Iowa State Taxes 2025. Employers must withhold iowa income tax from their wages. Division iii of this legislation amends iowa code section 422.16 to clarify that state income tax withholding is not required on distributions of retirement income that are not subject to iowa.
The iowa department of revenue announces the 2025 tax year individual income tax rate and the 2025 interest rate, which the agency charges for overdue payments. Kim reynolds signed a nearly $1 billion tax cut into law wednesday that will lower the stateโs personal income tax to a flat rate of 3.8% in 2025.