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Iowa Sales Tax

On this page you will find handy sales and use tax information about Iowa.

How to use this page:

We’ve pulled in the information from all our Charts for a consolidated view by state.  Here you can see the sales tax rates and if the state has remote seller nexus rules. You can also see any sales tax holidays or amnesty programs that may exist, though these do not apply to all states.

Below the chart you can find any News & Tip item we have published that relates to Iowa that you can filter by topic. This will help you get informed on current and past legislation that has passed in the state.

State Sales Tax Rates
State Rate

6.000% Remote sellers are required to collect sales tax if they exceed Iowa’s economic nexus threshold.
Range of Local Rates

0% – 2% Some local jurisdictions do not impose a sales tax.
Local Rates Apply to Use Tax

No Remote sellers are required to collect sales tax if they exceed Iowa’s economic nexus threshold.
Remote Seller Nexus Rules
CLICK-THROUGH NEXUS

1/1/2019
AFFILIATE NEXUS

6/11/2013 and 1/1/2019
REPORTING REQUIREMENTS

1/1/2019
ECONOMIC NEXUS

1/1/2019 – see state notice
MARKETPLACE NEXUS

1/1/2019
Sales Tax Holidays
Annual Back to School Holiday

August 2-3, 2024

1. Clothing and footwear – less than $100 per item (excluding clothing accessories).
Sales Tax Amnesty
Status

Inactive

Amnesty Filing Dates

July 1, 2012 - November 1, 2013

Go to Iowa Amnesty Page
AMNESTY INCLUSION PERIODS

TAX TYPES AND CONDITIONS

Unclaimed Property
AMNESTY BENEFITS

Waiver of interest and penalties.

Administration Information
Streamlined Sales Tax Status

Full Member
NUMBER OF TAXING AUTHORITIES

1,002 Sales Tax Jurisdictions

HOME RULE AUTHORITIES

N/A
Sales Tax Sourcing (Intrastate)

Destination
Sales Tax Return Due Date

Last day of the month following the reporting period
Exemption Information
RESALE CERTIFICATE

Iowa Resale Certificate
TYPES OF EXEMPTIONS

Product types of exemptions: resale, leasing, farm machinery and equipment, processing, R&D equipment, specified digital products, production utilities, pollution control equipment

 

Entity types of exemptions: sales from educational, religious, or charitable activities; government agencies, museums, residential care facilities

 

Iowa Exemption Certificate Forms
State Links
State Tax Web Page

Iowa Department of Revenue
Rate Look-Up Page

Iowa Sales Tax Rate Look-Up
Registration Link

Register for Iowa Sales Tax
History & Fun Facts
HISTORY

  • Iowa sales tax was first imposed in 1934 at a rate of 2 percent and applied only to gross receipts from the sale of tangible personal property, metered gas, electricity, water, communication services, and amusement and athletic event admissions.
  • Iowa sales tax was made permanent on April 1, 1937 and the state imposed a complimentary use tax.
  • In 2004, Iowa enacted legislation to conform with the Streamlined Sales and Use Tax Agreement.
FUN FACTS
  • In 2007, the Iowa Department of Revenue sent retailers a bulletin reminding them to quiz customers about their intentions for the purchase of pumpkins. Iowa taxes retail sales but exempts groceries and was losing out on tax dollars – particularly around Halloween – when pumpkins were categorized as food at checkout.

Iowa Enacts Legislation Updating SST Conformity

Iowa has amended the definition of \”sales price\” in order to conform to the Streamlined Sales and Use Tax (SST) Agreement.

Iowa Issues Policy Letter on Cloud Computing

The Iowa Department of Revenue has issued a policy letter addressing the taxability of hosted software and related training services.

CRIC Finds States Out of Compliance with SST Agreement

The Streamlined Sales Tax (SST) Compliance Review and Interpretations Committee (CRIC) voted to find Minnesota, Utah, and Vermont out of compliance with the SST Agreement.

Free Flu Vaccines are Taxable in Iowa

In a policy letter, the Iowa Department of Revenue determined that the free distributions of flu vaccines are subject to Iowa sales and use tax.

Iowa Clarifies Complimentary Beverages and Meals

The Iowa Department of Revenue has made corrections to an article issued in the June 2008 edition of eNews, discussing the taxability of complimentary beverages and meals provided by bars, restaurants, and hotels/motels.

Iowa Spectrographic Color-Matching Machine Tax Exempt

The Iowa Court of Appeals upheld a decision made by a district court that exempted a spectrographic color-matching machine from Iowa\’s sales and use taxes.

Iowa Increases State Sales Tax Rate to 6%

The state sales and use tax rate will increase from 5% to 6%, and the School Local Option Sales Tax (SILO) will cease to exist as a separate tax.

Iowa Amends Good-Faith Standard to Conform to SST Agreement

In order to comply with the Streamlined Sales and Use Tax Agreement (\”the Agreement\”), the Iowa Department of Revenue has amended a rule regarding the determination of a sale and sale price.

Professional Firms Taxed on Computer Purchases in Iowa

The state recently provided guidance with respect to computer purchases by professional companies. In a policy letter issued by the Iowa Department of Revenue, the state indicated that purchases of computers by commercial enterprises for processing or data storage are…

Iowa Legislation Enacted Conforms to Streamlined Sales Tax Agreement

A purchaser, purchaser\’s seller or certified service provider (CSP), or purchaser holding a direct pay permit will not be liable for sales/use tax.

Iowa Amnesty Program Enacted

A tax amnesty program, set forth by the Iowa Department of Revenue, will commence on September 4, 2007 and end on October 31, 2007.

Iowa Implements Credits for Renewable Fuel

New rules passed in a series of Iowa bills provide a use tax credit for the purchase and replacement costs incurred by an electric utility transitioning to soy-based transformer fluid.

Iowa sales tax holiday: Aug 5 – Aug 6, 2005

Clothing and footwear less than $100.

Iowa issues new regulations intended to implement the Streamlined Sales Tax Act.

In an effort to implement the Streamlined Sales Tax Act, the Iowa Department of Revenue has adopted new sales and use tax regulations.

Annual tax holiday in Iowa

Iowa will have its fourth annual Sales Tax Holiday on Friday and Saturday, August 6-7, 2004. Like last year, the exemption only applies to certain clothing and footwear with a selling price under $100. Clothing is defined as “any article…

Iowa construction contractor’s materials subject to tax.

In order for construction contractors to buy building materials exempt from tax they must receive both an authorization letter and exemption certificate from an exempt entity.

Iowa storm water drainage services taxable.

An Iowa Appellate Court affirms the decision that fees charged for storm water drainage are taxable to nonresidential commercial operations because rainwater collection is a taxable sewage service.

Iowa tax holiday.

The Iowa Department of Revenue has enacted a tax holiday beginning August 1, 2003 and ending August 2, 2003.

Iowa proposed rate change

Iowa has introduced legislation proposing a sales tax rate increase from the current 5% to 6%.

Iowa signage production and activities can be taxable.

Any activity involving the design, install or repair of signage in the state of Iowa is considered a taxable activity unless a specific exemption is applicable.