Iowa State Tax Credits

More ways to save your hard-earned money from the tax man!

Iowa has some great State Tax Credits for you....

Thank you so much for checking our resource out here for your state and congratulations for taking a proactive step to paying less in taxes. For your state, we have identified the tax credits that are currently being offered to help you pay less in state taxes.

We hope this resource is helpful to you, and if there is something you feel we have missed, please let us know!

It would be completely arrogant of us to think that we know all things and if we missed something we want to know so we can vet that and help you and our other friends in the entrepreneurial community pay less in taxes! And if you found this helpful, you should check out our DIY resources inside of our Tax Savings Communities (found at www.MakeTaxesFair.com/Our-Communities).

We're also ready to help you if you want to skip the line of the DIY process and get help directly from us. To learn more about how we help our clients check out www.MakeTaxesFair.com/Get-My-Roadmap

 
Iowa

New Jobs Tax Credit

Overview:
The Iowa New Jobs Tax Credit incentivizes businesses to create jobs through the state's Industrial New Jobs Training Program (260E). Companies can receive a credit worth 6% of wages paid for eligible new jobs, providing significant tax relief to support workforce expansion.

Who It’s For:
Iowa businesses participating in the 260E training program that have grown their workforce by at least 10% and are seeking corporate or individual income tax relief.

Four Key Highlights:

  1. 6% Wage-Based Credit – Up to $2,370 Per New Employee

    • Businesses can claim 6% of wages paid to each new qualifying employee, capped at the taxable wage base, with a maximum of $2,370 per employee in 2025.

  2. Must Participate in 260E and Grow Workforce by 10%

    • Eligibility requires formal enrollment in the Iowa 260E training program and an employment increase of 10% or more.

  3. Nonrefundable but Generous 10-Year Carryforward

    • Credits that exceed the company’s tax liability can be carried forward for up to 10 years, offering long-term benefits for growing businesses.

  4. Limited Awareness – Huge Opportunity for Qualifying Companies

    • With only 17.3% of eligible businesses currently claiming it, there’s a major underutilized advantage especially for small to mid-sized businesses willing to engage with Iowa’s workforce training system.

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Endow Iowa Tax Credit

Overview:
The Endow Iowa Tax Credit rewards charitable giving by offering a 25% state income tax credit to individuals and couples who donate to qualified Iowa community foundations, promoting philanthropy across the state.

Who It’s For:
Iowa taxpayers making charitable contributions to qualified Iowa community foundations who want to maximize both their philanthropic impact and tax savings.

Four Key Highlights:

  1. 25% State Income Tax Credit for Eligible Donations

    • Donors receive a 25% Iowa state tax credit on qualifying gifts like cash, real estate, appreciated securities, retirement assets, or farmland — with no minimum donation required.

  2. High Annual Credit Limits

    • $100,000 maximum credit per individual per year (based on a $400,000 donation).

    • $200,000 maximum credit per married couple (based on an $800,000 donation, if filing jointly).

  3. First-Come, First-Served – Limited Annual Allocation

    • Once the state’s credit cap is reached for the year, new applicants will be eligible for the next year’s credits — so early application is crucial.

  4. Five-Year Carryforward but No Waitlist Moving Forward

    • Unused tax credits can be carried forward for up to five years.

    • Important: The waitlist system was discontinued, simplifying the process but increasing the importance of prompt action.

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