reglab/statecodes huggingface dataset:
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 43 - Assessments and Refunds › Rule 701-43.2 - Notice of Assessment, Supplemental Assessments and Refund Adjustments

Current through Register Vol. 47, No. 3, July 24, 2024
If after following the procedure outlined in 43.1(2) no
				  agreement is reached, and the taxpayer does not pay the amount determined to be
				  correct, a notice of assessment shall be sent to the taxpayer by mail. If the
				  period in which the correct amount of tax can be determined is nearly at an
				  end, either a notice of assessment without compliance with 43.1(2) or a
				  jeopardy assessment may be issued. All notices of assessment shall bear the
				  signature of the director
The department may, at any time within the period prescribed
				  for assessment or refund adjustment, make a supplemental assessment or refund
				  adjustment whenever it is ascertained that any assessment or refund adjustment
				  is imperfect or incomplete in any respect.
If an assessment or refund adjustment is appealed (protested
				  under rule
				  701-78. (17A)) and is
				  resolved whether by informal proceedings or by adjudication, the department and
				  the taxpayer are precluded from making a supplemental assessment or refund
				  adjustment concerning the same issue involved in the appeal for the same tax
				  period unless there is a showing of mathematical or clerical error or a showing
				  of fraud or misrepresentation. Nothing in this rule shall prevent the making of
				  an assessment or refund adjustment for the purpose of taking into account the
				  impact upon Iowa net income of federal audit adjustments.
This rule is intended to implement Iowa Code sections
				  42225.
				  and
				  42230..
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 43 - Assessments and Refunds › Rule 701-43.4 - Optional Designations of Funds by Taxpayer

Current through Register Vol. 47, No. 3, July 24, 2024
(1)
Iowa fish and game protection
				fund.
a. A taxpayer filing an
				individual income tax return may designate a checkoff of $1 or more to be
				donated to the Iowa fish and game protection fund. If the overpayment shown on
				the return or the payment remitted with the return is insufficient to pay the
				amount designated to the Iowa fish and game protection fund, the amount
				credited to the fund will be reduced accordingly. The designation to the fund
				is irrevocable and cannot be made on an amended return.
Example A: Overpayment as shown on the return is $50. $25 is
				  designated to the fund. Due to an error on the return, only $20 is an
				  overpayment. The taxpayer would not receive any refund, and all $20 of the
				  overpayment would be credited to the fund.
Example B: Overpayment as shown on the return is $50. $25 is
				  designated to the fund. Due to an error on the return, no overpayment occurred,
				  but instead the taxpayer owes $20. No money would be credited to the
				  fund.
Example C: Amount shown due on the return is $30. $20 is
				  designated to the fund. A $50 payment was made with the return. Due to an error
				  on the return, the taxpayer owes $40. Only $10 would be credited to the
				  fund.
b. A designation to
				the Iowa fish and game protection fund may be allowed only after the taxpayer's
				obligations to the department of revenue, the child support recovery unit of
				the department of human services, the foster care recovery unit of the
				department of human services, the college student aid commission, the office of
				investigations of the department of human services, the district courts, and
				other state agencies are satisfied.
c. On or before January 31 of the year
				following each year in which returns with the Iowa fish and game protection
				fund checkoff are due, the department of revenue shall certify the amount
				designated to the Iowa fish and game protection fund and report this amount to
				the state treasurer.
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 43 - Assessments and Refunds › Rule 701-43.5 - Abatement of Tax

Current through Register Vol. 47, No. 3, July 24, 2024
For notices of assessment issued on or after January 1,
				  1995, if the statutory period for appeal has expired, the director may abate
				  any portion of unpaid tax, penalties or interest which the director determines
				  to be erroneous, illegal, or excessive. See rule
				  701-731.
				  (421) for procedures on requesting abatement of tax.
This rule is intended to implement Iowa Code section
				  42160..
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 44 - Penalty and Interest › Rule 701-44.1 - Penalty

Current through Register Vol. 47, No. 3, July 24, 2024
See rule
				  701-106. (421) for
				  penalty for tax periods beginning on or after January 1, 1991. See rule
				  701-108. (421)
				  for statutory exemptions to penalty for tax periods beginning on or after
				  January 1, 1991.
This rule is intended to implement Iowa Code sections
				  42127. and
				  42225..
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 44 - Penalty and Interest › Rule 701-44.2 - Computation of Interest on Unpaid Tax

Current through Register Vol. 47, No. 3, July 24, 2024
Interest shall accrue on tax due from the original due date
				  of the return. Interest on refunds of any portion of the tax imposed by statute
				  which has been erroneously refunded and which is recoverable by the department
				  shall bear interest as provided by law from the date of payment of the refund,
				  with each fraction of a month considered to be an entire month. See rule
				  701-102. (421) for the
				  statutory interest rate.
All payments shall be first applied to the penalty and then
				  to the interest, and the balance, if any, to the amount of tax due.
This rule is intended to implement Iowa Code sections
				  4217. and
				  42225..
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 44 - Penalty and Interest › Rule 701-44.3 - Computation of Interest on Refunds Resulting From Net Operating Losses

