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SF 379

A bill for an act creating a deduction available against the individual income tax for educational expenses at institutions of higher education for career-related programs and apprenticeship programs, and including retroactive applicability provisions.

2025-2026 Regular Session

SF 379 lets Iowa taxpayers deduct career-related higher-ed costs not earning a college credit and apprenticeship costs (Code 84D) from personal income tax, retroactive to 2025.

Subcommittee recommends passage.
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Bill Summary · SF 379

Summary of SF 379 — Deduction for Educational Expenses Related to Career Programs and Apprenticeships (Retroactive)

Overview

SF 379 proposes a personal income tax deduction for certain education-related expenses incurred by individuals. The deduction would apply to educational costs at institutions of higher education for career-related programs and to participation in registered apprenticeship programs. The bill includes retroactive applicability to tax years beginning on or after January 1, 2025.

Purpose and intent

  • Create a tax deduction to help individuals offset costs of career-focused education and apprenticeship training.
  • Encourage participation in career and Technical Education (CTE) pathways and registered apprenticeship programs.

What the bill would do

  • Allow a deduction against individual income tax for:
    • Expenses for instruction at institutions of higher education for career-related programs that do not qualify for a college credit credential/credit qualification.
    • Expenses related to participation in a registered apprenticeship program (registered with the Iowa Office of Apprenticeship under Code 84D).
  • The bill defines key terms to establish what qualifies as an “institution of higher education,” “expenses,” and “payment” (definitions are included in the bill, but not all details are provided in the summary text provided here).
  • Applies retroactively to tax years beginning on or after January 1, 2025.

Key provisions and definitions (highlights)

  • Eligibility categories:
    • Career-related programs at institutions of higher education not qualifying for college credit.
    • Apprenticeship program participation registered with the Iowa Office of Apprenticeship (Code 84D).
  • The terms “institution of higher education,” “expenses,” and “payment” are defined in the bill to guide eligible deductions.
  • Specific deduction amount, caps, phase-outs, or interaction with other education credits/deductions are not disclosed in the provided summary and would be in the full bill text.

Affected parties

  • Individual income taxpayers incurring eligible education expenses.
  • Institutions of higher education offering eligible career-related programs.
  • Registered apprenticeship programs and the Iowa Office of Apprenticeship (Code 84D) that would be referenced by the bill’s criteria.
  • The state tax system and related administrative offices would handle the deduction under current tax filing processes.

Implementation timeline and status

  • Introduced: February 19, 2025.
  • Referred to the Ways and Means committee.
  • Subcommittee actions:
    • February 2025: Subcommittee appointed (Dickey, Green, Townsend).
    • March 12, 2025: Subcommittee recommended passage.
    • March 11–12, 2025: Subcommittee meeting held.
  • Legislative progress: Subcommittee recommends passage, indicating a favorable step toward a full committee vote.

Potential impact and considerations

  • Financial impact depends on the deduction amount, eligible expense levels, and taxpayer uptake. The current summary does not provide dollar caps or phase-out details.
  • If enacted, the deduction could influence decisions about pursuing career-related education and registering/apprenticeship programs, as well as how individuals plan educational expenditures.
  • Retroactive applicability means taxpayers with qualifying expenses in 2025 and later years could potentially claim the deduction when filing.

Next steps for readers

  • Monitor future committee actions and the full bill text for specifics on deduction amounts, caps, eligibility limits, and any coordination with other education-related tax benefits.
  • Consider how a deduction interacts with existing credits or deductions for education when evaluating personal tax planning.

Compiled from official sources — confirm details with the bill’s official record.

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