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.
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.
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.
12.9% Lower electricity rates than the national average-EIA, 2020
Iowa generates more electricity from wind than any other state. 58% statewide electricity generation is from wind-EIA, 2020
Iowa Corporate Income Tax: Iowa's corporate income tax laws offer significant advantages when compared to the corporate taxes of other states.
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.