Iowa 2025 Tax Rate. Since the enactment of iowa senate file 2442 in may 2024, iowa law provides for a flat tax rate of 3.8 percent for all levels of taxable individual income beginning with tax year. In 2025, iowa’s individual income tax will drop to a 3.8% single tax rate due to recently signed legislation.
Iowa no longer taxes retirement income for taxpayers 55 or older. The annual rate, as per iowa code section.