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Iowa Free Printable IA 128 Iowa Research Activities Tax Credit, 41-128 for 2019 Iowa Iowa Alternative Simplified Research Activities Credit 41-124

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Iowa Alternative Simplified Research Activities Credit 41-124
IA 128 Iowa Research Activities Tax Credit, 41-128

2018 IA 128 Iowa Research Activities Tax Credit https://tax.iowa.gov Name(s) ________________________________________________ SSN or FEIN _______________ Industry in Which Researching Entity is Engaged (see instructions) _____________________________ Pass-Through Entity (if applicable) ______________________________________________________ Pass-Through FEIN ___________________________ Tax Period Ending Date _________________ PART I – Calculation of U.S. Qualified Research Expenses 1. Did the researching entity claim the federal research credit for this same tax year? Yes ☐ ...... Continue to Part I, line 2 (if pass-through only, continue to Part II, line 32). No ☐ ....... Taxpayer is not eligible for the Iowa Research Activities Tax Credit. Stop. 2. Certain amounts paid or incurred to energy consortia ............................................ 2. _____________ 3. Basic research payments to qualified organizations ............................................... 3. _____________ 4. Qualified organization base period amount ............................................................. 4. _____________ 5. Wages for qualified research services .................................................................... 5. _____________ 6. Cost of supplies used in conducting qualified research .......................................... 6. _____________ 7. Rental or lease costs of computers used in conducting qualified research............. 7. _____________ 8. Applicable portion of contract research expenses................................................... 8. _____________ 9. Total qualified research expenses. Add lines 5 through 8....................................... 9. _____________0 10. Fixed-base percentage to four decimals, but not more than 16.00% .................... 10. ___________ % 11. Average U.S. annual gross receipts for tax years 2014 through 2017 .................. 11. ____________ 12. Multiply line 11 by the percentage on line 10 ........................................................ 12. ____________ 13. Subtract line 12 from line 9. If zero or less, enter zero .......................................... 13. ____________ 14. Multiply line 9 by 50% (0.5) ................................................................................... 14. ____________ 15. Enter the smaller of line 13 or line 14 .................................................................... 15. ____________ 16. Total allowable U.S. qualified research expenses. Add lines 2 and 15 ................. 16. ____________0 PART II – Calculation of Tax Credit Based on Percentage of Research Occurring within Iowa 17. Basic research payments to qualified organizations in Iowa ............................. 17. _____________ 18. Iowa apportioned qualified organization base period amount ........................... 18. _____________ 19. Subtract line 18 from line 17. If zero or less, enter zero .................................... 19. _____________ 20. Multiply line 19 by 6.5% (0.065) ....................................................................... 20. _____________0 21. Wages for qualified research services performed in Iowa ................................. 21. _____________ 22. Cost of supplies used in conducting qualified research in Iowa ........................ 22. _____________ 23. Rental or lease costs of computers used in conducting qualified research in Iowa ............................................................................................................... 23. _____________ 24. Applicable portion of contract research expenses incurred in Iowa ................... 24. _____________ 25. Total Iowa qualified research expenses. Add lines 21 through 24..................... 25. _____________0 26. Total U.S. qualified research expenses. Add lines 2 and 9 ............................... 26. _____________0 27. Iowa share of research. Divide line 25 by line 26, enter percentage to four decimals (ex. 72.18%) ....................................................................................... 27. ____________ % 28. Expenses allocable to Iowa. Multiply line 16 by the percentage on line 27 ....... 28. _____________ 29. Multiply line 28 by 6.5% (0.065) ........................................................................ 29. _____________0 41-128a (08/22/18) 2018 IA 128, page 2 30. Iowa Research Activities Tax Credit. Add lines 20 and 29. 0 Enter in column K of Part II on the IA 148 Tax Credits Schedule ........................... 30. ______________ 31. Supplemental Research Activities Tax Credit. See instructions. Enter in column K of Part II on the IA 148 and include the tax credit certificate number in column J .. 31. ______________ 32. Pass-through Iowa Research Activities Tax Credit received from partnership, LLC, S corporation, estate, or trust. Enter on Part II and Part IV of the IA 148....... 32. ______________ 33. Pass-through Supplemental Research Activities Tax Credit received from partnership, LLC, S corporation, estate, or trust. Enter on Part II and Part IV of the IA 148 and include the tax credit certificate number ..................................... 33. ______________ IA 148 Tax Credits Schedule must be completed. 