Current through Register Vol. 47, No. 3, July 24, 2024
If the amount of tax is reduced as a result of a net
				  operating loss or net capital loss, interest shall accrue on the refund
				  resulting from the loss carryback beginning on the date a claim for refund or
				  amended return carrying back the net operating loss or net capital loss is
				  filed with the department or on the first day of the second calendar month
				  following the date of the actual payment, whichever is later.
This rule is intended to implement Iowa Code section
				  42225..
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 44 - Penalty and Interest › Rule 701-44.4 - Computation of Interest on Overpayments

Current through Register Vol. 47, No. 3, July 24, 2024
If the amount of tax determined to be due by the department
				  is less than the amount paid, the excess to be refunded will accrue interest
				  from the first day of the second calendar month following the date of payment
				  or the date the return was due to be filed or was filed, whichever is the
				  later.
This rule is intended to implement Iowa Code section
				  42225..
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 45 - Partnerships › Rule 701-45.1 - General Rule

Current through Register Vol. 47, No. 3, July 24, 2024
An Iowa partnership, limited partnership, or limited
				  liability company required to file a return under the provisions of Iowa Code
				  subsection
				  42215(2).
				  shall be a partnership, limited partnership, or limited liability company
				  required to file a partnership return for purposes of federal income tax. A
				  partnership or limited liability company engaged in carrying on business in
				  this state is an Iowa partnership or an Iowa limited liability company. Iowa
				  follows the Treasury check-the-box regulation, 3 01.7701-3, for determination
				  of the tax status of partnerships or limited liability companies including
				  single-member limited liability companies.
This rule is intended to implement Iowa Code section
				  42215..
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 45 - Partnerships › Rule 701-45.2 - Partnership Returns

Current through Register Vol. 47, No. 3, July 24, 2024
Every partnership deriving income (1) from property owned
				  within this state or (2) from a business, trade, profession or occupation
				  carried on within the state must make a return of income regardless of the
				  amount of income or loss and regardless of the residence of the partners. The
				  return shall be made on the proper form and signed by one of the partners. The
				  return shall be made on the same period basis, calendar or fiscal, as the
				  partnership accounts are kept, irrespective of the fact the partners are
				  reporting their incomes on a different period basis. The return shall be filed
				  with the department on or before the last day of the fourth month after the
				  expiration of the tax year
This rule is intended to implement Iowa Code section
				  42221..
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 45 - Partnerships › Rule 701-45.3 - Contents of Partnership Return

Current through Register Vol. 47, No. 3, July 24, 2024
The return of a resident partnership or of a partnership with
				  one or more nonresident members, but whose income is derived entirely or
				  partially from sources within this state, shall state specifically (1) the net
				  income, and the capital gains or losses reported on the federal partnership
				  return, (2) the names and addresses of the partners, and (3) their respective
				  shares in said amounts.
This rule is intended to implement Iowa Code section
				  42215..
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 45 - Partnerships › Rule 701-45.4 - Distribution and Taxation of Partnership Income

Current through Register Vol. 47, No. 3, July 24, 2024
A partnership as such is not taxable but the members of a
				  partnership (including limited partnerships organized under Iowa Code chapter
				  488) are taxable (except as otherwise provided in 701-subrule 40.16(5)
				  respecting nonresident members) upon their distributable shares of the net
				  income of the partnership whether distributed to the partners or not. If the
				  result of the partnership operation is a net loss (i.e., excess of allowable
				  deductions from gross income) the loss may be deducted by the partners (except
				  as otherwise provided respecting nonresident members) in the same proportion
				  that net income would have been taxable to the partners. If the partner reports
				  income on the same taxable year basis as that of the partnership, the
				  distributable share of the net income (or loss) of the partnership for the
				  taxable year must be included in or deducted from gross income on the
				  individual return for that year If, however, the taxable year of the partner is
				  different from that of the partnership, distributable shares must be included
				  in or the proportion of the loss deducted from gross income for the year in
				  which the taxable year of the partnership ends.
Residents of Iowa must report in total their distributable
				  share of partnership income or loss on their Iowa income tax return.
				  Nonresidents must report, for income tax purposes, their share of distributable
				  partnership income or loss as determined under 701-subrule 40.16(6).
This rule is intended to implement Iowa Code sections
				  4227.
				  and
				  42215..
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 46 - Withholding › Rule 701-46.4 - Withholding on Nonresidents

