IL and IA have a reciprocal agreement. Reciprocity agreements mean that two states allow its residents to only pay tax on where they live—instead of where they work.
Your daughter's unemployment benefits are taxable in the state she lived at the time she received the unemployment benefits.
On IA non-resident return, enter 0 on the screen that asks for the amount of income earned in that state. This will eliminate any tax liability for that state, resulting in a full refund.
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