Out of State Credit[NOTE]

All income an Iowa resident earns is taxable to Iowa to the same extent that it is taxable on the Federal return even if the income was earned in another state or foreign country. If another state or foreign country taxes that same income, then the Iowa resident may be able to claim a credit on this line. Out-of-State Tax Credit is computed on Form IA 130.

Nonresidents of Iowa cannot claim this credit.
Part-year residents of Iowa may claim this credit only if the income they earned during that part of the year that they were Iowa residents was also taxed by another state or country.
The state or foreign income tax imposed on your income is the tax shown on the income tax return you filed with that state or country. It is not the amount that was withheld from your wages.
An IA 130 form must be figured separately for each state or foreign country. The combined total of all credits cannot exceed the Iowa tax liability.

The tax imposed on your income is the tax shown on the income tax return you filed with that state or foreign country. Tax imposed is the tax calculated from the tax formula/tables on the other state/foreign countrys tax return, less any non-refundable credits. Do not reduce this figure by the tax withheld or estimated gax payment made to the other state/foreign country.

Note: The credit or portion of the credit must not exceed the amount of the Iowa tax imposed on the same income which was taxed by the other state or foreign country.

Shareholders of S corporations who have income from the corporation that was apportioned outside Iowa and not taxed by Iowa cannot claim an out-of-state credit on this income.

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