Current through Register Vol. 47, No. 3, July 24, 2024
(1)
General rules.
Payers of Iowa income to nonresidents are
				required to withhold Iowa income tax and to remit the tax to the department on
				all payments of Iowa income to nonresidents except payments of wages to
				nonresidents engaged in film production or television production described in
				subrule 46.4(5); income payments for agricultural commodities or products
				described in subrule 46.4(6); deferred compensation payments, pension, and
				annuity payments attributable to personal services in Iowa by nonresidents
				described in subrule 46.4(7); and partnership distributions from certain
				publicly traded partnerships described in subrule 46.4(8). Withholding agents
				should use the following methods and rates in withholding for nonresidents:
a.
Wages or salaries.
Use
				the same withholding procedures, tables, formulas, and rates as are used for
				residents. See rule
				701-462.
				(422). Subrule 46.4(5) is an exception to the general rule. In addition, in
				accordance with the reciprocal tax agreement between Iowa and Illinois
				described in 701-subrule 38.13(1), Iowa withholding tax is not withheld on
				wages of Illinois residents who perform personal services in Iowa.
b.
Payments other than wages,
				salaries, and other compensation for personal services.
In lieu of
				using withholding tables or computer formulas to determine the amount of Iowa
				income tax to be withheld from payments made to nonresidents other than for
				salaries, wages, or other compensation for personal services, or income
				payments to nonresidents for agricultural commodities or products, Iowa income
				tax should be withheld at a rate of 5 percent of the amount of the payment.
				Subrule 46.4(6) describes the optional exemption from withholding of income
				payments made to nonresidents for the sale of agricultural commodities or
				products.
Nonresidents who prefer to make Iowa estimate payments
				  instead of having Iowa income tax withheld from income payments from Iowa
				  sources should refer to subrule 46.4(3) and rule
				  701-93.
				  (422).
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 46 - Withholding › Rule 701-46.5 - Penalty and Interest

Current through Register Vol. 47, No. 3, July 24, 2024
(1)
Penalty.
See rule
				701-106. (421) for
				penalty for tax periods beginning on or after January 1, 1991. See rule
				701-108. (421)
				for statutory exemptions to penalty for tax periods beginning on or after
				January 1, 1991.
(2)
computation of interest on unpaid tax.
Interest shall accrue
				on tax due from the original due date of the return. Interest on refunds of any
				portion of the tax imposed by statute which has been erroneously refunded and
				which is recoverable by the department shall bear interest as provided by law
				from the date of payment of the refund, with each fraction of a month
				considered to be an entire month. See rule
				701-102. (421) for the
				statutory interest rate.
All payments shall be first applied to the penalty and then
				  to the interest, and the balance, if any, to the amount of tax due.
(3)
computation of
				interest on overpayments.
If the amount of tax determined to be due by
				the department is less than the amount paid, the excess to be refunded will
				accrue interest from the first day of the second calendar month following the
				date of payment or the date the return was due to be filed or was filed,
				whichever is the later.
This rule is intended to implement Iowa Code sections 421.27,
				  422.16 and 422.25.
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 46 - Withholding › Rule 701-46.6 - Withholding Tax Credit to Workforce Development Fund

Current through Register Vol. 47, No. 3, July 24, 2024
Upon payment in full of a certificate of participation or
				  other obligation issued to fund a job training program under Iowa Code chapter
				  260E, the community college which provided the training is to notify the
				  economic development authority of the amount paid by the employer or business
				  to the community college during the previous 12 months. The economic
				  development authority is to notify the department of revenue of this amount.
				  The department is to credit 25 percent of this amount to the workforce
				  development fund in each quarter for the next ten years from the withholding
				  tax paid by the employer or business. If the withholding tax paid by the
				  employer or business for a quarter is not sufficient to cover the sum to be
				  credited to the workforce development fund, the sum to be credited is to be
				  reduced accordingly. The aggregate amount from all employers to be transferred
				  to the workforce development fund in a year is not to exceed $4 million for
				  fiscal years beginning on or after July 1,2001, but before July 1,2014. The
				  aggregate amount is not to exceed $5,750,000 for the fiscal year beginning July
				  1, 2014, and the aggregate amount is not to exceed $6,000,000 for fiscal years
				  beginning on or after July 1, 2015.
This rule is intended to implement Iowa Code section
				  42216A.
				  as amended by 2014 Iowa Acts, House File 2460.
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 46 - Withholding › Rule 701-46.7 - Ace Training Program Credits From Withholding

Current through Register Vol. 47, No. 3, July 24, 2024
The accelerated career education (ACE) program is a training
				  program administered by the Iowa department of economic development to provide
				  technical training in state community colleges for employees in highly skilled
				  jobs in the state to the extent that the training is authorized in an agreement
				  between an employer or group of employers and a community college for the
				  training of certain employees of the employer or group of employers. If a
				  community college and an employer or group of employers enter into a program
				  agreement for ACE training, a copy of the agreement is to be sent to the
				  department of revenue. No costs incurred prior to the date of the signing
				  between a community college and an employer or group of employers may be
				  reimbursed or are eligible for program job credits, including job credits from
				  withholding unless the costs are incurred on or after July I, 2000.
(1) The costs of the ACE training program may
				be paid from the following sources:
a.
				Program job credits which the employer receives on the basis of the number of
				program job positions agreed to by the employer for the training
				program;
b. Cash or in-kind
				contributions by the employer toward the costs of the program which must be at
				least 20 percent of the total cost of the program;
c. Tuition, student fees, or special charges
				fixed by the board of directors of the community college to defray costs of the
				program;
d. Guarantee by the
				employer of payments to be received under paragraphs
"a "
and
"b "
of this subrule.
This rule pertains only to the program job credits from
				  withholding described in paragraph
"a. "
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 46 - Withholding › Rule 701-46.8 - New Job Tax Credit From Withholding

