Iowa Homestead Exemption: 2026 Amount, Deadline and How to Apply

Iowa's homestead exemption takes 10% off the taxable value of an owner-occupied home, with a minimum of $5,500 and a maximum of $20,000 of taxable value for assessment year 2026. It replaced the old homestead tax credit starting with assessment year 2026 under 2026 Senate File 2472, which amended Iowa Code 425.1A. You claim it once on Form 54-028 with your city or county assessor by July 1 of the year you first claim it, and it carries over in later years. For other states, see our guide to homestead exemptions by state.

Information last verified on 2026-10-07. This article has not been reviewed by a licensed lawyer.

Jurisdiction scope: This article covers Iowa's homestead property tax exemption (Iowa Code chapter 425, subchapter I, as amended by 2026 Senate File 2472), the additional exemption for owners 65 and older, the military service exemption (Iowa Code 426A.11), the disabled veteran homestead credit, the creditor homestead (Iowa Code chapter 561) and Iowa's bankruptcy opt-out (Iowa Code 627.10). It does not cover the exact workings of Iowa's residential assessment limitation, the amounts of the income-tested credit in chapter 425, subchapter II, business or agricultural property, or other states' programs.

How Iowa's homestead exemption changed in 2026

Until assessment year 2026, Iowa gave homeowners a homestead tax credit. Senate File 2472, signed May 18, 2026 and applying retroactively to assessment year 2026, replaced it. The Iowa Department of Revenue explains: "Beginning with assessment year 2026, Division XX of that bill replaces the homestead tax credit with an exemption."

The old credit is no longer allowed for assessment year 2026 and later, except for one group. The bill says that for assessment year 2026 and each year after, "unless eligible under paragraph "b", a claim for the homestead credit under this paragraph "c" shall not be allowed." Paragraph "b" is the disabled veteran credit described below.

Because property taxes in Iowa are paid in the year after the assessment, the change reaches bills later than you might expect. The Department of Revenue's Form 54-028 says a claim filed by July 1, 2026 "will apply to the taxable value for assessment year 2026 and taxes due and payable in September of 2027 and March 2028."

How much the Iowa homestead exemption is

The new exemption is a share of your home's taxable value, with a floor and a ceiling. Iowa Code 425.1A, as amended by Senate File 2472, provides:

"For the assessment year beginning January 1, 2026, and each assessment year thereafter, an exemption from taxation of ten percent of the taxable value, but not less than an exemption of five thousand five hundred dollars in taxable value and not to exceed an exemption of twenty thousand dollars in taxable value, shall be allowed on each eligible homestead."

The $20,000 ceiling is adjusted for inflation starting with assessment year 2027, using the income tax inflation factor, and the Department of Revenue determines the cumulative factor each year. Iowa Code 425.1A, as amended by Senate File 2472, provides: "The annual adjustment factor for the assessment year beginning January 1, 2026, is one hundred percent." So the maximum is $20,000 for assessment year 2026; check with the Department of Revenue for the figure that applies to later years.

The exemption reduces taxable value, not the tax itself. The Department of Revenue explains: "An exemption is a reduction in the value of the property that a taxpayer pays taxes on. A credit is a direct reduction of the tax amount." How much tax that saves depends on your local levy rates, so this page does not estimate a dollar saving.

The order of the reductions matters when you hold more than one. The Department of Revenue says the new exemption "should be applied after the application of assessment limitations, but before the $6,500 homestead exemption applicable to homestead owners over the age of 65 and the military service exemption."

Who is eligible for the Iowa homestead exemption

The exemption is for an owner who lives in the home. Iowa Code 425.11, as amended by Senate File 2472, defines the homestead as including "the dwelling house which the owner, in good faith, is occupying as a home on July 1 of the year for which the credit or exemption is claimed and occupies as a home for at least six months during the calendar year in which the fiscal year begins."

That means two tests in the same year: you must be living there on July 1, and you must live there for at least six months of that calendar year. The exemption covers the dwelling and the land that goes with it as a home, not other buildings or land you own.

