Bonus Depreciation

The Iowa Legislature in 2003 did not adopt the bonus depreciation provision of the federal Job Creation and Worker Assistance Act of 2002 reflected in section 168(k) of the Internal Revenue Code. Therefore, the additional changes made in the Jobs and Growth Tax Relief Reconciliation Act of 2003 which increased bonus depreciation from 30% to 50% for assets purchased after May 5, 2003, but before January 1, 2005, will also not be allowed on Iowa returns. Use form IA4562A to account for the difference between federal and Iowa depreciation.

Small Business Expensing

Iowa is planning to adopt the provisions of the federal Jobs and Growth Tax Relief Reconciliation Act of 2003 which relates to increasing the expensing amount under Section 179 of the Internal Revenue Code from $25,000 to $100,000 for assets placed in service during 2003, 2004 and 2005.

Posted 6/24/03
Iowa Department of Revenue