This information was sent via GovDelivery to those subscribed to receive Law & Policy updates from the Department. Indexation is meant to protect taxpayers from paying higher income taxes solely as a result of inflation.
Tax brackets for 2021 code#
Iowa Code section 422.5 details indexation of Iowa income tax brackets. Indexation of the standard deductions is covered in Iowa Code sections 422.9 and 422.21. These tax features are determined each year by applying inflation factors to, or “indexing,” the previous year’s amounts. Iowa law provides for the indexation of individual income tax brackets and standard deduction amounts. Tax year 2021 income tax brackets are shown in the table below.
Rounded to the nearest whole percent, this average is 4.0 percent. The prime rate averaged 3.94 percent over the past twelve months. For the tax year 2021, the maximum tax rate for individual single taxpayers with earnings over 523,600 (628,300 for married couples filing jointly) remains 37 percent.The other rates are as follows: 12 for incomes over 9,950 (19,900 for married couples filing jointly). Iowa law requires that this average be rounded to the nearest whole percent and two percentage points to be added to it. What are the 2021 Tax Brackets for Married Filing Jointly. The annual rate is based on the average monthly prime rate during the preceding twelve month period, October through September. Iowa Code Section 421.7 specifies the procedures for calculating the Department’s annual and monthly interest rates. Starting January 1, 2021, the interest rate for taxpayers with overdue payments will be: Des Moines, Iowa – The Iowa Department of Revenue has finalized individual income tax brackets and individual income tax standard deduction amounts for the 2021 tax year (applicable for taxes due in 2022) and the 2021 interest rate, which the agency charges for overdue payments.
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