Iowa IA 1040-ES Instructions (Individual Estimated Income Tax Instructions) (2024)

Individual Estimated Income Tax Instructions
IA 1040ES Instructions, 45-009
2023 IA 1040ESIowa Individual Estimated Income Tax Instructionstax.iowa.govPay electronically using eFile & Pay.See the Department’s website for additional information regarding 2023 taxes: tax.iowa.govWho needs to file and pay estimates: Every individual ormarried couple filing a joint Iowa return that expects to havea tax liability of $200 or more from income not subject towithholding.Each individual required to make estimated payments mustfile an estimated payment under his/her name and SocialSecurity Number.Due dates: If a due date ends on a weekend or holiday asdefined in Iowa Code section 421.9A, substitute the nextregular business day for the due date.For fiscal year filers, the dates for paying the estimated taxare the last day of the fourth, sixth, and ninth months of thefiscal year, and the last day of the first month of the nextfiscal year.How to compute estimated taxes: Compute estimated taxby using one of the following methods:• Pay 5% of the anticipated Iowa gross income; or• Pay 100% of the prior year’s Iowa tax liability from IA1040, line 53, less applicable credits; or• Pay 110% of the prior year’s Iowa tax liability from IA1040, line 53, less applicable credits, if prior year’s federaladjusted gross income plus any bonus depreciationadjustment/section 179 from IA 1040, line 14 and all otherIowa net income decoupling, exceeded $150,000; or• Complete the traditional worksheet provided on page 2.Overpayment credit: If you had a refund on your 2022 Iowaincome tax return and elected to apply it as a credit to yourestimated tax, the amount is automatically posted as anestimated credit for 2023. Use the Estimated Tax PaymentSchedule to record and apply the credit. If the credit equalsor exceeds the first estimated payment, do not send anestimated voucher until a payment is due.Amending estimated tax: If your income changes duringthe year, adjust the estimated tax for the remaining quartersaccordingly.Underpayment of estimated tax: A penalty forunderpayment of estimated tax may apply if sufficientestimated payments are not submitted, regardless of thecomputation method used in calculating the estimated taxliability. Please see form IA 2210 for penalty exceptions.EXCEPTIONSNonresidents:Income from pass-through entities: If a nonresidentpartner, shareholder, or beneficiary (“member”) is includedon a pass-through entity’s (partnership, S corporation,estate, or trust) composite return under Iowa Code section422.16B, the nonresident member is not required to payestimated tax on their distributive share of income from thatpass-through entity. If a nonresident member is exempt frominclusion on the composite return or is excluded from thecomposite return pursuant to a 2023 Nonresident MemberComposite Agreement (41-175) signed by the member andthe entity, the nonresident member must include theirdistributive share of pass-through income in the calculationof their estimated tax. To obtain the 2023 NonresidentMember Composite Agreement form, visit the Department’swebsite.Other non-wage income: For Iowa-source income otherthan income from wages or a pass-through entity, Iowa lawprovides that nonresidents have the option of having Iowaincome tax withheld or paying estimated income tax. Ifpaying estimated tax is preferred, a release from withholdingmust be obtained prior to receipt of income. Complete theNonresident Request for Release from Withholding form (44017). To obtain this form, see the Department’s website.Submit the form with the tax payment and installmentvoucher to the Department at the address on the voucher. Arelease may then be furnished to the payer from theDepartment, based on the information provided.Farmers and Fishers: If 2/3 or more of estimated grossincome is from farming or commercial fishing, two additionaloptions are available:• Pay the estimated tax in one payment on or beforeJanuary 15, 2024 and file the Iowa income tax return byApril 30, 2024; or• File the Iowa income tax return and pay the tax due in fullon or before March 1, 2024.Those qualifying to make fewer than four estimatedpayments should use the installment voucher for the quarterfrom which the Iowa-source income was generated.Low income exemption from tax:Taxpayers 65 years of age or older: You are exempt if: (1)You are single and your net income is $24,000 or less, or (2)Your filing status is other than single and your combined netincome is $32,000 or less. Only one spouse must be 65 orolder to qualify for the exemption.Taxpayers under 65 years of age: You are exempt if: (1)Your net income is less than $5,000 and you are claimed asa dependent on another person’s Iowa return, or (2) You aresingle and your net income is $9,000 or less and you are notclaimed as a dependent on another person’s Iowa return, or(3) Your filing status is other than single and your combinednet income is $13,500 or less.Note: The amount of any reportable Social Security benefitsand lump-sum tax distributions of taxable income must beadded back to net income for purposes