Iowa Income Tax Calculator 2026

Iowa’s single 3.8% rate explained

Iowa taxes all taxable income at 3.8% in 2026. Taxable income is federal AGI after Iowa adjustments, minus the same standard deduction you take federally (or itemized deductions). Iowa then subtracts exemption credits of $40 per taxpayer and $40 per dependent from the tax, and adds any school district surtax.

Because Iowa now follows the federal standard deduction and has one rate, most Iowans can estimate their state tax from their federal return in a few lines. Iowa also follows the federal deduction of up to $6,000 for taxpayers 65 and older.

Worked example: married couple in Cedar Rapids

A married couple with two children and $95,000 of wages subtracts the $32,200 standard deduction, leaving $62,800 of taxable income. Tax at 3.8% is $2,386. Four $40 exemption credits reduce that to $2,226.

Living in the Cedar Rapids school district adds a 5% surtax on that tax, or $111, for a total Iowa bill of $2,338. The same family in Des Moines, where the surtax is 0%, would pay $2,226.

Retirement income and Social Security in Iowa

Since tax year 2023, Iowa excludes retirement income for anyone 55 or older on December 31, anyone who is disabled, and qualifying surviving spouses. The exclusion covers pensions, annuities, IRAs, 401(k)-type employer plans and deferred compensation.

The age test is applied on December 31 of the tax year, so someone who turns 55 in December qualifies for that whole year. For married couples, the exclusion applies only to the spouse who meets one of the tests. In practice, a 50-year-old taking IRA withdrawals still owes Iowa tax on them, while a 56-year-old retiree generally does not.

When and how to file the IA 1040

Iowa returns are due April 30, not April 15, so the 2026 IA 1040 is due April 30, 2027 (or the next business day). Iowa has no paper extension form: you automatically get extra time to file if you have paid at least 90% of the correct tax by the original due date.

If you file late and have not paid 90% of the tax by the due date, Iowa adds a 10% penalty to the tax due. If you file on time but cannot pay in full, the penalty on the unpaid amount is 5%. Interest also accrues.

Part-year residents and nonresidents with Iowa-source income file the same IA 1040 and calculate a credit for the share of income not taxable by Iowa. Illinois residents with only Iowa wages generally need not file because of reciprocity.