Current through Register Vol. 47, No. 3, July 24, 2024
The Iowa industrial new jobs training program is a program
				  administered by the economic development authority for projects established by
				  a community college for the creation of jobs by providing education and
				  training of workers for new jobs for new or expanding industries. For employers
				  that have entered into an agreement with a community college under Iowa Code
				  chapter 260E, a credit equal to 1.5 percent of the wages paid by the employer
				  to each employee covered by the agreement can be taken on the Iowa withholding
				  tax return. If the amount of withholding by the employer is less than 1.5
				  percent of the wages paid to the employees covered by the agreement, the
				  employer can take the remaining credit against Iowa tax withheld for other
				  employees. An employee does not include a resident of Illinois who earns wages
				  in Iowa since these employees are not subject to Iowa withholding tax in
				  accordance with the Iowa-Illinois reciprocal tax agreement discussed in
				  701-subrule 38.13(1). The administrative rules for the Iowa industrial new jobs
				  training program administered by the economic development authority may be
				  found in 261-Chapter 5.
This rule is intended to implement Iowa Code section
				  260E2. as amended by
				  2012 Iowa Acts, Senate File 2212, and section
				  260E5..
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 46 - Withholding › Rule 701-46.9 - Supplemental New Jobs Credit From Withholding and Alternative Credit for Housing Assistance Programs

Current through Register Vol. 47, No. 3, July 24, 2024
(1)
Supplemental new jobs credit from withholding.
For eligible
				businesses approved by the economic development authority under Iowa Code
				section 15A. 7, a credit equal to an additional 1.5 percent of the wages paid
				to employees in new jobs for these eligible businesses can be taken on the Iowa
				withholding tax return. This supplemental new jobs credit is in addition to the
				credit described in rule
				701-468.
				(260E). The administrative rules for the supplemental new jobs credit from
				withholding may be found in 261-paragraph 59.6(3) "a. "
(2)
Alternative credit for housing
				assistance programs.
As an alternative to the credit described in
				subrule 46.9(1) for eligible businesses in an enterprise zone, a business may
				provide a housing assistance program in the form of down payment assistance or
				rental assistance for employees in new jobs. A credit equal to 1.5 percent of
				the wages paid to employees participating in a housing assistance program may
				be claimed on the Iowa withholding tax return for wages paid prior to July 1,
				2009. Effective July 1, 2009, the alternative credit for housing assistance
				programs was repealed. The administrative rules for the enterprise zone program
				administered by the Iowa department of economic development may be found in
				261-Chapter 59.
This rule is intended to implement Iowa Code section
				  15A7.
				  and 2014 Iowa Code sections
				  15E196. and
				  15E197..
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 48 - Composite Returns › Rule 701-48.1 - Composite Returns

Current through Register Vol. 47, No. 3, July 24, 2024
For tax years of nonresident partners, members, shareholders,
				  or beneficiaries which begin on or after January 1, 1987, a partnership,
				  limited liability company, S corporation, or trust may be allowed or be
				  required to file a composite return and pay the tax due on behalf of the
				  nonresident partners, members, shareholders, or beneficiaries. For tax years of
				  nonresident partners, members, shareholders, or beneficiaries which begin on or
				  after January 1,1999, a partnership, limited liability company, S corporation,
				  or trust may elect or may be required to file a composite return and pay the
				  tax due on behalf of the nonresident partners, members, shareholders, or
				  beneficiaries. For tax years beginning on or after January 1, 1995,
				  professional athletic teams may be allowed or be required to file a composite
				  return and pay the tax due on behalf of nonresident team members. For tax years
				  beginning on or after January 1, 2008, nonresident trusts or estates which are
				  partners, members, shareholders or beneficiaries in partnerships, limited
				  liability companies, S corporations or estates or trusts may elect or may be
				  required to file a composite return and pay the tax due on behalf of the
				  nonresident trusts or estates.
This rule is intended to implement Iowa Code section
				  42213. as
				  amended by 2007 Iowa Acts, House File 923, section 15.
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 48 - Composite Returns › Rule 701-48.2 - Definitions

