A bill for an act modifying the individual and alternate income tax rates, and including applicability provisions.

This Iowa bill (HF 496) lowers the state's individual income tax rates for 2026 and beyond. It reduces the standard tax rate from 3.8% to 2.5% on taxable income, and lowers the alternate tax rate from 4.3% to 3.0% for higher-income filers. The changes apply to all Iowa residents and nonresidents with taxable income, affecting most individual income tax returns filed for tax years beginning January 1, 2026. The bill modifies existing tax calculation methods but does not change filing requirements or exemptions.