Iowa just changed its biggest homeowner break. A law signed May 18, 2026 replaces the old homestead tax credit with a homestead exemption worth 10% of your home’s taxable value [1]. On top of it sit an extra break at 65, help for veterans, and a credit for low-income seniors and disabled owners [3][4][5][6].
At a glance
- Homestead exemption, from assessment year 2026
- 10% of taxable value, $5,500 to $20,000 [1]
- First tax bills affected
- September 2027 and March 2028 [1]
- Age 65 or older
- Another $6,500 of taxable value exempt [1][3]
- Homestead and military claims
- To your assessor by July 1 [2][9]
- Low-income senior and disabled credit
- To your county treasurer by June 1 [6][8]
The new 10% homestead exemption
Under Division 20 of SF 2472, every eligible homestead gets an exemption equal to 10% of its taxable value, with a minimum of $5,500 and a maximum of $20,000 [1]. Starting with assessment years on or after January 1, 2027, the Iowa Department of Revenue will adjust the maximum for inflation [1].
The change applies to assessment year 2026, so you’ll first see it on property taxes paid in September 2027 and March 2028 [1]. Before this, the homestead credit was worth the tax on the first $4,850 of a home’s value [1].
Who qualifies
To claim a homestead in Iowa, you have to [2]:
- Own the home (legally or under a contract) and use it as your homestead on July 1.
- Declare Iowa residency for income tax purposes.
- Live in it at least six months of the year.
How to apply
New owners file the Homestead Tax Exemption form (54-028) with their city or county assessor [1]. The claim is due July 1 of the year you’re first claiming it; a claim filed after July 1 counts for the following year [2]. Once allowed, it carries forward without refiling as long as you keep qualifying [2]. When a home is sold, the buyer has to file again [2].
The Department of Revenue says assessors can’t require documents the form doesn’t ask for, and can’t deny a claim just because you won’t hand over extra paperwork [1]. You do have to attest that what you report is true [1].
Another $6,500 at age 65
If you’re 65 or older on or before January 1 of the assessment year, you also get an exemption of $6,500 of taxable value on your homestead [1][3]. You claim it on the same homestead form, and once approved it carries forward without refiling [1].
Veterans
| Program | What it's worth | Who qualifies |
|---|---|---|
| Military service exemption | $4,000 of taxable value | Eligible honorably discharged or separated veterans, for assessment years from January 1, 2023 |
| Disabled veteran homestead credit | The entire tax on the homestead | Veterans with a permanent 100% service-connected rating, or a permanent and total rating based on individual unemployability; certain former National Guard members; surviving spouses and children receiving dependency and indemnity compensation |
- Military service exemption: For assessment years beginning on or after January 1, 2023, an eligible veteran’s property is exempt up to $4,000 of taxable value [4]. Iowa’s definition includes former members who served at least 18 months and were discharged under honorable conditions, or fewer than 18 months if honorably discharged because of a service-related injury [4]. A manufactured or mobile home counts as property [4].
- Disabled veteran credit: Veterans with a permanent 100% service-connected disability rating, or a permanent and total rating based on individual unemployability, get a credit for the entire tax levied on their homestead [5]. It can continue to an unmarried surviving spouse and children [5]. If you take this credit, you can’t also take other veteran property tax exemptions [5]. The new homestead exemption doesn’t end it [1].
County assessors list July 1 as the deadline to first claim the military exemption and the disabled veteran credit [9].
The credit for low-income seniors and disabled owners
Iowa’s Property Tax Credit is a separate program for homeowners with low incomes [6]. For the 2026 claim, you qualify if you’re an Iowa resident and one of these [6]:
- 65 or older on December 31, 2025, with total 2025 household income under $26,895.
- 70 or older on December 31, 2025, with household income under 250% of the federal poverty level. That’s $39,125 for one person and $52,875 for two [6].
- Totally disabled and 18 or older by December 31, 2025. You’ll need proof, such as a VA statement, a Social Security document or a doctor’s statement [6].
| 2025 household income | Share of the tax credited |
|---|---|
| $0 to $13,854.99 | 100% |
| $13,855 to $15,484.99 | 85% |
| $15,485 to $17,114.99 | 70% |
| $17,115 to $20,374.99 | 50% |
| $20,375 to $23,634.99 | 35% |
| $23,635 to $26,894.99 | 25% |
| $26,895 or more | No credit |
For claimants 65 to 69 and totally disabled claimants, the credit is figured on no more than $1,000 of property tax [7]. Married couples count as one household and file one claim with combined income [6].
File the claim with your county treasurer, not the Department of Revenue, between January 1 and June 1 [6][8]. For good cause, such as illness or absence, the treasurer can extend the deadline to March 31 of the following year [6][8].
Where to start
- Your city or county assessor: the homestead exemption, the 65-and-older exemption, the military exemption and the disabled veteran credit [2][9].
- Your county treasurer: the low-income Property Tax Credit [6].
- Iowa Department of Revenue: forms and guidance on the new homestead exemption [1].
Sources
- Iowa Department of Revenue: Homestead Tax Credit and Exemption
- Iowa Code § 425.2: Qualifying for credit
- Iowa Code § 425.1A: Homestead tax exemption (65 and older)
- Iowa Code § 426A.11: Military service exemptions
- Iowa Code § 425.15: Disabled veteran tax credit
- Iowa Department of Revenue, 2026 Iowa Property Tax Credit Claim and instructions (54-001)
- Iowa Code § 425.24: Maximum property tax for purpose of credit
- Iowa Code § 425.20: Filing dates, extension
- Marshall County Assessor: Credits and Exemptions
Next steps
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What is the Iowa homestead exemption for 2026?
A law signed May 18, 2026 (SF 2472) replaced the old homestead tax credit with an exemption of 10% of your homestead's taxable value, at least $5,500 and at most $20,000. It starts with assessment year 2026, which means property taxes paid in September 2027 and March 2028.
Do I have to reapply for the new Iowa homestead exemption?
Not if you already had the homestead credit or exemption before July 1, 2026 and still qualify. The Iowa Department of Revenue says those owners get the 10% exemption automatically. New owners file the Homestead Tax Exemption form (54-028) with their assessor.
Is there an Iowa property tax break for seniors?
Two. Owners 65 or older by January 1 of the assessment year get an extra homestead exemption of $6,500 of taxable value. Separately, low-income owners 65 or older, or totally disabled, can claim a property tax credit from their county treasurer by June 1; for the 2026 claim, owners 65 to 69 need 2025 household income under $26,895.
What property tax help do Iowa veterans get?
Eligible honorably discharged veterans can exempt $4,000 of taxable value. Veterans with a permanent 100% service-connected disability rating, or a total disability rating based on individual unemployability, get a credit for the entire tax on their homestead.