41-128b (08/22/18) 2018 IA 128 Research Activities Tax Credit Instructions Form IA 128 is used if the taxpayer elects to claim the regular Research Activities Tax Credit. Form IA 128S is used only if the taxpayer elects to claim the Alternative Simplified Research Activities Tax Credit. The taxpayer may elect to use this method regardless of the method used in computing the federal research tax credit. The taxpayer is not required to use this method in computing the Research Activities Tax Credit for subsequent years. Research expenses qualified for the Iowa Research Activities Tax Credit are based on the rules governing the federal research tax credit, see Section 41 of the Internal Revenue Code (IRC). An individual may only claim the Iowa tax credit if the entity conducting the research also claims and is allowed the federal research credit and is engaged in an eligible industry in Iowa. The Iowa credit equals 6.5% of increased research expenses plus 6.5% of increased basic research expenses in Iowa. Any tax credit in excess of tax liability can be refunded or credited to tax liability for the following year. Industry in Which Researching Entity is Engaged You must report the industry in which the business conducting the research is engaged. An individual may only claim the Iowa tax credit if the business conducting the qualified research is engaged in manufacturing, life sciences, software engineering, or the aviation and aerospace industry. For definitions of these industries, please see IAC 701.42.11. Ineligible businesses include, but are not limited to, those engaged in agricultural production, an agricultural cooperative, a finance or investment company, a retailer, a wholesaler, a publisher, a transportation company, a real estate company, a collection agency, an accountant, an architect, a contractor, a subcontractor, or a builder, or a business that engages in commercial and residential repair and installation including but not limited to heating or cooling installation and repair, plumbing and pipe fitting, security system installation, and electrical installation and repair. Innovative Renewable Energy Generation Under the High Quality Jobs Program taxpayers may be awarded a Research Activities Tax Credit for the development and deployment costs of innovative renewable energy generation components manufactured or assembled in Iowa. This cannot include components with more than 200 megawatts of installed effective nameplate capacity. These costs are not eligible for the federal research tax credit. A separate form IA 128 must be completed to account for these costs, which can be included on lines 4 and 20 of the separate form. The amount of the additional tax credit relating to these costs is not eligible for the Supplemental Research Activities Tax Credit. Example: An eligible business with gross receipts of $20 million or less earns an Iowa Research Activities Tax Credit of $50,000, excluding any costs relating to innovative renewable energy generation components. The business is allowed a supplemental credit of $76,923, which would result in an Iowa tax credit of $126,923. The Iowa tax credit relating to innovative renewable energy generation components is $25,000. This can be added to the regular and supplemental tax credit, resulting in a total Iowa Research Activities Tax Credit of $151,923. Trades or Businesses under Common Control For a group of trades or businesses under common control (whether or not incorporated), the Iowa Research Activities Tax Credit is calculated as if all the organizations are one trade or business. The tax credit calculated for the group must be shared among the members on the basis of each member’s proportionate contribution to the increase in research expenses. Adjustments for Certain Acquisitions and Dispositions If a major portion of a trade or business is acquired or disposed of, adjustments must be made to research expenses for the period before or after the acquisition or disposition. Short Tax Year For any short tax year, qualified research expenses are annualized. Apportionment of T a x Credit The tax credit calculated on lines 2 through 30 by a partnership, LLC, S corporation, estate, or trust is apportioned to the members. The passthrough entity must file the IA 128 with its return. 41-128c (08/22/18) 2018 IA 128 Instructions, page 4 On Schedule K-1 or on an attachment to Schedule K-1, report the tax credit for each member and instruct the members to complete line 1 and report the apportioned tax credit on line 32 of form IA 128 and include it with their tax returns. If the taxpayer earns a tax credit by conducting research and is a member of a business that has passed through a tax credit to the taxpayer, calculate the tax credit on form IA 128, lines 2 through 30. Also enter the pass-through tax credit on line 32. Report each separately on the IA 148 Tax Credits Schedule. Supplemental Research Activities Tax Credit Businesses with tax incentive contracts under the High Quality Jobs Program or the Enterprise Zone Program can be awarded a Supplemental Research Activities Tax Credit by the Iowa Economic Development Authority (IEDA). The total eligible supplemental tax credit claim is provided in the contract along with the tax credit certificate number. The maximum supplemental tax credit cannot exceed 10% of the sum of lines 19 and 28 for businesses with annual gross receipts of $20 million or less (as reported on line 10). The maximum supplemental tax credit cannot exceed 3% of the sum of lines 19 and 28 for businesses with annual gross receipts exceeding $20 million. If the Supplemental Research Activities Tax Credit is earned by a pass-through entity, report the supplemental tax credit separately on Schedule K-1 and provide the tax credit certificate number. Instruct members to report their tax credit on line 33 of form IA 128 and include it with their tax returns. 