Iowa Capital Gain Deduction 41-160

Capital Gain Deduction 41-160
IA 100F Iowa Capital Gain Deduction - ESOP, 41-160
2023 IA 100F

Iowa Capital Gain Deduction – ESOP
tax.iowa.gov
Name(s):_____________________________________ Social Security Number: __________________
This form is only used for installment sales occurring prior to January 1, 2023.
Part I: Details of Sale
1. Did the sale occur prior to January 1, 2023?
No ☐ ....... Sale is not eligible for Iowa capital gain deduction. Stop.
Yes ☐ ....... Continue to Part I, line 2
2. Is the capital gain from an installment sale?
No ☐ ....... Sale is not eligible for Iowa capital gain deduction. Stop.
Yes ☐ ....... Enter the installment sale information:
a. Start date (mm/dd/yyyy): _________________
b. End date (mm/dd/yyyy): __________________
c. Total capital gain to be received by taxpayer over
the life of the installment sale .................................... $ ____________
d. Total capital gain deduction claimed in prior years .... $ ____________
e. Capital gain received by the taxpayer in the current tax year ............... $_____________
Part II: Sale of Employer Securities to a Qualified Iowa Employee Stock Ownership Plan (ESOP)
1. Name of Iowa corporation: _______________________________________________________
Note: A limited liability company (LLC) is not considered to be an Iowa corporation for the
purposes of this deduction.
2. Does the qualified Iowa ESOP own at least 30% of all outstanding employer securities issued by
the Iowa corporation?
No ☐ ...... Sale is not eligible for Iowa capital gain deduction. Stop.
Yes ☐ ...... Continue to Part III, line 1
Part III: Details of Property Sold
1. Were the employer securities sold Iowa corporation stock?
No ☐ ...... Sale is not eligible for Iowa capital gain deduction under sale of employer
securities to a qualified Iowa ESOP. Stop.
Yes ☐ ...... Continue to Part III, line 2
2. Are you the sole owner of the employer securities? Married filers, see instructions.
No ☐ ...... Continue to Part III, line 3
Yes ☐ ...... Enter 100% on Part III, line 3
3. Enter taxpayer’s ownership percentage of the total employer securities
sold to the nearest one tenth of one percent (for example 65.2%)............... 3. _____________ %
4. Provide all other owner name(s): ____________________________________________________
______________________________________________________________________________
5. Provide the name of the qualifying Iowa ESOP: ________________________________________
______________________________________________________________________________
6. Iowa capital gain deduction. Multiply Part I, line 2e by 50% (.5).
Enter the amount here and include on IA 1040 Schedule 1, line 16 ............ 6. $ ______________

41-160a (08/17/2023)

2023 IA 100F Instructions, page 1
Instructions for 2023 IA 100F – Iowa Capital Gain Deduction Sale of
Employer Securities to a Qualified Iowa ESOP
What’s New: The IA 100F should only be used
for installment sales occurring before January 1,
2023.
Under tax reform passed in 2018 and 2019, and
modified during the 2021 and 2022 legislative
sessions, the Iowa capital gain deduction is
repealed for most transactions occurring on or
after January 1, 2023. This repeal applies to all
sales except:
1. Certain sales of real property used in a
farming business
2. Sales of cattle or horses held for breeding,
draft, dairy, or sporting purposes by a
retired farmer who has sold all or
substantially all of their interest in the
farming business
3. Sales of breeding stock, other than cattle or
horses, by a retired farmer who has sold all
or substantially all of their interest in the
farming business
Deductions for previously eligible installment
sales will still be allowed if the sale occurred
prior to January 1, 2023.
The Iowa capital gain deduction is subject to
review by the Iowa Department of Revenue. The
Department will use this form to verify that the
taxpayer(s) qualifies for the deduction. The
Department may request additional information
if needed.
This completed form must be included with the
IA 1040 to support the Iowa capital gain
deduction claimed. Complete a separate IA
100F for each sale to a qualified Iowa ESOP.
Complete the form each year of a qualifying
installment sale, including all parts.
For taxpayers filing separately, each spouse
must complete an IA 100F for the Iowa capital
gain deduction claimed based on the spouse’s
ownership percentage in the employer
securities.
Flowcharts to assist in determining if a gain
qualifies are also available on the Department’s
website. For more information on the Iowa
capital gain deduction, see the instructions
below and Iowa Administrative Code rule 701—
302.38 (2022).

Part I: Details of Sale
Line 1: Check the box to indicate whether the
sale occurred prior to January 1, 2023.
Line 2: Check the box to indicate whether
capital gain comes from an installment sale. If
“Yes,” enter the date of the first installment, the
expected date of the final installment, the total
capital gain generated by the sale, the total
capital gain deduction claimed in prior years,
and the capital gain the taxpayer received
during tax year 2023. Do not include any interest
received.
Part II: Sale of Employer Securities to a
Qualified Iowa Employee Stock Ownership
Plan (ESOP)
Line 1: Enter the name of the Iowa corporation
whose employer securities the taxpayer sold.
Note: A limited liability company (LLC) is not
considered to be an Iowa corporation for the
purposes of this deduction. In addition, an Iowa
corporation is a corporation whose commercial
domicile is in Iowa.
Line 2: Check the box to indicate whether, upon
completion of the sale, the qualified Iowa ESOP
owned at least 30% of all outstanding employer
securities issued by the Iowa corporation
entered in Part II, line 1.
Part III: Details of Property Sold
Line 1: Check the box to indicate whether the
employer securities sold were Iowa corporation
stock.
Line 2: If married filing jointly and both spouses
are the only owners, check yes. If married filing
separately and both spouses are owners, check
no; each spouse must complete an IA 100F and
indicate on line 3 the separate ownership
percentage of that spouse.
Line 3: Enter the taxpayer’s ownership
percentage of the employer securities sold at
the time of the sale to the nearest one tenth of
one percent (for example: 50.0%; 33.3%). If not
the sole owner, the taxpayer’s ownership
percentage must be less than 100% and greater
than 0%.

41-160b (08/08/2023)

2023 IA 100F Instructions, page 2
Line 4: Enter the names of all persons and
entities that owned the employer securities at the
time of sale. If the capital gain flowed through to
the taxpayer from a partnership, S corporation,
LLC, estate, or trust, all owners of the entity must
be reported.
Line 5: Enter the name of the qualifying Iowa
ESOP.
Line 6: Enter the amount of the taxpayer’s
capital gain deduction claimed, 50% of Part I,
line 2e. Note that the deduction applies to the
net capital gain from a sale. Any nonrecaptured
losses are treated as ordinary income and are
not eligible for the Iowa capital gain deduction.
The eligibility of the Iowa capital gain deduction
reported here may be subject to further
examination by the Department.

41-160c (07/31/2023)