of determining thelow income exemption regardless of age.45-009a (11/01/2022)2023 Iowa Individual Estimated Income Tax, page 2If opting to use one of the methods other than the traditional worksheet, proceed to number 21 of the traditional worksheet under“Quarterly Estimated Tax Computation.”Traditional Worksheet - for taxpayer records ONLY1. Federal taxable income. Report income for both spouses if filing a joint Iowa return ..............................1. ________________2. Iowa modifications to federal taxable income ...........................................................................................2. ________________3. Iowa taxable income. Add lines 1 and 2. If less than zero, you do not owe estimatedincome tax .................................................................................................................................................3. ________________4. Compute income tax using 2023 Tax Rate Schedule below ....................................................................4. ________________5. Iowa lump-sum tax ....................................................................................................................................5. ________________6. Total estimated tax liability. Add lines 4 and 5 ..........................................................................................6. ________________7. Total credits. Personal and dependent exemptions, tuition and textbook credit,firefighter/EMS/reserve peace officer credit ..............................................................................................7. ________________8. Balance. Subtract line 7 from line 6. If you are a resident, skip line 9 ......................................................8. ________________9. Nonresidents. Enter amount of Iowa-source net income ..........................................................................9. ________________10. Percentage of Iowa income vs. total income. Nonresidents divide line 9 by line 1,round to the nearest ten-thousandth of a percent. Iowa residents enter 100% ........................................10. _____________ %11. Estimated Iowa tax. Multiply line 8 by line 10 ...........................................................................................11. _______________12. Out-of-state tax credit and any other nonrefundable Iowa credits ............................................................12. _______________13. Balance. Subtract line 12 from line 11 ......................................................................................................13. _______________14. Iowa residents’ school district or emergency medical services surtax......................................................14. _______________15. Balance. Add lines 13 and 14 ...................................................................................................................15. _______________16. Total Iowa credits: fuel tax, child and dependent care or early childhood development,Iowa earned income tax credit, other refundable Iowa credits, composite, and withholding ....................16. _______________17. Estimated tax. Subtract line 16 from line 15, rounded to the nearest dollar.Do not file estimated taxes if line 17 is less than $200.If line 17 exceeds $200, continue to line 18 directly below .......................................................................17. _______________Quarterly Estimated Tax Computation18. If the estimated tax exceeds $200, enter 100% (110% if high income taxpayer) of the prior year’stax liability, or 5% of this year’s anticipated Iowa gross income, or the amount fromline 17 on the above worksheet ................................................................................................................18. _______________19. Multiply line 18 by 0.25. This is your quarterly estimated payment amount. Enter this amountinto column A, lines 1 through 4, on the Estimated Tax Payment Schedule below..................................19. _______________2023 Tax Rate ScheduleTaxable income:Single, Head of Household, Married Filing Separately, orMarried Filing Jointly:Qualifying widower with dependent childOverBut notOf excess OverBut notOf excessoveroveroverover06,000$0plus4.4%0012,000$0plus4.4%06,000 30,000 $264plus4.82% 6,00012,00060,000$528plus4.82% 12,00030,000 75,000 $1,420.80 plus5.7%30,00060,000150,000 $2841.60 plus5.7%60,00075,000$3,985.80 plus6%75,000150,000$7,971.60 plus6%150,000Estimated Tax Payment ScheduleDateInstallment 105/01/2023Installment 206/30/2023Installment 310/02/2023Installment 401/31/2024AComputedInstallmentBRefundCarryforward/Prior PeriodOverpaymentCAmount to bePaid (column Aless column B)Example on how to compute estimated tax:The taxable income of a single taxpayer is$24,000.The calculation = $867.60 + [4.82% x ($24,000 $6,000)].The result = $867.60 + $264.00 = $1131.60.Round to the nearest dollar = $1132.0045-009b (11/01/2022)

Extracted from PDF file 2023-iowa-ia-1040-es-instructions.pdf, last modified November 2022

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About the Individual Income Tax

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