Final 2021 tax brackets, standard deductions released
The Iowa Department of Revenue this week released its finalized individual income tax brackets and standard income tax deduction amounts for the 2021 tax year. It also released the 2021 interest charged to those who don’t pay their taxes on time. According to a news release, the rate for overdue payments will be 6% annually, 0.5% monthly, and 0.016438% daily. The breakdown of tax brackets can be found in the release. According to the release, Iowa code lays out the procedures for calculating the interest rates. State law also provides for the indexing of individual income tax brackets and standard deduction amounts. Indexing is intended to protect taxpayers from paying more than they should solely because of inflation, the release states. The tax brackets, standard deduction amounts and interest rates apply to the 2021 tax year for taxes payable in 2022.