TIN ComplianceA resource from TIN Comply
Backup withholding
No
Nonresident payments
Yes, 5%
Threshold
$1,000
Forms
44-095, 44-017
State withholding

Iowa backup withholding and nonresident contractor withholding

Iowa withholds on nonresidents, not on TIN problems. Iowa Code 422.16(2)(c) ties non-wage withholding to IRC 3402(o), (p), (s) and 3405 payments to residents and never mentions 3406, so federal backup withholding has no Iowa counterpart. Iowa Code 422.16(2)(b) and rule 701-307.4 require withholding on Iowa-source income paid to nonresidents that is not wages: fees for personal services performed in Iowa, payments to nonresident entertainers (but not entertainment corporations), rents, royalties and income from temporary businesses such as construction contracts. The rule says 5 percent of the payment; the Department’s Form 44-017, which a nonresident files to be released from withholding, computes the alternative estimated payment at 3.8 percent. Both figures are shown with their sources.

State backup withholding not requiredNonresident non-wage withholding requiredSources checked November 1, 2026Updated November 1, 2026
In this guide
  1. Status
  2. Withholding on non-wage payments to nonresidents
  3. What Iowa does not require
  4. Pass-through entity withholding
  5. From the source
  6. What to confirm
  7. Sources

Status

State backup withholdingNot required

Primary source (statute, regulation or agency publication saved in full)

Non-wage payments to nonresidentsRequired

Primary source (statute, regulation or agency publication saved in full); regulation via Cornell LII mirror; statute and IDR pages direct

Federal backup withholding under IRC 3406 (24 percent on a missing or mismatched TIN) applies in Iowa exactly as everywhere else; this page covers only what the state adds. The 50-state tables put Iowa next to its neighbours, and the Iowa 1099 filing page covers whether the state wants its own copy of the 1099.

Withholding on non-wage payments to nonresidents

Applies to
Nonresidents (individuals and entities) receiving Iowa-source income not subject to wage withholding: fees for personal services performed in Iowa (attorneys, physicians, engineers, accountants, consultants), compensation to nonresident actors, singers, performers, entertainers and wrestlers (but not entertainment corporations per IDR), rents and royalties from Iowa property, income from temporary businesses such as construction contracts, agricultural commodity payments (with an optional exemption).
Threshold
None stated; a nonresident whose Iowa net income is $1,000 or less is tax-exempt and the payer is released
Rate
5% of the payment (Iowa Admin. Code 701-307.4(1)(b)); IDR release form computes the estimated payment alternative at the 3.8% individual rate
Statute
Iowa Code 422.16(2)(b); Iowa Admin. Code r. 701-307.4 (Withholding on nonresidents); 422.17 (certificate of release)
Withholding return
Reported on the payer's Iowa withholding return (Form 44-095 quarterly) and annual VSP reconciliation
Exemption certificate or waiver
Form 44-017 (Nonresident Claim for Release from Withholding) filed by the payee with an IA 1040ES payment; IDR issues a release letter to the payer; agricultural payment listing exemption (701-307.4(6)); film/TV production employer exemption
Payee statement
Federal Form 1099 showing Iowa withholding
Due dates
Same as the payer's withholding deposit schedule; 44-017 must be filed before the income is paid
Exceptions
Payee holds an IDR release certificate; payee is tax-exempt (net Iowa income $1,000 or less); agricultural commodity sales reported on the IDR listing; income reported on a composite return under 422.16B; Illinois residents' wages (reciprocity, wages only); interstate carrier employees

What Iowa does not require

State backup withholding

No state backup withholding: Iowa Code 422.16(2)(c) ties nonwage withholding to IRC 3402(o), (p), (s) and 3405 payments to Iowa residents; 3406 is not referenced; interest and dividends are not subject to Iowa withholding

Basis: Primary source (statute, regulation or agency publication saved in full).

Pass-through entity withholding (out of scope)

For tax years from 2022 Iowa requires composite returns (422.16B) instead of withholding for nonresident owners. Entity-level withholding on distributions to nonresident owners is a duty of the entity, not of a payer, and is not covered on this page.

From the source

“Iowa income tax should be withheld at a rate of 5 percent of the amount of the payment”

Iowa Admin. Code r. 701-307.4(1), text via Cornell LII, read November 1, 2026

“a payment equal to 3.8% of Line 3 below”

Iowa Form 44-017, Nonresident Claim for Release from Withholding, read November 1, 2026

“Compensation paid to entertainers performing in Iowa, but not payments to entertainment corporations”

Iowa Department of Revenue, Iowa Withholding Tax Information, read November 1, 2026

What to confirm

  • Two figures appear in the Department’s own materials: rule 701-307.4 says 5 percent of the payment, and Form 44-017 (the release form the nonresident files) computes the alternative estimated payment at the 3.8 percent individual rate. The rule governs the withholding the payer makes; the form governs the payment the payee makes instead. Confirm with the Department which figure it expects on a given payment type.
  • The rule text was read from Cornell LII; the statute and the Department pages were retrieved directly.

Sources

Each source below was read and saved on November 1, 2026; the page is built from the saved text. Statutes are cited to the section; department pages and publications to their title and, where shown, revision date.

Related guides