Iowa return is asking if 2/3 of income came from farming. Are they asking if farming income is 2/3 of Iowa income or 2/3 of Federal income?

It depends. It  is likely asking if your income is from farming to reduce any underpayment penalty which would be for the federal return. Check to see if you have a balance due on your tax return.  You can review your tax return following the information below.

 

From the left rail menu in TurboTax Online, select Tax Tools (You may have to scroll down on the left rail menu.)

1. Select Tax Tools
2. On the drop-down select Tools
3. On the pop-up menu titled “Tools Center”, select View Tax Summary 
4. On the left sidebar, select Preview my 1040 

For TurboTax Desktop, change to 'Forms' and review the forms 

 

The state return will be visible as well.                    

 

Still not sure how to answer the specific question. I’m non- resident of Iowa and farming accounts for 100% of my Iowa income but only a small % of my Federal taxable income. 

IF 100% of the farming income was sourced in Iowa, you may answer "yes" to the question that at least 2/3 of the income came from farming. Since you're a nonresident, the only income that should be taxable in Iowa is the farm income.

 

Be sure to look for any blue links on the page with this question that may help explain how to answer.