Iowa Tax Advantages
Iowa currently had the lowest cost of doing business, and offers businesses distinct operational advantages. These programs and others create a positive and profitable business environment, making Iowa the smart choice for your business.
Iowa Corporate Income Tax
A number of features of Iowa's corporate income tax offer significant advantages when compared to other states' corporate taxes.
- Fifty percent 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.
- Iowa corporate income tax may be reduced or eliminated by state tax credit programs.
Property and Sales or Use Tax
- No personal property tax for corporate inventories of goods-in-process, raw materials or salable goods.
- No property tax on industrial machinery, equipment or computers.
- No sales or use tax on purchases of industrial machinery, equipment and computers used for manufacturing or to process data by insurance companies, financial institutions or certain commercial enterprises.
- No sales tax on materials used in the manufacturing process or purchases of electricity or natural gas, propane or water used directly in the manufacturing process.
Refundable Research and Development Tax Credit
The credit offers up to 6.5 percent of the company's qualifying research expenditures in Iowa.
Iowa Business Advantages
Iowa is a Right-to-Work State
Under Iowa law an employee may not be required to join a union or pay dues or fees to any labor union, association or organization as a condition of employment.
Workers' Compensation Cost
Iowa's workers' compensation costs are among the lowest in the nation. The average cost of workers' compensation insurance for manufacturers in Iowa is 11% lower than the national average.
The Regulatory Assistance Program enhances the range of services available to Iowa companies by advising and assisting companies in the preparation and submission of permit application with the Iowa Department of Natural Resources (DNR) and other Iowa regulatory agencies. The mission of the Regulatory Assistance Program is to facilitate communication between the business and regulators and to expedite the permitting process.
Local Financial Incentive Programs
Utility Partner Incentive Program
Our local Municipal Utility and Rural Electric Cooperative partners work with us to offer low-interest loans for qualified applicants and have access to USDA Rural Economic Development Loan and Grant Program (REDL&G) zero interest funds.
Tax Increment Financing
If your business is located in one of the designated urban renewal areas or tax increment financing areas, it may be eligible for an economic development grant that uses the incremental taxes the project will generate.
Industrial Revenue Bonds
The City has the ability to issue bonds for some economic development projects. Such bonds are normally issued at a lower rate of interest than otherwise available to the business.
Dollars Per Job Financial Incentive Program
The New Hampton Economic Development has the ability to provide financial assistance to companies that create new employment opportunities and/or retain existing jobs and make new capital investment in New Hampton. The amount of funding is based, in part, on the number of jobs to be created/retained. Funds are provided in the form of loans and forgivable loans.