Current through Register Vol. 47, No. 3, July 24, 2024
For the purposes of this chapter:
"Employee"
means a nonresident member of a
				  professional athletic team as defined in subrule
				  701-4046.
				  (1).
"Partner "
includes a member of a limited
				  liability company which is treated as a partnership for tax purposes.
"Taxpayer "
means a partnership, limited
				  liability company, S corporation, professional athletic team, or trust which
				  files a return and pays the tax on behalf of the nonresident partners, members,
				  shareholders, employees, beneficiaries, estates or trusts.
"Tax year"
means the tax year of the
				  partners, shareholders, employees, beneficiaries, estates or trusts included in
				  the composite return.
This rule is intended to implement Iowa Code section
				  42213..
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 48 - Composite Returns › Rule 701-48.5 - Composite Return Required by Director

Current through Register Vol. 47, No. 3, July 24, 2024
The director may in accordance with rule
				  701-483.
				  (422) require the filing of a composite return under the following
				  conditions.
(1) The director may
				require the filing of a composite return if the nonresident partners,
				shareholders, or beneficiaries do not file individual income tax returns and
				pay the tax due.
(2) Where some of
				the nonresident partners, shareholders, or beneficiaries file individual income
				tax returns and pay the tax due, but other nonresident partners, shareholders,
				or beneficiaries do not file individual returns, the director may require a
				composite return which includes the Iowa taxable income of those nonresident
				partners, shareholders, or beneficiaries who did not file individual
				returns.
(3) For tax years
				beginning on or after January 1, 2010, if it is determined that it is necessary
				for the efficient administration of Iowa individual income tax, the director
				may require the filing of a composite return for nonresidents other than
				nonresident partners, members, beneficiaries or shareholders in partnerships,
				limited liability companies, trusts or S corporations.
For example, the director may require a composite return in
				  situations where nonresident real estate brokers or nonresident insurance
				  agents who are independent contractors earn commission income from the sale of
				  real estate in Iowa or from insurance policies sold to Iowa residents.
This rule is intended to implement Iowa Code section 422.13
				  as amended by 2009 Iowa Acts, Senate File 478, section 132.
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 48 - Composite Returns › Rule 701-48.6 - Determination of Composite Iowa Income

Current through Register Vol. 47, No. 3, July 24, 2024
Because a composite return is filed on behalf of the
				  nonresident partners, shareholders, employees, or beneficiaries, it must be
				  based upon the tax year of the majority of its partners, shareholders,
				  employees, or beneficiaries. The composite return must be filed on Form lA
				  1040C, "composite Iowa Individual income Tax Return." Attach schedules as
				  necessary to explain the return. For the purposes of this rule, federal income
				  means federal ordinary income (loss) from trade or business activities plus
				  those items of income which flow through separately less expense items which
				  flow through separately to the partners, shareholders, or beneficiaries joining
				  in the filing of a composite return.
1. Adjustments to federal income. For
				partnerships and trusts, make those adjustments to federal income set forth in
				Iowa Code section
				4227..
				For S corporations, make those adjustments to federal income set forth in Iowa
				Code section
				42235..
2. Apply the allocation and apportionment
				provisions of 701-Chapter 54 or rule
				701-4046.
				(422) for allocation of compensation paid to nonresident employees of
				professional athletic teams.
3.
				Deduct one standard deduction equal to the amount allowed a single taxpayer,
				not to exceed the amount of income attributable to Iowa, for each nonresident
				partner, shareholder, employee, or beneficiary included in the composite
				return.
4. For tax years beginning
				on or after January 1, 1989, deduct an amount in lieu of a federal tax
				deduction based upon the following schedule.
0 -
- $49,999
No deduction
$50,000 -
- $99,999
5% of net income attributable to Iowa
$100,000 -
- $199,999
10% of net income attributable to Iowa
$200,000
and over
15% of net income attributable to Iowa
5. A
				net operating loss carryback or carryforward is allowed. See 701-subrule
				40.18(3). In lieu of a net operating loss carryback, the taxpayer may elect to
				carry the loss forward.
This rule is intended to implement Iowa Code section
				  422.13.
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 48 - Composite Returns › Rule 701-48.7 - Determination of Composite Iowa Tax

