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Iowa Income Tax Withholding and Payroll Information

Compliance with state taxes is required for every employer. Learn about the flat rate, deductions, and automation options below.

December, 17th 2024

A team using ez1095 software for small businesses

Each state has unique requirements for income tax withholding. Below you will find the details for Iowa’s 2025 withholding structure, which utilizes a flat tax rate, along with applicable standard deductions and allowances.

Employers must also adhere to federal income tax withholding rules. More information can befound here about federal rates.

Alternatively, employers can automatically calculate payroll withholding using ezPaycheck.

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Table of Contents

Iowa Tax Information

General Information
State AbbreviationIA
State Tax Withholding State Code19
Acceptable Exemption FormIA W-4 or federal W-4 (check Iowa instructions)
Basis For WithholdingState Standard Deduction and Allowances
Acceptable Exemption DataFiling Status / Number of Allowances
TSP DeferredYes
Special Coding

Determine the Total Number Of Allowances Claimed field as follows:

First Position - Enter 0 (zero).

Second and Third Positions - Enter the number of allowances claimed.

Additional InformationFor more details, refer to official Iowa withholding publications.

Deductions, Allowances, and Exemptions

Standard Deduction Table (2025)
Filing StatusStandard Deduction
Single, Married (Dual Income), Other$12,000
Head of Household$18,050
Married (Single Income)$24,050
Annual Exemption Amount per Allowance
AllowanceAnnual Amount
Each Allowance$40

Multiply the number of allowances by $40 to determine the total allowance amount to subtract.

How to Calculate Iowa Taxes

  1. Subtract the nontaxable biweekly Thrift Savings Plan (TSP) contribution from the gross biweekly wages.
  2. Subtract the nontaxable biweekly Federal Health Benefits Plan payments (including dental, vision, and flexible spending accounts) from the amount computed in Step 1.
  3. Add taxable fringe benefits (e.g., taxable life insurance) to the amount computed in Step 2 to obtain the adjusted gross biweekly wages.
  4. Multiply the adjusted gross biweekly wages by 26 to obtain the gross annual wages.
  5. Subtract the appropriate standard deduction (based on filing status) from the gross annual wages to determine the taxable income.
  6. Calculate the gross tax by applying the flat 3.8% rate to the taxable income:
    Gross Tax = Taxable Income × 3.8%
  7. Subtract the total allowance amount ($40 × Number of Allowances) from the gross tax to determine the net tax.
  8. Add any additional withholding (if applicable) to the net tax.
  9. Divide the final annual Iowa tax withholding by 26 to obtain the biweekly Iowa tax withholding.

With no tax brackets, Iowa’s calculation is simpler. If you prefer to automate these calculations, consider using ezPaycheck.

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Automate Payroll with ezPaycheck

ezPaycheck is easy-to-use payroll software designed with small businesses in mind: simple, reliable, and affordable. It helps you calculate taxes, print paychecks for employees & contractors, generate reports, and print tax forms. No internet connection needed.

Try it free for 30 days with no obligation and no credit card needed. ezPaycheck is available for both Windows and Mac computers.

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