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Iowa's new Seed Investor Tax Credit takes effect, replacing the Angel credit

Iowa's new Seed Investor Tax Credit takes effect, replacing the Angel credit

Under SF 657, Iowa's Seed Investor Tax Credit took effect Jan 1, 2026, replacing the repealed Angel Investor Tax Credit. It offers a 20% credit (35% for investments in communities under 15,000 population), capped at $100,000 per investor and $500,000 per business, with a combined $10M annual cap—up from the old $2M cap.

Why this matters for founders

Iowa startups—especially in smaller towns where the credit hits 35%—can use the larger $10M pool to attract in-state seed investors this year.

Source: Iowa Economic Development (opportunityiowa.gov)

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