The top bracket of Iowa’s state income tax reaches 8.98 percent at $68,175 in 2014. The state phased out its tax on Social Security income in 2014. If you want to raise a toast in celebration, it’ll cost you: Iowa has some of the highest excise tax rates on table wine and spirits, according to the Tax Foundation and the Distilled Spirits Council of the United States.
A potential gas tax increase, intended to pay for transportation infrastructure, has been percolating in the Iowa Legislature this session, but nothing had passed as of mid-April.
Note: Spouse, lineal-ascendant and lineal-descendant transfer is tax-free; sibling or child-in-law transfer is taxed at 5 percent to 10 percent; all other transfers are taxed at 10 percent to 15 percent.