Current through Register Vol. 47, No. 3, July 24, 2024
(1) The tax will be computed in accordance
				with Iowa Code section
				4225.,
				including the alternative minimum tax as though a resident.
(2) Deduct from the computed tax one personal
				exemption credit of $20 ($40 for tax years beginning on or after January
				1,1998) for each nonresident partner, shareholder, employee, or beneficiary
				included in the composite return.
Example: For tax year 1991, X corporation is an S
				  corporation, all of whose shareholders but one are nonresidents who have
				  elected to join in the filing of a composite return. The three electing
				  shareholders' share of income or loss is 87 percent of the corporation's total
				  income. The S corporation's net income is $800,000, and income items totaling
				  $6,000 and expenses of $500,000 flow directly to the shareholders. The
				  corporation has 25 percent of its sales with an Iowa destination. The
				  corporation has tax preferences and adjustments of $475,000. The composite tax
				  liability would be computed as follows:
Net income attributable to electing shareholders $800,000 x
				  87% $696,000
Add: electing shareholders' share of income items which flow
				  separately to shareholders $6,000 x 87% 5,220
Less: electing shareholders' share of expenses which flow
				  separately to shareholders $500,000 x 87% 435,000
Income attributable to electing shareholders $266,220
Times the Iowa business activity ratio 25%
Net income attributable to Iowa $ 66,555
Less: one standard deduction per shareholder 3 x $1,280
				  <435,000>
Federal tax deduction $66,555 * 5% 3,328
Iowa taxable income $ 59,387
Computed tax $4,515
Less: one personal exemption credit per shareholder 3 * $20
				  < 60>
Iowa tax $ 4,455
The alternative minimum tax would be computed as
				  follows:
Iowa taxable income $ 59,387
Add: tax preferences and adjustments attributable to electing
				  shareholders times Iowa activity ratio $475,000 x 87% x 25% 103,313
$162,700
Less: exemption 35,000
Minimum taxable income $127,700
times minimum tax rate 7.5% x .075
Computed minimum tax $ 9,578
Less regular tax < 4,455>
Minimum tax liability $ 5,123
This rule is intended to implement Iowa Code section
				  422.13.
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 48 - Composite Returns › Rule 701-48.8 - Estimated Tax

Current through Register Vol. 47, No. 3, July 24, 2024
Taxpayers filing composite returns are not required to make
				  payments of estimated tax. However, if taxpayers desire to make estimated
				  payments, the estimated payments should be made on Form lA 1040ES using the
				  partnership's, S corporation's, or trust's identification number assigned by
				  the department in lieu of the social security number.
This rule is intended to implement Iowa Code section
				  42213..
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 49 - Estimated Income Tax for Individuals › Rule 701-49.1 - Who Must Pay Estimated Income Tax

Current through Register Vol. 47, No. 3, July 24, 2024
(1)
General rule.
For tax years beginning on or after January 1,
				1990, estimated payments are required if the taxpayer's income tax liability
				attributable to incomes not subject to withholding is expected to be $200 or
				more. The amount of estimated tax paid must be used as a credit on the
				taxpayer's individual income tax return.
(2)
Joint estimate payments by
				married taxpayers. A
husband and wife may make a joint estimate tax
				payment on one form as if they were one taxpayer. If a joint estimate payment
				is made, but the husband and wife elect to file separate returns or separately
				on the combined return form, the estimate tax paid for the tax year by the
				husband and wife shall be allocated between the spouses on their returns in the
				proportion that each spouse's net income not subject to withholding tax relates
				to the combined net income of both spouses not subject to withholding
				tax.
(3)
Separate estimate
				tax payments by married taxpayers. A
husband and wife may each make
				separate estimate payments. If separate estimate payments are made by married
				taxpayers, each spouse is to claim only the estimate payments made by that
				spouse.
(4)
Examples of
				types of taxpayers who may be required to make estimate payments.
Listed below are examples of various types of taxpayers who may be required to
				make estimated tax payments. The list is for illustrative purposes and is not
				deemed to be all-inclusive.
1.
Self-employed.
An individual having taxable income from a
				trade or business where the individual has control of the work, the services
				rendered, and the fees and charges for services rendered or merchandise
				sold.
2.
Retiree.
An individual receiving pensions, annuities, and social security benefits or
				other incomes not subject to withholding after the taxpayer has withdrawn from
				active employment.
3.
Farmers and fishers.
Individuals deriving at least two-thirds
				of yearly income from farming or fishing activities.
4.
Nonresident.
Any
				individual who resides out of state and receives taxable income from an Iowa
				source which is not subject to withholding.
5.
Beneficiaries of estates and
				trusts.
Any resident or nonresident individual who is the recipient of
				income from an estate or trust from an Iowa source.
6.
Taxpayers with income in addition
				to wages.
An individual drawing salary or wages subject to withholding
				tax, having additional taxable income from an Iowa source which is not subject
				to withholding, such as interest, dividends, capital gains, rents, royalties,
				business income, or farm income.
7.
Agricultural worker.
Any worker receiving a wage or salary for
				agricultural labor which is excluded by law for withholding tax purposes.
This rule is intended to implement Iowa Code section
				  422.16.
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 49 - Estimated Income Tax for Individuals › Rule 701-49.4 - Special Estimated Tax Periods

