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51. BALANCE.

Subtract the amount on line 50 from the amount on line 46. If less than zero, enter zero.

TAX REDUCING INCOME TO LESS THAN $9,000
FOR TAXPAYERS USING FILING STATUS 1, SINGLE:

Taxpayers using filing status 1 are not eligible to use the alternate tax computation. However, a single taxpayer who is not claimed as a dependent on another person’s Iowa return cannot have a tax figure on line 51 of the IA1040 that would reduce the combination of net income from line 26 and pension exclusion from line 21 of the IA1040 to less than $9,000. If subtracting line 51 from the total of lines 21 and 26 results in a difference of less than $9,000, the entry on line 51 must be reduced as calculated on the worksheet below.

TAX REDUCTION WORKSHEET

1. Enter the total of the net income from line 26 and pension exclusion from line 21 of the IA1040.
1.
2. Subtract $9,000 from line 1. Enter the difference on line 3.
2.
- 9,000
3. Result:
3.
4. Enter the tax from line 51, IA1040.
4.
5. Compare line 3 and line 4. Enter the smaller number here. If this number is different than the one on line 51, IA1040, substitute this number. Write “tax reduction” to the left of line 51.
5.

EXAMPLE

John has an Iowa net income of $9,050.
None of this income includes pension.
Tax from line 51 is $120.

1. Enter the total of the net income from line 26 and pension exclusion from line 21 of the IA1040.
1.
9,050
2. Subtract $9,000 from line 1. Enter the difference on line 3.
2.
- 9,000
3. Result:
3.
50
4. Enter the tax from line 51, IA1040.
4.
120
5. Compare line 3 and line 4. Enter the smaller number here. If this number is different than the one on line 51, IA1040, substitute this number. Write “tax reduction” to the left of line 51.
5.
50

The Tax Reduction Worksheet is available as a fillable pdf.

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