To clarify my understanding, I’ve outlined the details below:
1. We are married nonresidents in Iowa for the 2024 tax year and sold our home in 2024. Our only Iowa-source income was the capital gain from the sale.
2. The capital gain was 100% eligible for exclusion and is not required to be reported to the IRS.
3. Based on these facts, our Iowa-source net income (IA 126, line 25) was zero.
Given these information, are we required to file an Iowa return for 2024 (IA 1040 / IA 126)? We are reviewing our TurboTax results and trying to finalize our return, but it indicates that we need to file both IA 1040 and IA 126. We’re a bit confused and would appreciate any guidance. Thanks in advance.
