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On March 23, 2018, President Trump signed into law the Consolidated Appropriations Act, 2018 (P.L. 115-141). Among other changes to the Internal Revenue Code (IRC), this bill included a fix to the so called “grain glitch,” which occurred when IRC section 199 was repealed under Tax Cuts and Jobs Act (TCJA) in 2018.

The Department of Revenue recognizes travel/hospitality is one of many industries that has been severely impacted by the recent pandemic. This also impacts local governments and organizations in those communities that benefit from Iowa’s hotel/motel tax. The Department collects the tax and distributes the funds back to local governments on a quarterly basis.

Local Government Officials:

The Department of Revenue has received questions from many of you regarding the impact of COVID-19 on local option sales tax collections. We have been monitoring and will continue to monitor the situation. At this time, we have decided not to make any adjustments to the current monthly estimates for Fiscal Year 2020.

Iowa Director of Revenue Kraig Paulsen has announced businesses in Iowa can continue to apply for a deferral of state sales and/or withholding tax.

Although a number of tax filing deadlines were recently extended by Governor Reynolds and the Iowa Department of Revenue, not all tax filing deadlines have been extended. The Department is reminding taxpayers that a number of important tax deadlines are approaching soon and taxpayers should meet those deadlines to avoid interest, penalties, or loss of other tax benefits.

Des Moines, Iowa – The Iowa Department of Revenue announced today conditional penalty relief for taxpayers required to make estimated payments. The changes, prompted by COVID-19, are the result of Order 2020-03, an order signed by Director of Revenue Kraig Paulsen.

On March 23, Governor Kim Reynolds announced a new Iowa Small Business Relief Program to support the state’s small businesses impacted by the COVID-19 pandemic. The program offered small business relief grants, administered by the Iowa Economic Development Authority.

The Iowa Department of Revenue has heard from taxpayers and tax practitioners regarding the information needed in correctly determining whether certain enumerated temporary labor services qualify as tax-exempt services used in processing in accordance with Iowa Code section 423.3(50) and Iowa Administrative Code rule 701-230.3.

The Iowa Department of Revenue today extended one income tax withholding deposit due date for certain taxpayers. The change, prompted by COVID-19, is designed to provide flexibility to disrupted businesses. The extension is a result of an order signed earlier today by Director of Revenue Kraig Paulsen.