Questions & Answers

What federal taxes can I deduct on my Iowa return?

Taxpayers can deduct their entire federal tax paid during 2020 for tax year 2019 and any other prior years for which an Iowa income tax return was required to be filed.

However, certain amounts must be added back to your Iowa income, including the following:

  • Federal self-employment tax
  • Federal household employment tax
  • Excess advance premium tax credit repayment
  • Unreported Social Security and Medicare tax
  • Additional tax on IRAs and other qualified retirement plans
  • First-time homebuyer credit repayment
  • Additional Medicare tax
  • Other additional federal taxes reported on Schedule 2, Line 8c of the federal 1040
The self-employment tax, household employment tax, and/or other federal taxes as listed above will be added back for the current year, but the federal withholding, estimated payments, and additional federal tax payments for the current year will be deducted when they are paid in the following year.

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