Iowa Department of Revenue announces 2022 income tax brackets, deductions
(The Center Square) – Individual income tax standard deductions in 2022 are $2,210 for single taxpayers and $5,450 for married taxpayers filing jointly, the Iowa Department of Revenue announced Tuesday.
Married taxpayers filing separately will have an individual income tax standard deduction of $2,210.
Individual income tax brackets and standard deductions are determined each year through applying inflation factors or “indexing,” the prior year’s amounts, according to Iowa law (Iowa Code sections 422.9, 422.21., 422.4 and 422.5 details indexation of Iowa income tax brackets).
“Indexation is meant to protect taxpayers from paying higher income taxes solely as a result of inflation,” the department said in its guidance.
Tax year 2022 income tax brackets are as follows:
0.33% for taxable income between $0 and $1,743$5.75+.67% for taxable income between $1,743 and $3,486$17.43+2.25% for taxable income between $3,486 and $6,972$95.87+4.14% for taxable income between $6,972 and $15,687$456.67+5.63% for taxable income between $15,687 and $26,145$1,045.46+5.96% for taxable income between $26,145 and $34,860$1,564.87+6.25% for taxable income between $34,860 and $52,290$2,654.25+7.44% for taxable income between $52,290 and $78,435$4,599.44+8.53% for taxable income above $78,435
Beginning Jan. 1, interest rates for taxpayers with overdue payments will be 5% annually, 0.4% monthly, and 0.013699% daily because the prime rate averaged 3.25% over the past 12 months (October 2020 to September 2021), the department said in its guidance. The rate was 6% in 2021.
Under Iowa law (Iowa Code Section 421.7), the annual rate is equal to the average monthly prime rate of the past 12 months, rounded to the nearest whole percent (3%), plus two percentage points (5%), the guidance said. The monthly rate is the annual rate, divided by 12 and rounded to the nearest one-tenth of a percentage point. The daily rate is the annual rate divided by 365.
Disclaimer: This content is distributed by The Center Square