How and when to apply

Form. Use Form 54-028, Homestead Tax Exemption, issued by the Iowa Department of Revenue under "Iowa Code chapter 425 and Iowa Administrative Code rule 701--110.1." The current form also asks you to certify that the home has a smoke detector and, where required, a carbon monoxide alarm.

Where. File with your city or county assessor, not with the state. Form 54-028 notes: "Contact information for all assessors can be found at the Iowa State Association of Assessors website: iowa-assessors.org." The county board of supervisors allows or disallows the claim after the assessor's recommendation, under Iowa Code 425.3.

Deadline. Form 54-028 states: "This application must be filed or postmarked to your city or county assessor on or before July 1 of the year in which the exemption is first claimed." The form adds: "A claim filed after July 1 of the year for which the person is claiming exemption shall be considered a claim filed for the following year."

Renewal. You do not refile each year while you own and live in the home. Iowa Code 425.2, as amended by Senate File 2472, says that once allowed, "the claim shall be allowed on that homestead for successive years without further filing" as long as you or your spouse own and use it as a homestead on July 1 each year, you declare Iowa residency for income tax purposes, and you or your spouse occupy it at least six months of the year. When the home is sold or transferred, the new owner has to file a new Form 54-028; a spouse who keeps the home in a divorce property division under Iowa Code chapter 598 does not have to refile.

If you already had the old credit. You do not need to file again because of the switch. Senate File 2472 provides that owners "who have filed for or that are receiving homestead credits or exemptions under chapter 425, subchapter I, before the effective date of this division of this Act shall continue to receive such credits and exemptions for which the owner is eligible for assessment years beginning on or after January 1, 2026, without refiling." That carryover applies only to owners who already had a claim on file. Anyone claiming for the first time, including a recent buyer, must file by July 1.

Assessment limits and moving to a new home

Iowa taxes a home on only a percentage of its assessed value, called the assessment limitation (or rollback), which the Department of Revenue certifies each year under Iowa Code 441.21. For assessment year 2025 it was 44.5345% for residential property. It is a statewide percentage, not a cap on how much your own home's value can rise, and the homestead exemption comes off the value after that percentage is applied. Your assessor can explain how it applies to your property.

We found no rule that lets you carry the homestead exemption or an assessment benefit to a new home. You file a new Form 54-028 for the new home by July 1. The disabled veteran credit is different: Senate File 2472 says that "If an owner acquires a different homestead, the credit allowed under this paragraph may be claimed on the new homestead unless the owner fails to meet the other requirements of this paragraph."

Extra relief for seniors and veterans

Owners 65 and older

An owner who "has attained the age of sixty-five years by January 1 of the assessment year" gets an additional exemption under Iowa Code 425.1A. Senate File 2472 sets the amount, for "the assessment year years beginning on or after January 1, 2024, and each succeeding assessment year," at an amount "not to exceed six thousand five hundred dollars in taxable value." (The doubled wording is as printed in the bill.)

You claim it on the same Form 54-028, which says: "Claimants aged 65 years or older are eligible for an additional exemption of 6,500 of taxable value." Like the main exemption, it continues in later years without refiling.

Military service exemption

Iowa Code 426A.11 exempts property, "not to exceed four thousand dollars in taxable value for the assessment years beginning on or after January 1, 2023, of an honorably separated, retired, furloughed to a reserve, placed on inactive status, or discharged veteran." For this purpose, "veteran" also means "a resident of this state who is a former member of the armed forces of the United States and who served for a minimum aggregate of eighteen months," along with the other veterans the statute describes.

To claim it, first record your discharge or separation papers (such as a DD-214) with the county recorder, then file Form 54-146, Military Service Property Tax Exemption, with your city or county assessor by July 1 (Iowa Code 426A.13). Once allowed, it continues without refiling while you or your spouse own the property on July 1 of each year. It cannot be combined with the disabled veteran credit described below.

