44. IOWA LUMP-SUM TAX.
A lump-sum distribution occurs when, in one tax year, you receive the total balance from the pension or profit-sharing plan of an employer due to termination of employment, termination of the plan, or death of the employee.
Iowa lump-sum tax applies only if IRS form 4972 was used to compute the federal tax on any portion of the lump-sum distribution. If there is no federal lump-sum tax, then there is no Iowa lump-sum tax.
IOWA RESIDENTS: Enter 25% of the federal tax from IRS form 4972 on line 44 of the IA 1040. Attach federal form 4972.
PART-YEAR RESIDENTS: If a lump-sum distribution reported on federal form 4972 was received while an Iowa resident, 25% of the federal tax from form 4972 must be entered on line 44. Part-year residents who receive a lump-sum distribution while not an Iowa resident are not subject to Iowa lump-sum tax on that distribution. A copy of the federal form 4972 must be attached.
NONRESIDENTS: Nonresidents receiving lump-sum distributions are not subject to Iowa lump-sum tax.
Filers (including status 4): Lump-sum tax is reported by
the spouse who received the distribution.
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