Iowa Makes Various State Tax Changes
On June 17, 2022, Iowa Gov. Kim Reynolds signed Senate File No. 2367 amending various sections of the state tax code. Diapers, feminine hygiene products, specified digital products, computer software, and services sold to public utilities will be exempt from sales tax starting January 1, 2023. There will be no more sales/use tax exemption for the sale and rental of computers by an insurance company, financial institution, or commercial enterprise effective January 1, 2024. The bill will also gradually reduce Iowa’s bank franchise tax from the current 5.0%. For 2027 and after it will remain at a fixed 3.5%.
Illinois Releases Changes to 2021 Business Income Tax Returns
The Illinois Department of Revenue released a bulletin detailing changes to IL business income tax returns and schedules for tax year 2021. The following changes are outlined in the release: (1) The IL net loss deduction for corporations, excluding S Corps, is limited to $100,000 for tax years ending on or after December 31, 2021 and before December 31, 2021. (2) For any net loss that has not expired as of November 16, 2021, the carryover period is extended from 12 to 20 years, and the carryover period for tax years ending on or after December 31, 2021 has now become 20 years. (3) IL decouples from federal 100% bonus depreciation, thus on Form IL-4562, the taxpayer should include the amount of federal depreciation they would have claimed on their federal return without any regard to bonus depreciation.
January 17, 2022