Current through Register Vol. 47, No. 3, July 24, 2024
(1)
Short taxable year.
A
				taxpayer having a taxable year of less than 12 months must make estimated tax
				payments if anticipating an Iowa tax liability of $50 or more for that short
				tax year if that tax year began prior to January 1, 1990. In the case of short
				tax years beginning on or after January 1, 1990, taxpayers would be required to
				make estimated payments if their anticipated Iowa tax liabilities were $200 or
				more from incomes not subject to withholding.
(2)
Part-year resident.
a.
General rule.
Part-year
				residents moving into or out of the state must determine their Iowa estimated
				tax on the ratio of income from Iowa sources not subject to withholding tax to
				incomes from all sources.
b.
Example.
An individual moving into the state on April 15,
				having taxable income from an Iowa source which is not subject to withholding
				and an expected tax liability of $150, must make the first estimatepaymentof
				$50 by June 30 andpay the remaining balance of $100 in two equal installments
				of $50 each by September 30 and by January 31 of the succeeding year if the tax
				year for which the estimate payments were made began prior to January 1, 1990.
				A similar procedure for making estimate payments would be followed for tax
				years beginning on or after January 1,1990, when no estimate payments would be
				required unless the anticipated state income tax liability for the balance of
				the tax year would be $200 or more.
This rule is intended to implement Iowa Code section
				  422.16.
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 49 - Estimated Income Tax for Individuals › Rule 701-49.5 - Reporting Forms

Current through Register Vol. 47, No. 3, July 24, 2024
(1)
Resident forms
. Blank estimate tax forms are available from
				the department for resident taxpayers making state estimate payments.
(2)
Nonr esident
				forms
. A special nonresident estimate tax form with instructions is
				available from the department for any nonresident wishing to make estimate tax
				payments in lieu of having Iowa income tax withheld by an Iowa withholding
				agent. The estimated payment should be submitted with the certificate or the
				release from withholding described in subrule 49.3(2).
This rule is intended to implement Iowa Code section
				  42216..
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 49 - Estimated Income Tax for Individuals › Rule 701-49.6 - Penalty-underpayment of Estimated Tax

Current through Register Vol. 47, No. 3, July 24, 2024
The civil penalty provided by the Internal Revenue Code for
				  underpayment of federal estimated tax also applies to persons required to make
				  payments of estimated tax under provisions of the Iowa Code. The Iowa penalty
				  for underpayment of estimated tax is computed on Form lA 2210 for individual
				  taxpayers other than farmers and fishers and Form lA 221 OF for individuals who
				  have two-thirds of their gross annual incomes from farming or fishing
				  activities.
(1)
Exceptions
				which may avoid the underpayment penalty.
The following are the two
				exceptions under which taxpayers may avoid the penalty for underpayment of
				estimated tax:
a. Current year payments equal
				or exceed prior year's liability. Taxpayers may avoid the penalty for
				underpayment of estimated tax if the estimated tax payments and other tax
				payments for the current tax year, such as withholding tax, are equal to or
				exceed the tax liability for the prior tax year The prior tax year must cover a
				12-month period and there must have been a tax liability on the return for the
				prior year For tax years beginning on or after January 1, 1987, the requirement
				that the return for the prior tax year must have had a tax liability is
				eliminated although the return must have covered a 12-month period.
b. Current year payments equal or exceed 80
				percent, or 90 percent for tax years beginning on or after January 1, 1987, of
				the tax on the taxpayer's annualized income. Taxpayers may also avoid the
				penalty for underpayment of estimated tax, if their tax payments for the tax
				year are equal to or exceed 80 percent of the tax on the taxpayer's annualized
				income for periods from the first of the tax year to the end of the month
				preceding the month in which an installment of estimated tax is due. For tax
				years beginning on or after January 1, 1987, taxpayers may avoid the penalty
				for underpayment of estimated tax if their tax payments for the tax year are
				equal to or exceed 90 percent of the tax on the taxpayer's annualized
				income.
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 50 - Apportionment of Income for Resident Shareholders of S Corporations › Rule 701-50.1 - Apportionment of Income for Resident Shareholders of S Corporations

Current through Register Vol. 47, No. 3, July 24, 2024
For tax years beginning on or after January 1, 1998, resident
				  shareholders of all S corporations which carry on business within and without
				  Iowa may, at their election, determine the S corporation income allocable to
				  sources within Iowa by allocation and apportionment of the S corporation
				  income. For tax years beginning on or after January 1, 2013, estates and trusts
				  with a situs in Iowa which are shareholders in S corporations which carry on
				  business within and without Iowa can take advantage of these apportionment
				  provisions. The criteria to determine whether the S corporation is carrying on
				  business within and without Iowa is set forth in 701-subrule 54.1(4).
For tax years beginning on or after January 1,1997, a
				  shareholder in an S corporation which carries on business within and without
				  Iowa which has elected to apportion income and then elects not to apportion
				  income shall not reelect to apportion income for three tax years immediately
				  following the first tax year in which the shareholder elected not to apportion
				  income, unless the director of revenue consents to the election.
This rule is intended to implement Iowa Code section
				  4225.,
				  subsection 1, paragraph
"j,"
as amended by 2013 Iowa Acts,
				  Senate File 452.
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 50 - Apportionment of Income for Resident Shareholders of S Corporations › Rule 701-50.2 - Definitions

