Disability income exclusion
You may exclude from Iowa tax a portion of the disability pay you received in 2018 if you meet ALL of the following conditions:
You received disability pay, and
You were not yet 65 when your tax year ended, and
You retired on disability and were totally and permanently disabled when you retired, and
On January 1, 2018 , you had not yet reached the age when your employer's retirement program would have required you to retire.
If you meet all of these conditions, obtain form IA 2440 (pdf). You MUST complete form IA 2440 to take this exclusion. A doctor's statement must accompany each year's return attesting to the taxpayer's complete and permanent disability.