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

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

The 2020 Iowa legislature defined the term “computer peripheral” and added that term to the existing sales tax exemption for computers used in processing or storage of data or information by an insurance company, financial institution, or commercial enterprise (see Iowa Code section 423.3(47)). The Department is providing the following guidance, including non-exhaustive lists of devices, so taxpayers know whether certain devices are taxable or exempt as a computer or computer peripheral.

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Tax Type:
Property Tax

Property taxes are not determined by a single individual who assesses your property and sends you a bill. The final tax rate is the result of budgets established to provide services, an assessor’s assessment, a county auditor’s calculations, and laws administered by the Department. Because property assessment involves a series of events that takes 18 months from start to finish, this information will not be able to answer all your questions. It should, however, be able to explain the basic principles and events involved in calculating the property tax rate.

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Tax Type:
Sales & Use Tax

Many Iowa retailers have established or strengthened their online presence to make sales to their customers or perhaps reach new ones. The Department is providing this guidance to make sure these businesses are aware of their tax compliance obligations for sales across Iowa and into other states. Topics included within this guidance: Law Changes, Local Option Sales Tax, Marketplace Sales, Remote Sales, Streamlined Sales Tax.

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Tax Type:
Sales & Use Tax

During the 2019 Legislative Session, the General Assembly added a new exemption from sales and use tax under House File 779 for grain bins and grain bin materials, effective July 1, 2019. The Department has adopted administrative rules to implement the new exemption. The rules went into effect August 19, 2020. This guidance summarizes the exemption and new administrative rules and addresses some common questions and issues taxpayers may have about the exemption.

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