Questions & Answers

What federal taxes can I deduct on my Iowa return?

Taxpayers can deduct their entire federal tax paid during 2021 for tax year 2020 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/Uncollected Social Security and Medicare tax
  • Additional tax on IRAs and other qualified retirement plans
  • First-time homebuyer credit repayment
  • Additional Medicare tax
  • Recapture of low-income housing credit
  • Other additional federal taxes reported on Schedule 2, Line 18 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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