The Iowa Trust Fund Tax Credit is back for another year on Iowa tax returns, but it’s not as generous.
The credit this year is $15 per person or $30 for a married couple filing a joint return. Last year, the credit was $54/person.
The reason for the decrease is because of the formula the state uses for calculating how much the credit is worth. The credit is based on how much money is in the “Iowa Trust Fund” and how many taxpayers were eligible to claim the credit in the prior year.
The credit shall be equal to the quotient of the amount transferred to the Iowa taxpayers trust fund tax credit fund in the applicable fiscal year, divided by the number of eligible individuals for the tax year immediately preceding the tax year for which the credit in this section is allowed, as determined by the director of revenue in accordance with this section, rounded down to the nearest whole dollar.
The credit is non-refundable. For more information, check out the story I did on the credit last year. (In the examples in that post, simply insert “$15” everywhere you see $54.)