Bills › 91st General Assembly
Relating to the farm tenancy net income exclusion available against the individual income tax, and including effective date and retroactive applicability provisions
Sponsored by Rep. Bill Gustoff (R), Rep. Megan Jones (R), Rep. Derek Wulf (R)
Topics:TaxesIncome taxes
Where it is now
- Done: IntroducedJanuary 14, 2025
- Done: SubcommitteeJanuary 23, 2025
- Done: House committeeFebruary 25, 2025
- Done: Passes the HouseMarch 19, 202596–0
- Next: Senate committeeFunnel: by March 20, 2026
- Next: Passes the Senate
- Next: To the Governor
- Next: Signed into law
Became HF 624 → Its progress continues under the new number. Go to HF 624 What’s a funnel?
What’s in it
Current law excludes from the individual income tax a retired farmer’s total net income received pursuant to a farm tenancy agreement covering real property held by the retired farmer for or more years, if the farmer materially participated in a farming business for or more years. current law, net income from a farm tenancy agreement earned by an entity taxed as a partnership for federal tax purposes, an S corporation, or a trust or estate is not eligible for the farm tenancy lease income exclusion.
Read the full explanation
This bill allows the net income from a farm tenancy agreement earned, received, or reported by an entity taxed as a disregarded entity, partnership for federal tax purposes, an S corporation, a trust, or estate to be eligible for the farm tenancy lease income exclusion in the same manner as if the net income received pursuant to a farm tenancy passes directly from the farm tenant to the eligible individual rather than passing to the eligible individual through an entity taxed as a disregarded entity, a partnership, an S corporation, a trust, or an estate. The bill allows net income accruing to a grantor trust or to a business entity that is a disregarded entity to be deemed to have been distributed to its sole owner to the extent the sole owner of such disregarded entity or trust has the right to withdraw or compel distribution of such net income. The bill takes effect upon enactment and applies retroactively to 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
House subcommittee
Named January 23, 2025. On January 29, 2025 it recommended passage.
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 proposed deductions from the individual income tax in House File 624 are estimated to decrease net individual income tax liability and State General Fund revenue by the following amounts: • FY 2026 = $10.5 million • FY 2027 = $4.6 million • FY 2028 = $4.7 million • FY 2029 = $4.8 million • FY 2030 = $4.9 million The decrease in tax liability is also estimated to decrease the statewide local option income surtax for schools by the following amounts: • FY 2026 = $263,000 • FY 2027 = $115,000 • FY 2028 = $117,000 • FY 2029 = $120,000 • FY 2030 = $122,000
- Retired Farmer Lease Income Exclusion, Pass-Through Entities · March 4, 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
Lobbying
10 for · 0 against · 4 undecided · Who →
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.
Tried before
This idea has been filed in an earlier General Assembly. None became law, though one got through a chamber.
- HF 2503 Relating to the farm tenancy net income exclusion available against the individual income …90th General Assembly · Renumbered as HF 2666 · same titleCleared committee
- HF 2666 Relating to the farm tenancy net income exclusion available against the individual income …90th General Assembly · Passed House · same titlePassed a chamber
Similar bills this General Assembly
- SF 19 Relating to the farm tenancy net income exclusion available against the individual income …91st General Assembly · In committeeNearly 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.