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1390XD

Department of Revenue, Omnibus Tax (1390XD) - Revenue, Department of

2025-2026 Regular Session

Bill 1390XD streamlines Iowa's tax laws, enhancing compliance and efficiency, while allowing law enforcement access to taxpayer info for tax evasion investigations.

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Bill Summary · 1390XD

Summary of Bill 1390XD: Department of Revenue, Omnibus Tax

Bill Number: 1390XD
Title: Department of Revenue, Omnibus Tax
Introduced: November 19, 2025
Status: Proposed Bill

Purpose and Intent

The Omnibus Tax Bill (1390XD) aims to implement a series of technical changes to Iowa's tax laws as administered by the Department of Revenue. The bill seeks to streamline tax administration, enhance compliance, and clarify existing tax provisions. It includes both refiled provisions from previous legislation and new proposals intended to improve the efficiency of tax processes.

Key Provisions

Division I: Disclosure of Tax Information

  • Expanded Disclosure: The Department can now share confidential taxpayer information with law enforcement if there is evidence of willful failure to file or other criminal offenses related to tax evasion.
  • Effective Date: Upon enactment.

Division II: Annual Reporting

  • Elimination of Annual Report Requirement: The bill proposes to remove the requirement for the Department to submit an annual report on taxpayer noncompliance, while still allowing for recommendations to be made as needed.

Division III: Property Tax Changes

  • Late Claims: The Department will no longer accept late property tax credit claims, although claimants can still file with county treasurers under certain conditions.
  • Statute of Limitations: Clarifies that a two-year statute of limitations applies to appeals made to the Department director regarding property tax assessments.
  • Effective Date: Upon enactment.

Division IV: Farm Tenancy Income Tax Exclusion

  • Clarification of Eligibility: The definition of "held" for property ownership and the requirement for material participation in farming are clarified to ensure consistency in tax exclusions for retired farmers.

Division V: Pass-Through Entities

  • Appeal Limitations: The bill clarifies that limitations on appealing estimated tax assessments also apply to pass-through entities, retroactively effective from January 1, 2024.

Division VI: Sales Tax Changes

  • Simplification of Tax Scenarios: The bill rewrites sections of the sales tax code to improve clarity regarding tax obligations for contractors and building owners.
  • Adjustment of Reporting Frequency: Changes the reporting frequency for direct pay permit holders from semimonthly to monthly.

Division VII: Motor Fuel Taxes

  • Recalculation of Fuel Tax Rates: Allows the Department to adjust fuel tax rates based on reporting errors or inaccuracies.

Impact

The proposed changes will affect various stakeholders, including:
- Taxpayers: Changes in reporting requirements and the ability to claim certain tax credits may impact individual and business taxpayers.
- Department of Revenue: The bill aims to streamline operations and enhance compliance measures.
- Law Enforcement: Expanded access to taxpayer information may assist in investigations related to tax evasion.

Procedural Aspects

  • Effective Dates: Many provisions are set to take effect immediately upon enactment, emphasizing the urgency of the changes.
  • Retroactive Applicability: Certain provisions, particularly those affecting pass-through entities, will apply retroactively to January 1, 2024.

This summary provides an overview of the essential elements of Bill 1390XD, highlighting its purpose, key provisions, and potential impacts on taxpayers and the Department of Revenue.

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

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