Relating to state taxation by modifying alternate and individual income tax rates, and including effective date and retroactive applicability provisions

Where it is now

1. ✓
   Done: IntroducedFebruary 26, 2024
2. –
   Skipped: SubcommitteeSkipped
3. ✓
   Done: Senate committeeFebruary 26, 2024
4. ✕
   Stopped: Passes the SenateDied when the General Assembly ended
5. Next: House committee
6. Next: Passes the House
7. Next: To the Governor
8. Next: Signed into law

Died when the session ended The General Assembly adjourned on April 19, 2024. Bills that didn’t pass both chambers died. What’s a funnel?

What’s in it

This bill relates to state taxation by modifying alternate and individual income tax rates. The bill strikes the graduated individual income tax rates that go into effect in tax years 2024 and 2025, and establishes new individual income tax flat rates beginning in tax years on or after January 1, 2024.65 percent.50 percent.90 percent goes into effect for tax years beginning on or after January 1, 2026.21(5) due to removing income tax brackets and establishing the individual income tax flat rate commencing with tax years beginning on or after January 1, 2024.

From the explanation printed with the bill as introduced, written by the Legislative Services Agency. Amendments adopted later aren’t reflected. Full bill text

Fiscal note

Less revenue: up to $1.63B Compare with other bills

The individual income tax rate changes in Senate File 2398 are projected to decrease net individual income tax liability and State General Fund revenue by the following amounts: • FY 2024 = $279.3 million • FY 2025 = $1,627.4 million • FY 2026 = $901.3 million • FY 2027 = $377.7 million • FY 2028 = $385.2 million • FY 2029 = $396.3 million • FY 2030 = $408.0 million The decrease in tax liability is also projected to decrease the statewide local option income surtax for schools by the following amounts: • FY 2024 = $0.0 million • FY 2025 = $35.1 million • FY 2026 = $28.8 million • FY 2027 = $9.1 million • FY 2028 = $9.4 million • FY 2029 = $9.7 million • FY 2030 = $9.9 million

• Individual Income Tax · March 1, 2024

Nonpartisan cost estimates from the Legislative Services Agency’s Fiscal Services Division. The newest is first. Reading a fiscal note

Iowa Code it changes

Amends§421.27§422.16§422.16B§422.16C§422.21§422.25A§422.5

Repeals§422.5A

Read from the bill as introduced. Each links to every bill touching that chapter of the Iowa Code. How the Code works