The Homestead Exemption in Iowa

Beginning with assessment year 2026, Iowa's homestead tax credit (formerly equal to the taxes on $4,850 of value) is replaced by a homestead exemption of 10% of the homestead's taxable value, with a minimum of $5,500 and a maximum of $20,000 of taxable value; from assessment year 2027 the maximum is adjusted for inflation. The change (Division 20 of 2026 Iowa Acts, SF 2472, signed May 18, 2026) first affects taxes paid in September 2027 and March 2028. The owner must declare Iowa residency for income tax purposes and occupy the home in good faith on July 1 and for at least six months of the year (or be in a nursing home, care facility or hospital with the home not rented, or on active military duty).

File Form 54-028 (Homestead Tax Exemption) with your city or county assessor. Once allowed, the exemption continues in later years without refiling as long as you qualify; people who had the homestead credit or exemption before July 1, 2026 automatically receive the new 10% exemption if still eligible. Notify the assessor in writing if you sell the property or stop using it as your homestead.

The application must be filed or postmarked to the city or county assessor on or before July 1 of the year the exemption is first claimed; a claim filed after July 1 is treated as a claim for the following year. A claim filed by July 1, 2026 applies to assessment year 2026 (taxes payable September 2027 and March 2028).