Iowa State Tax Pension and Retirement Income Exclusion
Residents of Iowa may be eligible to exclude a portion of their pension and retirement income from state taxable income, providing relief for retirees and those nearing retirement. This exclusion is designed to reduce the tax burden on individuals who rely on retirement income.
Eligibility Criteria
- Individuals who are 55 years of age or older.
- Individuals who are disabled.
- Qualifying survivors (as defined by Iowa tax law).
Exclusion Amounts
The exclusion amount varies based on filing status:
- Single filers: Up to $6,000 in taxable pension, annuity, or IRA income may be excluded.
- Married filers: Up to $12,000 in taxable pension, annuity, or IRA income may be excluded.
Note: Roth IRA distributions and Social Security benefits are already excluded from Iowa taxable income and do not count toward this exclusion limit.
Important Notes
- This exclusion applies only to non-exempt pension, annuity, and IRA income received while residing in Iowa.
- The exclusion does not apply to all types of retirement income—only those specifically listed in Iowa tax regulations.
- Individuals must file an Iowa income tax return if they meet the residency and income criteria outlined in the Iowa Department of Revenue’s instructions.
Source:
Iowa State Instruction
Form IA 1040 - Individual Income Tax Return
Disclaimer: Always verify details with the official Federal or State Department of Revenue Forms and Instructions before filing your tax return.