2018 IA 128 Line Instructions Provide your name, SSN or FEIN, tax period ending date, and industry. Line 1: Claim to federal research credit Iowa law requires that the researching entity must claim and be allowed the Federal Credit for Increasing Research Activities under IRC section 41 for the same taxable year in order for the entity to be eligible to claim the Iowa credit. Even if this is true, the researching entity must also meet the industry requirements under Iowa law noted above (see Industry in Which Researching Entity is Engaged). Lines 2 through 8: U.S. qualified research expenses Enter amounts from the Federal Credit for Increasing Research Activities, federal form 6765. Lines 2-4 are the same as federal lines 13; lines 5-8 equal federal lines 5-8. Line 10: Fixed-base percentage Use the same fixed-base percentage calculated for the federal research tax credit, rounding to four decimal places (1/100th of 1%), not to exceed 16.00%. Line 11: U.S. annual gross receipts Enter the average U.S. annual gross receipts for the four tax years preceding the tax year for which the tax credit is being determined. For any short year you may be required to annualize gross receipts. See IRC sections 41(c)(1)(B) and 41(f)(4) for details. Use this value to determine the calculation of the Supplemental Research Activities Tax Credit, if applicable. Line 17: Iowa basic research payments Corporations other than S corporations, personal holding companies, service organizations, LLCs, and partnerships, enter cash payments, pursuant to a written contract, made to a qualified university or scientific research organization in Iowa for basic research. See IRC section 41(e) for details. Line 18: Iowa base period amount Enter the qualified organization base period amount based on minimum basic research amounts for the preceding three years, see IRC section 41(e) for details. For purposes of apportionment, multiply the amount on line 3 by the amount on line 16 divided by the amount on line 2. Line 21: Iowa expenses on research wages Enter any wages paid to an employee for qualified research services performed in Iowa. Line 22: Iowa expenses on research supplies Enter the amounts paid or incurred for supplies used to conduct qualified research in Iowa. Line 23: Iowa research expenses on computers Enter the amount paid or incurred to another person for the right to use computers to conduct qualified research in Iowa. This entry must be reduced by any amount received or accrued from any other person for the right to use substantially identical personal property. 41-128d (08/22/18) Line 24: Iowa contract research expenses Include 65% of qualified research performed on your behalf in Iowa. Use 75% for payments made to a qualified research consortium and 100% for payments made for qualified energy research performed by an eligible small business, university, or federal laboratory. Include payments to those same entities to the extent they are included as basic research payments on line 17, not to exceed the base period amount on line 18, subject to the 65% or 75% limitation. Line 30: Research Activities Tax Credit Individuals and C corporations must enter this amount on the IA 148 Tax Credits Schedule in column K of Part II; use tax credit code 58 in column I and leave column J blank. Line 31: Supplemental Research Activities Tax Credit Individuals and C corporations must enter this amount on the IA 148 Tax Credits Schedule in column K of Part II; use tax credit code 59 in column I and report in column J the tax credit certificate number from the tax credit certificate issued by IEDA. Line 32: Pass-through Research Activities Tax Credit If the taxpayer has received any pass-through Research Activities Tax Credit from a partnership, LLC, S corporation, estate, or trust, indicate that amount on this line. Also enter this amount in column K of Part II on the IA 148 Tax Credits Schedule; use tax credit code 58 in column I and leave column J blank. Provide the pass-through name in column M and Federal Employer Identification Number (FEIN) in column N of Part IV on the IA 148 as well as on the top of this form. File a separate IA 128 for each pass-through Research Activities Tax Credit received. Also list the claims separately on Part II of the IA 148 Tax Credits Schedule, providing each pass-through name and FEIN in Part IV. 2018 IA 128 Instructions, page 5 Line 33: Pass-through Supplemental Research Activities Tax Credit If the taxpayer has received any pass-through Supplemental Research Activities Credit from a partnership, LLC, S corporation, estate, or trust, indicate that amount on this line. Also enter this amount in column K of Part II on the IA 148 Tax Credits Schedule; use tax credit code 59 in column I. Include the tax credit certificate number reported on Schedule K-1 in column J, and provide the pass-through name in column M and FEIN in column N of Part IV on the IA 148. File a separate IA 128 for each pass-through Supplemental Research Activities Tax Credit received. Also list the claims separately on Part II of the IA 148 Tax Credits Schedule, providing each pass-through name and FEIN in Part IV. Include this form, the Federal 6765, and the IA 148 with your IA 1040, IA 1041 or IA 1120. 41-128e (08/22/18)
Extracted from PDF file 2018-iowa-form-ia-128s.pdf, last modified June 2018

