Around 32 people were injured, including policemen, sources told dpa.
The attack took place near the Directorate of Public Pension, one of several government buildings in al-Karkh area in the Iraqi capital, the spokesman of Baghdad's police forces said in a statement.
Witnesses near the area told dpa that the explosion was very loud and black smoke could be seen over the neighbourhood.
Many Iraqis head to the area to settle their retirement plans if they were state employees or worked in the security forces.
At least 13 others were killed when another car bomb went off late Monday near a popular ice cream shop in the bustling Karada.
The Islamic State extremist militia claimed responsibility for both blasts, saying it targeted Shiite crowds in both cases.
The radical Sunni terrorist group has targeted Baghdad repeatedly in a series of attacks in recent weeks. It regards Shiites as heretics, often targeting markets, restaurants and other crowded locations in mainly Shiite districts, as well as Shiite religious ceremonies.
Iraq is currently engaged in a US-backed military campaign aimed at driving Islamic State from the militia's key stronghold of Mosul, the country's second-largest city.
Troops forced the extremists out of the eastern side of the city almost a month ago and now are fighting to dislodge them from western Mosul.
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