According to IA 130 "Iowa Out-of-State Tax Credit Schedule" - Part-year residents of Iowa may claim this credit only if any income earned while an Iowa resident was also taxed by another state, local jurisdiction, or foreign country. Technically this income that is taxed by NE was earned as a resident of NE and not IA. I was audited by IA IRS for this back in 2012 because my tax preparer claimed this credit on my IA return when indeed I did not live in IA making this income and cannot claim credit for it.