More about the Iowa Form IA 128S Corporate Income Tax Tax Credit TY 2018

We last updated the Iowa Alternative Simplified Research Activities Credit 41-124 in February 2019, so this is the latest version of Form IA 128S, fully updated for tax year 2018. You can download or print current or past-year PDFs of Form IA 128S directly from TaxFormFinder. You can print other Iowa tax forms here.

Other Iowa Corporate Income Tax Forms:

TaxFormFinder has an additional 43 Iowa income tax forms that you may need, plus all federal income tax forms.

Form Code Form Name
Form IA 130 Out-of-State Tax Credit 41-130
Form IA 1041 Fiduciary Return 63-001
Form IA 1041 Instructions Fiduciary Tax Return Instructions 63-002
Form IA 1065 Iowa Partnership Return of Income 41-016
Form IA 1120 Iowa Corporation Income Tax Return

Download all IA tax forms View all 44 Iowa Income Tax Forms


Form Sources:

Iowa usually releases forms for the current tax year between January and April. We last updated Iowa Form IA 128S from the Department of Revenue in February 2019.

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Form IA 128S is an Iowa Corporate Income Tax form. States often have dozens of even hundreds of various tax credits, which, unlike deductions, provide a dollar-for-dollar reduction of tax liability. Some common tax credits apply to many taxpayers, while others only apply to extremely specific situations. In most cases, you will have to provide evidence to show that you are eligible for the tax credit, and calculate the amount of the credit to which you are entitled.

About the Corporate Income Tax

The IRS and most states require corporations to file an income tax return, with the exact filing requirements depending on the type of company.

Sole proprietorships or disregarded entities like LLCs are filed on Schedule C (or the state equivalent) of the owner's personal income tax return, flow-through entities like S Corporations or Partnerships are generally required to file an informational return equivilent to the IRS Form 1120S or Form 1065, and full corporations must file the equivalent of federal Form 1120 (and, unlike flow-through corporations, are often subject to a corporate tax liability).

Additional forms are available for a wide variety of specific entities and transactions including fiduciaries, nonprofits, and companies involved in other specific types of business.

Historical Past-Year Versions of Iowa Form IA 128S

We have a total of eight past-year versions of Form IA 128S in the TaxFormFinder archives, including for the previous tax year. Download past year versions of this tax form as PDFs here:


2018 Form IA 128S

IA 128 Iowa Research Activities Tax Credit, 41-128

2017 Form IA 128S

IA 128S Alternative Simplified Research Activities Tax Credit, 41-124

2016 Form IA 128S

IA 128S Alternative Simplified Research Activities Tax Credit, 41-124

Iowa Alternative Simplified Research Activities Credit 41-124 2015 Form IA 128S

IA 128S Alternative Simplified Research Activities Tax Credit, 41-124

Iowa Alternative Simplified Research Activities Credit 41-124 2014 Form IA 128S

41150 (IA 135).pmd

Alternate Simplified Research Activities Credit 41-124 2013 Form IA 128S

41124 (IA 128S).pmd

2012 Form IA 128S

41124 (IA 128S).pmd

2011 Form IA 128S

41124 (IA 128S).pmd


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