Tax reform, E-15 mandates, part of new 2023 Iowa laws

Published: Jan. 2, 2023 at 10:59 PM CST
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DAVENPORT, Iowa (KWQC) - About 11 new laws took place in Iowa, Sunday to start the new year.

Most new laws take effect in July after the Iowa General Assembly’s regular session in the first part of the year. However, some laws can be written to start at different times.

For instance, in June the general assembly passed changes to the “Bottle Bill.”

Grocery and convenience stores are no longer required to accept returned bottles. Bottle return facilities will also now collect a three-cent fee up from one cent. There is no change to the five-cent return for consumers.

There are also changes coming to income taxes, however, many Iowans won’t notice a change until 2024, when filing their taxes for 2023.

A set of laws signed by Governor Kim Reynolds in March of 2022 will eliminate taxes on retirement income starting this year. It also gets the ball rolling on a plan to make Iowa’s income tax a flat three-point nine percent by 2026.

Starting this year there will be four tax brackets, down from nine in 2022. Non-married taxpayers’ income under $6,000 will be taxed at 4.4%. Next, anything from $6,001 to $30,000 is taxed at 4.82%.

Then, income from $30,001 to $75,000 is taxed at 5.7%. Finally, anything earned over $75,001 will be taxed at 6%.

In every following year, the highest tax bracket will be eliminated, until 2026, when the flat tax is officially implemented.

Finally, the Iowa legislature also passed a new law that requires a majority of gas stations to carry E-15 fuel.

Small gas stations that sold less than 300,000 gallons from January 2020 through December 2022, can apply for an exemption.

In Illinois, almost 190 new laws went into effect Sunday, ranging from a new state rock to most parts of the controversial SAFE-T Act.