Exemptions & Credits

 

Iowa law provides for a number of credits and exemptions. It is the property owner's responsibility to apply for these as provided by law. It is also the property owner's responsibility to report to the Assessor when they are no longer eligible for any credit or exemption they have applied for. Following is a list of several credits and exemptions available in Iowa.

Homestead Tax Credit

To qualify for the credit, the property owner must be a resident of Iowa and occupy the property on July 1 and for at least six months of every year. A dwelling located on land owned by a Community Land Trust as defined in 42 U.S.C., Section 12773. New applications for homestead tax credit are to be filed with the Assessor on or before July 1 of the year the credit is first claimed. Once a person qualifies, the credit continues until the property is sold or until the owner no longer qualifies. This credit is equal to the tax on the first $4,850 of actual value for each homestead. (Refer Iowa Code, Chapter 425)

Disabled Veteran's Homestead Credit

Iowa residents who are an owner of a homestead property, and meet one of the following eligibility criteria are eligible for this credit which is equal to 100% of the actual tax levy.

1a. A veteran of any of the military forces of the United States, who acquired the homestead under 38 U.S.C. §21.801, 21.802, or 38 U.S.C. §2101, 2102.

1b. A veteran as defined in Section 35.1 with a permanent service-connected disability rating of 100%, or a permanent and total disability rating based on individual unemployability that is compensated at the 100% disability rate.

1c. A former member of the National Guard of any state who otherwise meets the service requirements of Iowa Code section 35.1, subsection 2, paragraph “b”, subsection (2) or (7), with a permanent service-connected disability rating of 100%, or a permanent and total disability rating based on individual unemployability that is compensated at the 100% disability rate.

1d. An individual who is a surviving spouse or a child who is receiving dependency and indemnity compensation (DIC) pursuant to 38 U.S.C. §1301 et seg.

To get this credit, the applicant needs to file an application with the Assessor on or before July 1 of the year the credit is first claimed, along with a DD214 and a current Benefits Paid letter issued within 12 months of the application date. Once the application is approved, reapplication for successive years is not required as long as the property is owned by someone who falls under one of the four categories of ‘owner’ listed in Iowa Code section 425.15, and used as a homestead by that person on July 1 of each of those successive years.

A surviving spouse of a veteran receiving the disabled veteran homestead tax credit also continues to receive the credit, as long as the spouse lives in the homestead and does not remarry.

Written notification must be provided to the assessor if the circumstances change which would result in a taxpayer being ineligible for the credit, or conveyance of this property, or its discontinued use as your homestead.

The Veteran who qualifies for the Disabled Veteran Homestead Tax Credit may not claim a military service tax exemption on any property located in Iowa.

Military Service Tax Exemption

Iowa residents who meet one of the following service requirements are eligible for the exemption:

  1. Honorably discharged veteran who served for a minimum aggregate of eighteen months.
  2. Honorably discharged veteran who served fewer than eighteen months because of a service related injury.
  3. Honorably discharged former member of Reserve Forces or Iowa National Guard who served at least 20 years.
  4. Member of Reserve Forces or Iowa National Guard who have served at least 20 years and continue to serve.
  5. Honorably discharged former member of the Armed Forces if any portion of their term of enlistment would have occurred within the Korean Conflict but who opted to serve 5 years in the reserve forces as allowed by Federal law.
  6. Honorably discharged veteran who served in an eligible service period (Iowa Code Chapter 35)

Application must be made with the Assessor on or before July 1 of the year the exemption is first claimed. The military certificate of satisfactory service, order transferring to inactive status, reserve, retirement, order of separation from service or honorable discharge must be recorded in the office of the county recorder. Members of the Reserve Forces or Iowa National Guard who have served at least 20 years and continue to serve shall record the veteran's retirement points accounting statement issued by the armed forces of the United States, the state adjutant general, or the adjutant general of any other state. The exemption from taxation is $2,778 for WWI veterans and $1,852 for all other service periods. If the qualified veteran does not claim the exemption the spouse, unmarried widow(er), minor child or widowed parent may be eligible to claim the exemption. (Refer to Iowa Code Chapter 426A)

Business Property Tax Credit

The Business Property Tax Credit (BPTC) is a credit against taxes based on valuation, for commercial, industrial, and railroad property. For BPTC applications received and approved by January 15, 2014, the credit will be applied to the 2013 assessment and therefore calculated as a credit on the Fall 2014 and Spring 2015 property tax statement. For all future years, the deadline for applying in the local assessor’s office is March 15th. *HF 616 passed in 2015 changed the filing date starting with the 2016 Assessment year and thereafter to July 1st of the same year.

