Targeted Jobs Withholding Tax Credit
Funds workforce growth in selected Iowa cities through payroll-withholding allocations matched by participating municipalities.
Iowa's Targeted Jobs Withholding Tax Credit is a pilot program administered by the Iowa Economic Development Authority (IEDA) that allows employers in five designated cities to redirect up to 3% of gross employee wages quarterly into a dedicated project budget, with the designated city providing matching funds. The program is capped at a maximum agreement term of 10 years per project. Eligible cities are Burlington, Council Bluffs, Fort Madison, Keokuk, and Sioux City — no other Iowa locations qualify.
To be eligible, a business must satisfy one of three criteria: relocate to Iowa from another state and create jobs at or above the city's hourly wage threshold; be an existing Iowa business creating or retaining 10 or more new jobs at or above that threshold; or be an existing Iowa business making a qualifying investment of at least $500,000 within a pilot city. FY 2026 wage thresholds (effective July 1, 2025) are $25.16/hour in Des Moines County (Burlington), $28.09/hour in Lee County (Fort Madison/Keokuk), $27.23/hour in Pottawattamie County (Council Bluffs), and $26.40/hour in Woodbury County (Sioux City).
The application process begins with the Pre-Application Project Questionnaire (IPQ); upon review, invited businesses submit the full Application for Financial Assistance. Because the withheld amounts are redirected to the project budget rather than remitted to the state, the program effectively delivers working capital to qualifying projects. Contacts are Alaina Santizo (alaina.santizo@iowaeda.com, 515.348.6162) and Maicie Pohlman (maicie.pohlman@iowaeda.com, 515.348.6161) at IEDA.
Allows employers in five designated Iowa cities to redirect up to 3% of gross employee wage withholding quarterly to a project budget, matched by the city, to support job creation and business investment.
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