The iron is an item in Kick the Buddy,located in the appliances page.
When the iron is upright,it "turns on".This makes it able to deflate Buddy when he touches it at the correct spots (usually behind the iron).Buddy's deflated body parts can't be hit,so you will need to wait until they inflate to hit those body parts.The iron hurts Buddy if he didn't touch the deflating hitboxes,so it can be used as a whacking stick,similar to the Toaster.
When Buddy is whacked with the iron,it can give him cuts and bruises.Steam is also released from the iron when it hits Buddy.
You can perform combos with the iron,and they have a lot to do with stretching Buddy.
One combo that can be done is: stretch hand to front to release to whack to throw.This is one combo,but there are many more to find.