Exempting cash tips from the individual income tax, and including applicability provisions

Where it is now

1. ✓
   Done: IntroducedFebruary 6, 2025
2. ✓
   Done: SubcommitteeFebruary 20, 2025
3. ✓
   Done: House committeeApril 16, 2025
4. Next: Passes the House
5. Next: Senate committeeFunnel: by March 20, 2026
6. Next: Passes the Senate
7. Next: To the Governor
8. Next: Signed into law

Became HF 1030 → Its progress continues under the new number. Go to HF 1030 What’s a funnel?

What’s in it

This bill excludes from the individual income tax the amount of cash tips received and included on statements furnished to an employer as required by section 6053(a) of the Internal Revenue Code. The bill applies to tax years beginning on or after January 1, 2026.

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

House subcommittee

Named February 20, 2025. On February 25, 2025 it recommended passage.

• Rep. David E. Young REmail
• Rep. Chad Behn REmail
• Rep. Aime Wichtendahl DEmail

Three legislators hear a bill first and recommend what the committee should do; it’s the best time to weigh in. How to take part

Fiscal note

The deduction in HF 1030 will decrease revenue to the General Fund by the following amounts: • FY 2026 = $5.6 million • FY 2027 = $12.9 million • FY 2028 = $13.2 million • FY 2029 = $13.5 million • FY 2030 = $13.8 million • FY 2031 = $14.1 million The decrease in tax liability is also projected to decrease the statewide local option income surtax for schools by the following amounts: • FY 2026 = $0 • FY 2027 = $319,000 • FY 2028 = $327,000 • FY 2029 = $334,000 • FY 2030 = $342,000 • FY 2031 = $350,000

• Exemption from Income Tax, Tips · April 22, 2025

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§422.7

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

Family tree

Where this legislation came from and where it went: earlier tries, the versions it moved through this Assembly, and later bills built on it.

Earlier and later bills are matched by wording or an identical title; check the text to be sure it’s the same idea.

Similar bills

• HF 293 Exempting cash tips from the individual income tax, and including applicability provisions
  91st General Assembly · In committee
  Nearly identical
• HF 361 Exempting cash tips from the individual income tax, and including applicability provisions
  91st General Assembly · In committee
  Nearly identical

Matched by the wording of each bill’s explanation, or an identical title. Companion bills and renumbered versions of this bill aren’t listed; they’re the same bill.