Note: Iowa did NOT couple with the following provisions of the Federal Job Creation and Worker Assistance Act:
a. Bonus Depreciation
Iowa did not adopt the “bonus depreciation” provisions for assets placed in service on or after September 11, 2001, and before May 6, 2003. An adjustment will have to be made on form IA 4562A to account for the difference between the Federal depreciation and the Iowa depreciation. The total adjustment for decoupling as calculated on line 5 of Part III of the IA 4562A should be entered on line 14 of the IA 1040 as other income. This amount may need to be added back on several lines or schedules. Attach the IA 4562A to your income tax return.
When figuring your gross income on the IA 1040, you will enter the same figures as on the equivalent lines from the Federal 1040. However, the bonus deprecation adjustment will then be entered on line 14 of the IA 1040 to reflect the effect of decoupling on this issue. Lines 5, 6, 7, 10, and 11 of the IA 1040, which may be impacted by the bonus depreciation issue, will still be the same as the equivalent Federal 1040 entries.
Finally, the bonus depreciation adjustment on line 14 of the IA 1040 may need to be added back on several other schedules or line entries.
b. Net Operating Losses
Iowa did not adopt the provisions for the 5-year carryback for net operating losses incurred in 2001 and 2002. Therefore, Iowa net operating losses will still be carried back two years, except for losses incurred in presidentially declared disaster areas (3-year carryback) and losses incurred by farm corporations (5-year carryback).
Please Note: Iowa DID couple with the Federal bonus depreciation and Section 179 Expensing Provision of JGTRRA
In a special session held in September 2004, the Iowa Legislature passed legislation to couple with the additional 50% first-year depreciation allowance (bonus depreciation) for assets placed in service after May 5, 2003, but before January 1, 2005. In addition, this law also coupled with the increase in Section 179 expensing allowance from $25,000 to $100,000 for tax years beginning on or after January 1, 2003 ($102,000 for 2004). These provisions were provided in the federal Jobs and Growth Tax Relief Reconciliation Act of 2003.