Excluding from Iowa net income federal recovery rebates, certain paycheck protection program loan forgiveness, and pandemic-related unemployment compensation, and including effective date and retroactive applicability provisions

Current law excludes the first recovery rebate in 2020 Iowa Acts, chapter 1118, section 114. The division takes effect upon enactment. DIVISION II —— PAYCHECK PROTECTION PROGRAM (PPP). The bill excludes from the calculation of Iowa income tax the federal paycheck protection program second draw loan proceeds from the federal Consolidated Appropriations Act, 2021, Pub. L. 116-260, that are forgiven and excluded from federal gross income. Current law excludes the first round of paycheck protection program loan forgiveness in 2018 Iowa Acts, chapter 1118, section 109. The division takes effect upon enactment and applies retroactively to January 1, 2021, for tax years beginning on or after that date but before tax years beginning on or after January 1, 2022. DIVISION III —— UNEMPLOYMENT COMPENSATION. Under the bill, a taxpayer who has received compensation authorized pursuant to certain federal programs shall not include in the taxpayer’s Iowa net income the following: pandemic unemployment assistance; pandemic emergency unemployment compensation; pandemic unemployment compensation received through the memorandum issued by the president of the United States on August 8, 2020; and the extension of pandemic unemployment compensation. The division takes effect upon enactment and applies retroactively to January 1, 2020, for tax years beginning on or after that date but before January 1, 2022.