Use our table to find out which states have mutual agreements. And find out which form the employee must fill out to retain you from his country of origin: which states are mutualist with Iowa? Iowa actually has only one state with tax receptivity: Illinois. Workers working in Kentucky and living in one of the member states can submit Form 42A809 to ask employers not to withhold income tax in Kentucky. Tax recidivisce is an agreement between states that reduces the tax burden on workers who commute to work across national borders. In tax-recidivism countries, employees are not required to file multiple government tax returns. If there is a reciprocal agreement between the State of origin and the State of labour, the worker is exempt from public and local taxes in his country of employment. .