Disabled veteran homestead credit

For qualifying disabled veterans, Iowa keeps a homestead credit that wipes out the whole tax on the homestead. Senate File 2472 provides that "the homestead credit allowed on the homestead shall be the entire amount of tax levied on the homestead."

It is available to a veteran with a permanent 100% service-connected disability rating, or a permanent and total rating based on individual unemployability paid at the 100% rate, as certified by the U.S. Department of Veterans Affairs. A veteran who acquired the home under the VA specially adapted housing program (38 U.S.C. 2101 or 2102, or the earlier provisions before August 6, 1991) also qualifies. Certain former National Guard members and a surviving spouse or child receiving dependency and indemnity compensation (DIC) can also claim it, and it can continue for the unmarried surviving spouse or children of a deceased owner. A DIC recipient stays eligible while DIC continues; the Department of Revenue notes that a surviving spouse who receives DIC "is eligible for the credit even upon remarriage."

Two limits apply. First, for applications filed on or after July 1, 2026, the homestead for this credit "shall not include appurtenances and shall not exceed one-half acre." Owners who applied before July 1, 2026 keep the earlier definition. Second, it cannot be combined with other veteran property tax breaks: an owner who takes it "is not eligible for the credit provided in paragraph "c" or any other real property tax credit or exemption provided by law for veterans of military service."

To claim it, file Form 54-049, Disabled Veteran Homestead Property Tax Credit, with a DD-214 and a VA Benefits Paid letter issued within the last 12 months. The application states: "You must submit the Homestead Tax Exemption (54-028) form with this application. This application must be filed with your city or county assessor by July 1 of the assessment year."

Income-tested credit for older and disabled homeowners

Iowa Code chapter 425, subchapter II, contains a separate, income-tested property tax credit. Its claimant definitions in Iowa Code 425.17 cover owners aged 65 to 69 or totally disabled, and owners 70 or older with a household income of "less than two hundred fifty percent of the federal poverty level."

This credit is claimed on Form 54-001 with your county treasurer, not the assessor, between January 1 and June 1 (Iowa Code 425.20). The Department of Revenue says a claimant aged 70 or older "must continue to file for the credit each year in order to receive the maximum benefit of the new credit calculation." The credit amount follows an income schedule that changes each year; the treasurer or the Department of Revenue can confirm the current figures.

Losing the exemption and penalties for wrongful claims

The exemption ends when the property is no longer your homestead, for example when you move out or rent it. Iowa Code 425.2 requires the owner to tell the assessor in writing by July 1 after the change in use (the Department of Revenue's Notice of Transfer or Change in Use of Property, Form 59-458, is used for this). If the exemption is disallowed and you did not give that notice, Iowa Code 425.7 assesses "a civil penalty equal to five percent of the amount of the disallowed exemption or credit." If the Department of Revenue disallows a claim and the disallowance is not appealed, or is upheld on appeal, the amounts allowed plus any penalty become a lien on the property while the claimant still owns it and are collected like other property taxes.

A false claim is treated more seriously. Iowa Code 425.7 provides: "If a person makes a false claim or affidavit with fraudulent intent to obtain the homestead exemption or credit, the person is guilty of a fraudulent practice and the claim shall be disallowed in full."

The creditor homestead: a different law

Iowa's protection of a home from creditors comes from Iowa Code chapter 561, not from the property tax exemption. Filing Form 54-028 has nothing to do with it, and the tax exemption's dollar figures do not apply to it.

Iowa Code 561.16 states: "The homestead of every person is exempt from judicial sale where there is no special declaration of statute to the contrary." There is no dollar cap on the equity it covers. Instead, Iowa Code 561.2 limits its size: "If within a city plat, it must not exceed one-half acre in extent, otherwise it must not contain in the aggregate more than forty acres."

You do not need to record anything for the protection to apply. Under Iowa Code 561.4, an owner may mark out and record the homestead, "but a failure to do so shall not render the same liable when it otherwise would not be, and a selection by the owner shall control."

