Live in Georgia, Work in Iowa: Which State Taxes Your Paycheck?
Answer
Both states tax the same wages, and a credit undoes the overlap. Iowa withholds as your work state and you file a Iowa nonresident return; Georgia taxes residents on all income, so you also file at home and claim the credit for tax paid to Iowa. File Iowa first.
Last verified
Without an agreement between Georgia and Iowa, the overlap is handled after the fact rather than prevented. That is why the filing order matters: the Iowa figure is an input to the Georgia return, so completing Georgia first means doing it twice.
A Georgia resident taxed by another state on the same income claims the credit for taxes paid to other states on Form 500 Schedule 2. The credit is capped at the Georgia tax on that income, so it removes the double tax but never refunds the excess when the other state charges more.
Iowa also has a layer below the state one, and it is the layer that survives every agreement: Many Iowa school districts levy a surtax calculated as a percentage of state income tax. It is reported on the state return rather than separately.
What you file
- 1Nonresident return · IowaForm IA 1040 with Schedule IA 126
File the Iowa nonresident return FIRST — you need the Iowa tax figure before you can complete Georgia.
- 2Resident return · GeorgiaForm 500 Schedule 2
File a Georgia resident return reporting all income, then claim the credit for tax paid to Iowa. The credit is capped at what Georgia would have charged on that same income, so if Iowa taxes it at a higher rate the difference is not refunded.
The two states, side by side
| Georgia | Iowa | |
|---|---|---|
| Taxes wages | Yes — flat | Yes — flat |
| Reciprocity partners | None | 1 (Form 44-016) |
| Convenience rule | No | No |
| Nonresident return | Form 500 with Schedule 3 | Form IA 1040 with Schedule IA 126 |
| Credit for other-state tax | Form 500 Schedule 2 | Form IA 130 |
| Nonresident safe harbour | None published | None published |
| Local income tax | No | Yes |
| Revenue department | Georgia Department of Revenue | Iowa Department of Revenue |
| Last verified |
The other direction
Reversing the commute does not always reverse the answer. Living in Iowa and working in Georgia gives:Both states — credit offsets the double tax.
Same two states, different situation
The withholding answer turns on how you are paid and where the work happens, not only on which two states are involved.
- Remote worker: Georgia → IowaHome state only
- 1099 contractor: Georgia → IowaHome state, plus the client state if you work there
- Moved mid-year: Georgia → IowaTwo part-year returns
Other Georgia pairs
Questions people actually ask
I live in Georgia and work in Iowa. Which state takes the tax out of my paycheck?
Both states tax the same wages, and a credit undoes the overlap. Iowa withholds as your work state and you file a Iowa nonresident return; Georgia taxes residents on all income, so you also file at home and claim the credit for tax paid to Iowa. File Iowa first.
Which state should my employer be withholding for?
Iowa. The wages are sourced to Iowa, so Iowa withholding is correct and there is no Georgia withholding to set up.
Will I end up paying tax twice on the same income?
Not twice over, but you will pay the higher of the two rates. Georgia gives residents a credit for tax paid to Iowa on the same income, claimed on Form 500 Schedule 2. The credit is capped at the Georgia tax on that income, so if Iowa taxes it more heavily the excess is not refunded by either state.
How current is this?
The Georgia and Iowa rules on this page were last checked against Georgia Department of Revenue and Iowa Department of Revenue on 2026-08-07. We re-check the full grid every December after state legislative sessions close, and re-check the convenience-of-the-employer states quarterly because that is where the rules move fastest.
Sources
Every fact above comes from the revenue department that publishes the rule. We do not cite secondary summaries, and we do not restate a figure we could not find at source.
- Georgia Department of Revenue — individual income taxaccessed 2026-08-07
- Iowa Department of Revenue — individual income taxaccessed 2026-08-07