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Iowa general fund receipts down about $485 million through March 3, analyst says
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Summary
Eric Richardson of the Legislative Services Agency reported that Iowa General Fund receipts through March 3 fell roughly $485 million (about 9%) year to date, driven by declines in personal and corporate income taxes; the next Revenue Estimating Conference is scheduled for March 12.
Eric Richardson, Senior Fiscal Analyst at the Legislative Services Agency, said the Iowa General Fund's year-to-date receipts through March 3 show a decrease of $485,000,000, or roughly 9 percent.
The drop reflects sharp declines in major revenue sources: individual income tax receipts are down 14 percent and corporate income tax receipts are down 37.1 percent, while sales and use tax receipts rose 6.2 percent. Richardson also reported that regular income tax refunds have fallen by $156,000,000 (36.6 percent), in part because fewer pass-through entity tax (PTET) credits have materialized into refunds so far in FY2026.
"Receipts through March 3 reflect a decrease of $485,000,000 and minus 9%," Richardson said. He noted that PTET, introduced in FY2024 with retroactivity to tax year 2022, produced relatively large credits and refund activity in earlier years that has subsided in FY2026.
Richardson contrasted gross and net measures: gross revenues through March 3 are down 9.9 percent, with gross personal income tax down 17.3 percent and gross corporate income tax down 29.4 percent, while net revenues appear stronger because regular refunds are lower (down 27.7 percent).
Other declines include an $18,000,000 (42.1 percent) drop in franchise tax receipts and an $81,000,000 (38.8 percent) decrease in insurance and other taxes, partly driven by suspense-account transactions. School infrastructure transfers, by contrast, increased 5.7 percent in FY2026.
A memo charting the monthly growth calculation shows that growth through March 3 is $111,000,000 lower than the growth calculation through February 3. Richardson attributed part of the revision to a $64,000,000 decline in expense-account transactions and miscellaneous tax and a $23,000,000 decrease in insurance premium tax receipts.
Richardson explained that insurance premium taxes are prepaid for the calendar year (50 percent of prior-year liability due June 1 and Aug. 15), with final payments due March 1, noting that timing can affect year-to-date comparisons.
Overall, net revenue growth through March 3 of negative 9 percent remained below the December 2025 Revenue Estimating Conference projection of negative 8.8 percent for the full fiscal year. Richardson warned that impacts from the OVA and previously enacted tax rate reductions on the franchise, inheritance, individual income and insurance premium taxes are expected to weigh on net revenue growth as FY2026 continues.
Richardson said the next Revenue Estimating Conference is scheduled for March 12; he said results from that meeting should give a clearer outlook for FY2026 and beyond. The memo closed with a reminder that the next monthly video memo will be posted in early April.
