Tax Guidance

The guidance available here explains the general guides rather than detailed discussions of Iowa tax law. We make every attempt to keep guidance current, however, changes in law or policy may not be immediately reflected.

If you have tax questions, search our Frequently Asked Questions.

For information on how to request tax guidance, see the Department's Tax Guidance Request page.

Tax Guidance

Tax Type:
Sales & Use Tax

This guidance addresses the taxability of purchases of tangible personal property, specified digital products, and services common to the manufacturing industry. This page is a general guide and is not binding on taxpayers or the Department. Refer to relevant Iowa Code provisions and administrative rules cited throughout the webpage for binding guidance, interpretations, and examples. For issues not addressed in this guidance, contact Taxpayer Services at 1-800-367-3388 or 515-281-3114 or submit a request for tax guidance.

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Tax Type:
Income Tax, Iowa Tax Reform

Iowa’s conformity with the federal limitations on business interest expense deductions imposed by Internal Revenue Code (IRC) section 163(j) varies depending on the year. For tax years beginning on or after Jan 1, 2019, and before January 1, 2020, Iowa conformed with the federal limitation. At this time Iowa does not conform to the federal limitation for tax years beginning on or after January 1, 2020. Due to these differences in conformity, some taxpayers will need to make certain adjustments to their federal business interest expense deduction to calculate the correct Iowa deduction amount for a given year.

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Tax Type:
Income Tax, Iowa Tax Reform

This guidance was updated on 05/03/2021 to describe required adjustments and reporting procedures in tax years beginning on or after January 1, 2019 and before January 1, 2020, for partnerships and their partners that had business interest expense that was disallowed as a deduction for federal purposes under section 163(j) of the Internal Revenue Code in tax year 2018, but that was allowed as a deduction for Iowa purposes in tax year 2018 because of nonconformity. See Business Interest Expense Deduction for more information about adjustments to the business interest expense deduction required for tax years beginning on or after January 1, 2020.

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Tax Type:
Sales & Use Tax

This guidance provides an overall summary of information including details specific if you are an Employee, Independent Contractor (Self Employed), or Employer. Additionally there are details regarding returns/schedules to be filed, reporting income from tips, what is subject to sales tax, Local Option Sales Tax, and Consumer's Use Tax.

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Tax Type:
Income Tax, Coronavirus/COVID-19

On March 27, 2020, President Donald Trump signed Public Law 116-136, the Coronavirus Aid, Relief, and Economic Security (CARES) Act of 2020. The CARES Act includes a number of federal tax changes, and several are retroactive to tax years 2018 and 2019. Iowa has not conformed with any of these federal tax changes to the extent they apply to a tax year beginning prior to January 1, 2020. Iowa generally conforms with these federal tax changes to the extent they affect Iowa income taxes for tax years beginning on or after January 1, 2020. This guidance focuses primarily on Iowa’s nonconformity with this federal law for tax years 2018 or 2019, but it also includes explanations of certain other provisions and their impact on Iowa income taxes for tax years beginning on or after January 1, 2020 that may be of interest to taxpayers.

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Tax Type:
Income Tax

On June 29, 2020 Governor Reynolds signed into law House File 2641. Division V of that bill modified the procedures and requirements for reporting federal income tax changes made after July 1, 2020, to the Iowa Department of Revenue. This guidance is intended to provide a general overview of these procedures and requirements.

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Tax Type:
Sales & Use Tax

At the time of a taxable purchase, Iowa state sales/use tax is collected by the retailer from the buyer. Unlike tangible personal property, which is subject to sales/use tax unless specifically exempted by Iowa law, services are subject to sales/use tax only when specified by Iowa law. Iowa sales tax is due when the first use of a taxable service occurs, or potentially could occur. The Iowa use tax complements the Iowa state sales tax. Generally, when a taxable service is purchased or obtained outside of Iowa for use in Iowa, it is subject to Iowa use tax.

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Tax Type:
Sales & Use Tax

This guidance is intended as a general guide and is often considered a primary resource for contractors taxability. For additional details reference Iowa Administrative Rules Chapter 701-219.

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Tax Type:
Sales & Use Tax

A general guide but not an all-inclusive discussion of Iowa sales and use tax law. Generally considered the primary guidance resource for sales & use tax.

See Iowa Tax Issues for Nonprofit Entities for nonprofit entities that qualify for exemption.

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Tax Type:
General, Income Tax, Tax Credits, Coronavirus/COVID-19

The Department has issued new guidance related to Iowa’s conformity with certain tax provisions of the federal Consolidated Appropriations Act, 2021. This guidance focuses primarily on Iowa’s nonconformity with this federal law for tax years beginning prior to January 1, 2020. Iowa generally conforms with the federal tax changes to the extent they affect Iowa income taxes for tax years beginning on or after January 1, 2020.

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