topic R in State tax filing

R

ankaratop — Sat, 13 Aug 2022 20:58:12 GMT

Re: K-1 income for state taxes-no money due?

DavidD66 — Tue, 30 Mar 2021 20:25:38 GMT

It sounds like you have not allocated the K-1 income to Iowa in the Iowa state return. There is a screen in the Iowa return where you enter income from Iowa sources. See screenshot below:

Re: K-1 income for state taxes-no money due?

ankaratop — Thu, 08 Apr 2021 12:38:27 GMT

I have reviewed in forms via and see that the amount of rental income from the K-1 is present. We file married separate this year and the IA 1040 tax exemption smart worksheet shows an x for “ income is less or equal to minimum income if checked.” Can this be verified somehow?

Re: K-1 income for state taxes-no money due?

SamS1 — Thu, 08 Apr 2021 17:34:20 GMT

It is always better to file separately on same form in Iowa. If you have filed jointly in the past, go back and amended your previous returns. On the Iowa return your tax is calculated on your total income less adjustments and subtractions for Federal taxes paid. Since the Iowa standard deduction amount is so low, if you have mortgage interest, RE taxes, Contributions, etc, you will want to itemize. Your tax is calculated on your total income then a nonresident credit is applied from the IA 126 based on your Iowa income to your Total income.

I would agree with $18K in Iowa based income, you should be paying something just based on the way the Iowa tax is calculated on your total income then a nonresident credit is applied.

Print off your Iowa return and look for form IA126. This is your nonresident credit form and at the bottom should be a percentage of Iowa based income to your total income. Page 1 of your Iowa return should reflect all your total income from all sources, split by taxpayer and spouse. Line 48 you should see the nonresident tax credit. Click here for link to Iowa filing requirements.