Iowa Withholding Tax Booklet And Tax Tables - 2005 Page 2
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28Iowa Department of Revenue
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CHANGES FOR TAX YEAR 2005
Over the past several years, Federal individual income tax rates and brackets have changed. Both
Iowa and Federal tax brackets are indexed for inflation. This new withholding booklet is in
response to these changes and brings withholding calculation formulas and tablets up-to-date.
Changes are effective April 1, 2005.
Since the amount of withholding from wages will change, employees may want to revisit the
number of allowances they claim on their Iowa Employee Withholding Allowance Certificate
(IA W4).
1.
WITHHOLDING
Iowa law requires that employers deduct and withhold from the wages an amount that will
approximate the employee's annual tax liability on a calendar year basis. The amount withheld is
calculated using tables or formulas provided in this booklet. Withholding agents are required to
remit the greater of the amount withheld, or should have been withheld, during the liability
period, as determined by the withholding agent’s filing frequency requirement. Filing frequency
thresholds are outlined in Section 5. Note that all withholding payments are to be the amount
withheld during the liability period. The amount withheld, based on formula or actual, must be
remitted to the Iowa Department of Revenue. No estimation or approximations are
permitted. Special rules exist for withholding from pensions, gambling winnings, and
supplemental wage payments. These rules are outlined in Section 4.
2.
WHO MUST ACT AS A WITHHOLDING AGENT?
Every employer who maintains an office or transacts business in Iowa and who is required to
withhold Federal income tax on any compensation paid to employees for services performed in
Iowa is required to withhold Iowa individual income tax from that compensation.
Registering as a withholding agent
To register, complete the Iowa Business Tax Registration form. If you have not yet obtained a
Federal I.D. Number, enter "applied for" in the "Federal I.D. Number" blank. The Department
will issue a temporary identification number. Once you receive your Federal Identification
Number, it is your responsibility to notify the Department of that number so your file can
be updated. Register online at or obtain the Iowa Business Tax Registration
form (78-005).
by mail: Tax Forms
PO Box 10457
Des Moines IA 50306
by phone: 515/281-7239 or 1-800-532-1531 (Iowa only)
by automated fax: 1-800-572-3943 (enter 0078005 when asked for form number)
to order by e-mail:
iowataxforms@idrf.state.ia.us
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