Iowa - Tuition and Textbook Tax Credit

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Iowa – Tuition and Textbook Tax Credit

Iowa – Tuition and Textbook Tax Credit

The Iowa Tuition and Textbook Tax Credit program was enacted and launched in 1987, and it allows parents to receive a limited tax credit for their educational expenses. Learn more about the program’s details on this page, including eligibility, funding, regulations and more.

Program Fast Facts

  • One of four state tax credit programs for educational expenses nationwide

  • 116,707 participating taxpayers (2017)

  • 100 percent of taxpaying families with children eligible statewide

  • Average tax credit amount: $131 (2017)

  • Value as a percentage of public school per-student spending: 1 percent

Program Details

Iowa’s Tuition and Textbook Tax Credit Participation

Tax Returns Claiming Credit
Tax Year

Click the + symbols to learn more about this program’s details.

Iowa provides parents of students in any private or public school a tax credit covering educational expenses, including tuition, books and lab or activity fees. The credit is worth a maximum of $250.

Tax Credit Value

Parents receive a tax credit worth 25 percent of their expenditures up to a maximum credit of $250 per dependent in school. To get the maximum $250 per-dependent credit, parents must spend $1,000 in educational expenses. They also must have a state tax liability of at least $250 because the credit is nonrefundable and, thus, cannot reduce an individual’s tax burden to less than zero.

Student Eligibility

All households with students enrolled in accredited nonprofit public or private elementary or secondary schools in Iowa are eligible.

EdChoice Expert Feedback

Iowa’s individual tax credit provides universal eligibility, a positive attribute in any school choice program. However, the $250 credit is very small compared to the costs of private school tuition and covers only 25 percent of expenditures. To increase the opportunities for choice, the Iowa program could mirror the Alabama tax credit program by increasing the size and value of the credit and making the credit refundable for low-income families. That would increase the funding power of the program and more closely align student funding with the per-pupil spending in Iowa’s public schools.

Rules and Regulations

  • Income Limit: None
  • Prior Year Public School Requirement: None
  • Geographic Limit: Statewide
  • Enrollment Cap: None
  • Individual Credit Cap: $250
  • Testing Mandates: None


Parent Requirements:

  • Must spend at least $1,000 in educational expenses, including tuition and textbooks, for each dependent attending an accredited or approved nonprofit elementary or secondary school
  • Must have a state tax liability of at least $250

Governing Statutes

Iowa Code § 422.12

Legal History

On March 17, 1992, the U.S. District court for the Southern District of Iowa held that Iowa’s newly enacted Tuition and Textbook Tax Credit program was constitutional. Citing a previous ruling, Mueller v. Allen, 463 U.S. 388, 103 S. Ct. 3062, 77 L. Ed. 2d 721, 1983 U.S. 96, upholding Minnesota’s Education Tax Deduction, the court ruled that Iowa’s tax credit for private school educational expenses does not violate the Establishment Clause of the First Amendment to the United States Constitution. Luthens v. Bair, 788 F. Supp. 1032 (S.D. Iowa 1992).

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