Why is IA Form 1040C produced in my return?
The IA 1040C is a Composite Individual Income tax return for nonresident partners, shareholders, members or beneficiaries. The IA 1040C is produced if the nonresident member has enough income to create a positive tax.
- The minimum income requirement is met when the taxpayers Iowa source income is reduced by the standard deduction, tax is calculated, the exemption credit is subtracted from the calculated tax, and the Iowa tax due is still greater than $0.00.
Note: Per the Iowa 1040C instructions, "Nonresident Partners, Shareholders, or members enclose a copy of the Iowa Schedule K-1. Nonresident Beneficiaries enclose a copy of the federal Schedule K-1."
For further instruction, please see the Iowa 1040C instructions.