Understanding the interaction between genetic and epigenetic variation remains a challenge due to confounding environmental factors. We propose that human induced Pluripotent Stem Cells (iPSCs) are an excellent model to study the relationship between genetic and epigenetic variation while controlling for environmental factors. In this study, we have created a comprehensive resource of high-quality genomic, epigenomic, and transcriptomic data from iPSC lines and three iPSC-derived cell types (neural stem cell (NSC), motor neuron, monocyte) from three healthy donors. We find that epigenetic variation is most strongly associated with genetic variation at the iPSC stage, and that relationship weakens as epigenetic variation increases in differentiated cells. Additionally, cell type is a stronger source of epigenetic variation than genetic variation. Further, we elucidate a utility of studying epigenetic variation in iPSCs and their derivatives for identifying important loci for GWAS studies and the cell types in which they may be acting.