What is the Iowa PTET rate?

Graduated rates apply; see the picker.

Is the Iowa owner credit refundable?

Iowa's PTET owner credit is refundable.

Does Iowa PTET affect composite-return filing?

Mandatory. Iowa § 422.16B mandates composite return filing (IA PTE-C) for nonresident members starting tax year 2022; PTET layered on top. See the composite-vs-PTET page for the full matrix.

Iowa · IA

Iowa Pass-Through Entity Tax (PTET)

Iowa's PTET regime is one of the 37+ state workarounds to the federal SALT cap (IRC §164(b)(6)). The election is annual, statute-pinned below, and interacts with composite filing and §199A QBI in state-specific ways.

Statute: Iowa Code § 422.16B (Pass-Through Entity Tax)
State DOR portal: https://tax.iowa.gov/pass-through-entity-tax
Election deadline: [PLACEHOLDER: state DOR cite] — Iowa PTET election deadline to be pinned to tax.iowa.gov/pass-through-entity-tax.
Election form: IA PTE-C (Composite Return) and PTET schedule
Entity-level rate: [PLACEHOLDER: state DOR cite] — Iowa's top individual rate was 8.53% in 2022 but has declined under recent tax reform; 2026 rate to be pinned.
Eligible entities: s-corp, partnership, llc-as-s, llc-as-partnership
Owner credit: refundable
Composite interaction: mandatory — Iowa § 422.16B mandates composite return filing (IA PTE-C) for nonresident members starting tax year 2022; PTET layered on top.
§199A QBI base reduction: Yes — Reduces federal flow-through income (Notice 2020-75).
Last verified: 2026-05-11

Source: tax.iowa.gov/pass-through-entity-tax + tax.iowa.gov/iowa-composite-returns-2022. Iowa's PTET sits ON TOP of a mandatory composite-return regime — unusual structure.

IRC §164(b)(6)Notice 2020-75 IRC §199A

Election walkthrough

Verify eligibility. Iowa accepts: s-corp, partnership, llc-as-s, llc-as-partnership. Publicly traded partnerships meeting Iowa Code § 422.16B(5)(a) reporting requirements excluded.
Check the deadline. [PLACEHOLDER: state DOR cite] — Iowa PTET election deadline to be pinned to tax.iowa.gov/pass-through-entity-tax. For tax year 2022, IDR extended the original election deadline (per tax.iowa.gov/idr-extends-2022-pass-through-entity-tax-election-deadline).
Compute the entity-level tax. Apply the 0.00% rate to qualified net income.
Pay and file. Use IA PTE-C (Composite Return) and PTET schedule. Quarterly estimates may be required.
Owners claim the state credit. refundable credit on the personal state return.
Verify composite interaction. Composite interaction: mandatory. See composite vs PTET.
Run the federal §199A QBI math. PTET reduces the QBI base proportionally; net the federal SALT-arbitrage against the §199A offset.

Iowa PTET — common questions

Annual deadline reminder

State PTET law revises annually. Iowa's data was last verified on 2026-05-11. Re-confirm with the state DOR primary source before electing or filing. Last full-site review: 2026-05-12.

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Election walkthrough

Verify eligibility. Iowa accepts: s-corp, partnership, llc-as-s, llc-as-partnership. Publicly traded partnerships meeting Iowa Code § 422.16B(5)(a) reporting requirements excluded.

Check the deadline. [PLACEHOLDER: state DOR cite] — Iowa PTET election deadline to be pinned to tax.iowa.gov/pass-through-entity-tax. For tax year 2022, IDR extended the original election deadline (per tax.iowa.gov/idr-extends-2022-pass-through-entity-tax-election-deadline).

Compute the entity-level tax. Apply the 0.00% rate to qualified net income.

Pay and file. Use IA PTE-C (Composite Return) and PTET schedule. Quarterly estimates may be required.

Owners claim the state credit. refundable credit on the personal state return.

Verify composite interaction. Composite interaction: mandatory. See composite vs PTET.

Run the federal §199A QBI math. PTET reduces the QBI base proportionally; net the federal SALT-arbitrage against the §199A offset.

Iowa PTET — common questions