Why Iowa?

Workforce

New Jobs Incentives
Iowa’s training incentives and excellent educational institutions make it ideal for a business location. Iowa offers an array of financial assistance programs to make starting a business in Iowa easier. Funds may be awarded as a forgivable loan, low- or no-interest loan, or principal or interest buydown on a loan. Here's a general overview of what's available.

High-Quality Jobs Creation Program
Provides qualifying businesses tax credits to offset the cost incurred to locate, expand, or modernize an Iowa facility. To qualify for this very flexible assistance package that includes tax credits, exemptions and/or refunds, a business must be a non-retail or non-service business and meet wage requirements.
Iowa New Jobs Training Program
The Iowa Industrial New Jobs Training (260E) program assists businesses creating new positions with new employee training. If a company is expanding operations, or locating a new facility in the state, the program can provide flexible funding to meet the wide variety of training and employee development needs for its new employees. Examples of fund use include screening and assessment, travel for training purposes, in-plant instruction, costs of training facilities, equipment, and supplies, etc. The program is paid for by the new employees' withholding taxes at no cost to the employee or the company. These taxes may be diverted for a 10-year period to pay for upfront training costs.
Iowa New Jobs Tax Credit
Businesses entering into an agreement under the state's training program and increasing their workforce by at least 10% qualify for this credit to their Iowa corporate income tax. The credit is equal to 6% of the state unemployment insurance taxable wage base. The credit for 2021 is $1,944 per employee. The tax credit can be carried forward up to 10 years.

Iowa is a Right-to-Work State
Under Iowa law, an employee must not be required to join a union or pay dues or fees to any labor union, association, or organization as a condition of employment.

Iowa has one of the lowest new employer unemployment insurance tax rates in the nation. The 2021 standard new employer rate for all non-construction businesses for a three-year period is 1 percent on $32,400 maximum taxable earnings.
Iowa's comparative workers' compensation costs continue to rank among the nation's lower cost states.

Infrastructure

Rail & Road Improvements
Funding for rail and road improvements is available through the Iowa Department of Transportation. Local communities may offer incentives for infrastructure improvements.

Electric
12.9% Lower electricity rates than the national average-EIA, 2020

Renewable Energy
Iowa generates more electricity from wind than any other state. 58% statewide electricity generation is from wind-EIA, 2020

Costs

Iowa Corporate Income Tax: Iowa's corporate income tax laws offer significant advantages when compared to the corporate taxes of other states.

50% deductibility of federal taxes from Iowa corporate income tax.
Single-factor, non-unitary tax. Iowa's tax is based only on the percentage of total sales income within the state. Thus, if a business has no sales in Iowa, it pays no Iowa corporate income tax.
Iowa corporate income tax may be reduced or eliminated by the New Jobs Tax Credit.

New Jobs Tax Credit
Businesses entering into an agreement under the state's training program and increasing their workforce by at least 10% qualify for this credit to their Iowa corporate income tax. The credit is equal to 6% of the state unemployment insurance taxable wage base. The credit for 2021 is $1,944 per employee. The tax credit can be carried forward up to 10 years.

Research & Development Tax Credit
A refundable credit for increasing research activities is up to 6.5% of the company’s allotted share of qualifying research expenditures in Iowa. A company must meet the qualifications of the federal research activities credit and be engaged in the manufacturing, life sciences, software engineering or aviation and aerospace industry to be eligible for the credit on the Iowa return. Companies approved for expansion under the High-Quality Jobs program may be eligible for the tax credit to be increased for qualifying research and development activities.

No Sales & Use Tax on Property and Equipment
The purchase of industrial machinery, equipment, and computers used in manufacturing or the processing of data by insurance companies, financial institutions or certain commercial enterprises is exempt from Iowa sales or use tax. No sales tax is due on purchases of electricity or natural gas used in the manufacturing process.

No Property Tax on Industrial Machinery & Equipment
There is no property tax on industrial machinery, equipment, and computers. Pollution control equipment is eligible for exemption from property tax. An application must be filed for exemption.

Iowa’s Top Ten Manufactured or Value-Added Exports

Rankings