Iowa Clarifies Use of Old Forms IA W-4

An update to instructions included with Iowa’s 2024 withholding formula clarifies that employers can convert the number of allowances used on the state’s withholding certificate to the new system of an allowance expressed in dollars.

The state’s initial guidance on the changes to the 2024 Form IA W-4, Employee Withholding Allowance Certificate, was that employees “should be encouraged” to fill out a new form, and that employers were to use an allowance of $40 with no additional withholding for employees who did not fill out the form.

The guidance now reads that employers that “expect to receive” new forms from ...