This bill modifies the state income tax withholding requirements for winnings derived from slot machines in Iowa. Currently, state income tax is withheld on winnings exceeding $1,200; however, the bill removes this threshold and stipulates that state income tax will only be withheld if the winnings are required to be reported on an information return for federal tax purposes. This change aligns the state tax withholding process with federal reporting requirements, simplifying the process for both players and tax authorities.

Additionally, the bill maintains existing withholding requirements for other gambling activities, such as winnings over $600 from certain gambling activities and over $1,000 from others, including sports wagering. The bill is deemed of immediate importance and will take effect upon enactment.

Statutes affected:
Introduced: 422.16