Current through Register Vol. 47, No. 3, July 24, 2024
For purposes of this chapter the following definitions
				  apply:
"Carrying on business within and without the state.
				  "
See subrule 54.1(4) for a definition of this term.
"Value-added corporation "
means a
				  corporation that purchases, receives, or holds personal property of any
				  description, and which adds to its value by a process of manufacturing,
				  construction, processing, or combining of different materials, and shall
				  specifically include the economic activity identified in the major groups of
				  standard industrial classifications below, with a view to selling the finished
				  product for gain or profit.
DIVIS10N C-CONSTRUCTION
Major Group 15-Building construction-General contractors and
				  operative builders.
Major Group 16-Heavy construction other than building
				  construction-Contractors.
Major Group 17-Construction special trade contractors.
DIVIS10N D-MANUFACTURING
Major Group 20-Food and kindred products.
Major Group 21-Tobacco products.
Major Group 22-Textile.
Major Group 23-Apparel and other finished products made from
				  fabrics and similar materials.
Major Group 24-Lumber and wood products except
				  furniture.
Major Group 25-Furniture and fixtures.
Major Group 26-Paper and allied products.
Major Group 27-Printing, publishing, and allied
				  industries.
Major Group 28-Chemicals and allied products.
Major Group 29-Petroleum refining and related
				  industries.
Major Group 30-Rubber and miscellaneous plastics
				  products.
Major Group 31-Leather and leather products.
Major Group 32-Stone, clay, glass, and concrete
				  products.
Major Group 33-Primary metal industries.
Major Group 34-Fabricated metal products, except machinery
				  and transportation equipment.
Major Group 35-Industrial and commercial machinery and
				  computer equipment.
Major Group 36-Electronic and other electrical equipment and
				  components, except computer equipment.
Major Group 37-Transportation equipment.
Major Group 38-Measuring, analyzing, and controlling
				  instruments: photographic, medical, optical goods, watches and clocks.
Major Group 39-Miscellaneous manufacturing industries.
A corporation engaged in more than one business activity is a
				  value-added corporation if more than 50 percent of its gross receipts, figured
				  on a three-year average, or such shorter period as the corporation shall have
				  been in existence, are from manufacturing, construction, processing, or
				  combining of different materials and include the processes identified
				  above.
This rule is intended to implement Iowa Code section
				  4224..
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 50 - Apportionment of Income for Resident Shareholders of S Corporations › Rule 701-50.4 - Computation of Net S Corporation Income

Current through Register Vol. 47, No. 3, July 24, 2024
After making the adjustments in Iowa Code section
				  42235.,
				  net S corporation income is computed by adding to or subtracting from the S
				  corporation's ordinary income (loss) from a trade or business those items of
				  income, losses, and expenses that flow directly to the shareholder whose
				  separate treatment could affect the tax liability of the shareholder In
				  computing the amounts of income, losses, and expenses that flow directly to the
				  shareholder, these items of income, losses, and expenses, except for interest
				  exempt from federal income tax and itemized deductions for high-income
				  individuals, must be reduced proportionately to the amount that the sum of all
				  like amounts of income, losses, and expenses are reduced for federal income tax
				  computations.
This rule is intended to implement Iowa Code section
				  4228.,
				  subsection 2, as amended by 1996 Iowa Acts, chapter 1197.
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 50 - Apportionment of Income for Resident Shareholders of S Corporations › Rule 701-50.5 - Computation of Federal Tax on S Corporation Income

Current through Register Vol. 47, No. 3, July 24, 2024
The amount of federal income tax related to the items of
				  income, losses, and expenses from an S corporation is to be computed by
				  dividing the sum of the items of income, losses, and expenses by federal
				  adjusted gross income, and the result multiplied by the sum of the federal
				  income tax and the federal alternative minimum tax. This resulting tax figure
				  is to be reduced by the nonrefundable federal tax credits relating to the S
				  corporation income which are a reduction in tax rather than a payment of tax.
				  Credits that are deemed to be a payment of tax include, but are not limited to,
				  backup withholding on interest, dividends and other types of income, and credit
				  for motor vehicle fuel taxes.
For tax periods beginning prior to January 1, 2002, the
				  distribution received from the S corporation is reduced by 50 percent of the
				  federal tax paid by the shareholder on the S corporation income. For tax
				  periods beginning on or after January 1,2002, the distribution received from
				  the S corporation is reduced by 100 percent of the federal tax paid by the
				  shareholder on the S corporation income.
This rule is intended to implement Iowa Code section
				  4228.,
				  subsection 2, as amended by 2002 Iowa Acts, House File 2078.
Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 50 - Apportionment of Income for Resident Shareholders of S Corporations › Rule 701-50.6 - Income Allocable to Iowa

Current through Register Vol. 47, No. 3, July 24, 2024
In order to determine the amount of income allocable to Iowa
				  from an electing S corporation, apply the allocation and apportionment rules in
				  701-Chapter 54.
This rule is intended to implement Iowa Code section
				  4228.,
				  subsection 2, as amended by 1996 Iowa Acts, chapter 1197.