The protection has exceptions. Iowa Code 561.21 lists debts the homestead may be sold to satisfy, including debts contracted before you acquired it, debts under a written contract that expressly makes the homestead liable, and debts "secured by a mechanic's lien under chapter 572." We did not separately verify how child support or tax liens are treated.

Iowa has opted out of the federal bankruptcy exemptions. Iowa Code 627.10 provides that a debtor to whom Iowa law applies "is not entitled to elect to exempt from property of the bankruptcy estate the property that is specified in 11 U.S.C. 522(d) (1979)." For how the homestead works in a bankruptcy case, see our guide to Iowa bankruptcy.

Homestead rights in probate

Iowa has no fixed-dollar homestead allowance in probate. Under Iowa Code 633.374, the court can set off property "as it deems reasonable for the proper support of the surviving spouse for the period of twelve months following the death of the decedent." Separately, in an intestate estate, or where the surviving spouse has filed an election, the surviving spouse may elect a life estate in the homestead in place of the spouse's share in the decedent's real property, under Iowa Code 633.240. The election must be entered of record, and failing to make it waives the right.

For estates generally, see our guide to Iowa probate.

Where to get help

The Iowa Department of Revenue's homestead tax credit and exemption page has the current forms and guidance. Your city or county assessor accepts Form 54-028 and can confirm whether a claim is on file for your home. To look up the assessor's record for your parcel, see our guide to Iowa property records.

Related

• Homestead exemptions by state
• Iowa bankruptcy
• Iowa probate
• Iowa property records

Disclaimer: This article provides general legal information about Iowa's homestead property tax exemption and related credits under Iowa Code chapters 425 and 426A (as amended by 2026 Senate File 2472) and the creditor homestead under Iowa Code chapter 561, verified as of October 7, 2026. It is not tax or legal advice. For your situation, contact your city or county assessor, the Iowa Department of Revenue, or a lawyer licensed in Iowa.

Last updated: 2026-10-07.

Frequently Asked Questions

How much is the homestead exemption in Iowa?

For assessment year 2026, it is 10% of the home's taxable value, but not less than $5,500 and not more than $20,000 of taxable value, under Iowa Code 425.1A as amended by Senate File 2472. The maximum is adjusted for inflation starting with assessment year 2027; the statute sets the adjustment factor for assessment year 2026 at 100%.

When is the deadline to file for homestead exemption in Iowa?

File Form 54-028 with your city or county assessor, or have it postmarked, on or before July 1 of the year you first claim it. A claim filed after July 1 is treated as a claim for the following year.

Do I have to reapply for homestead exemption every year in Iowa?

No. Iowa Code 425.2, as amended by Senate File 2472, allows the claim for successive years without further filing while you or your spouse own and use the home as a homestead on July 1, you declare Iowa residency for income tax purposes, and you or your spouse occupy it at least six months of the year. A new owner must file after a sale or transfer.

I had the old Iowa homestead credit. Do I need to file again for the new exemption?

No. Senate File 2472 says owners who filed for or were receiving homestead credits or exemptions before the change keep receiving those they are eligible for, starting with assessment year 2026, without refiling.

Is there an extra homestead exemption for seniors in Iowa?

Yes. An owner who has turned 65 by January 1 of the assessment year gets an additional exemption of $6,500 of taxable value (assessment years 2024 and later), claimed on the same Form 54-028.

Do disabled veterans pay property tax on their homestead in Iowa?

A veteran with a permanent 100% service-connected VA rating, or a permanent and total rating based on individual unemployability paid at the 100% rate, can claim a credit equal to the entire tax levied on the homestead, as can a surviving spouse or child receiving DIC. File Form 54-049, with Form 54-028, a DD-214 and a VA Benefits Paid letter issued within the last 12 months, with your city or county assessor by July 1 of the assessment year.

Does the Iowa homestead exemption protect my house from creditors?

The tax exemption does not. A separate law, Iowa Code 561.16, exempts a homestead from judicial sale with no dollar cap, limited by size under 561.2, but 561.21 lists debts it does not protect against, such as debts contracted before you acquired the home and mechanic's liens.