Property owners may claim and receive one credit for each eligible parcel unless the parcel is a part of a property unit for which a credit is claimed. A property unit is defined in the law as “contiguous parcels all of which are located within the same county, with the same property tax classification, are owned by the same person, and operated by that person for a common use and purpose.” Eligible parcels, or property units, must be classified and taxed as commercial, industrial, or railroad property.

The law excluded properties which will be reclassified to the new multi-residential classification in 2015. These property types include: mobile home parks, manufactured home communities, land-leased communities, assisted living facilities (as defined in section 441.21, subsection 13, enacted in this law), and any property primarily used or intended for human habitation containing three or more separate dwelling units. Therefore, apartment buildings, dwellings converted to 3 or more apartments, and Section 42 Housing are excluded. Also excluded, are residential and agricultural properties that may have home businesses or are rental properties.

Family Farm Credit

This is a tax credit on agricultural tracts of land 10 acres or more that are farmed by the owner or designated family members (this includes spouse, parent, grandparent, great grandparent, child, grandchild, great grandchild, stepchild, brother, sister uncle, aunt, niece, nephew.) Applications are filed in the Assessor's Office.

Family Farm One-Time Filing

If a claim for the family farm credit is filed by November 1, and approved, further filing is not required provided the claimant owns the property on July 1 of subsequent years and the designated person actively engaged in farming the property remains the same. A claim filed after November 1 shall be considered as a claim filed for the following year.

If the ownership changes, the new owner must re-file for the credit and if the "designated person" changes, the owner must re-file for the credit.

The owner must notify the Assessor in writing of a change in the "designated person". Failure to do so will result in a penalty.

Contact the Assessor's office for more information on the complexities of this law. (Refer to Iowa Code Chapter 425A)

Other Credits and Exemptions

Following is a list of several other credits/exemptions administered by the Assessor's office. Filing is required on them as provided by Iowa law.

Exemption

File By

Filing Requirement

Code Section 

Family Farm

January - November 1

One Time -- Filed after November 1 is for following year.

425A.4

Barn & One-Room School

February 1

One Time

427.1(31) 427.1(32)

Exempt Property - Religious, Literary, Charitable*

February 1

One Time

427.1(14)

Forest Reservation

February 1

One Time

427C.3

Fruit Tree

February 1

One Time

427C.3

Historic Property

February 1

One Time

427.16

Impoundment Structure

February 1

Annual

427.1(20)

Indian Housing Authority

February 1

One Time

427.1(33)

Industrial Property Tax

February 1

One Time

427B.4

Low Rent Housing

February 1

One Time

427.1(14)

Methane Gas Conversion Property

February 1

One Time

427.1(29)

Mobile Home Park Shelter

February 1

One Time

427.1(30)

Natural Conservation or Wildlife Areas

February 1

Annual

427.1(22)

Native Prairie

February 1

Annual

427.1(23)

Pollution Control

February 1

One Time

427.1(19)

Recycling

February 1

One Time

427.1(19)

Speculative Shell Building

February 1

One Time

427.1(27)

Urban Revitalization

February 1

One Time

404.4

Wetlands

February 1

Annual

427.1(23)

Wildlife Habitat

February 1

One Time

427.1(24)

Business Property Tax Credit

Contact Assessor's Office

One Time

426C.3

Disabled Vet Homestead

July 1

One Time

425.2




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  1. Gary Vander Werf


    Assessor
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    Floyd County Courthouse
    101 S. Main St.
    Suite 207
    Charles City, IA 50616

    Ph: 641-257-6152

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