What sales are taxed for a hotel or motel?

Lodging

As of July 1, 2020, the following situations are exempt from the hotel and motel tax:

  • When the same person rents lodging for more than 90 consecutive days, the rental is exempt after the 90th day, whether the rental is a room, apartment, or sleeping quarter at any place where sleeping accommodations are furnished to transient guests.
    • Tax is due and not refundable for the first 90 days of an extended rental.
    • “Person” applies to an individual as well as any legal entity.
  • When the rental is a sleeping room in a dormitory at any university or college located in the state of Iowa.
  • When the lodging is furnished to a guest of a tax-exempt religious institution (tax-exempt under Iowa Code section 427.1(8)) and the purpose of the lodging is for a religious retreat or function.
    • Exemption is not applicable to places normally open for lodging to transient guests.
  • When the lodging is furnished to family and friends of a patient at a hospital, as defined in Iowa Code section 135B.1(3), by a nonprofit lodging provider (tax-exempt under Internal Revenue Code section 501(c)(3)) during the patient’s time of medical need and the length of the stay is based upon the needs of the patient, family, or friends.
    • The nonprofit lodging must maintain an established lodging facility for family and friends of a hospital patient during the patient’s time of medical need.
    • Lodging furnished to family or friends of a patient at a hospice or other health care facility is not eligible for this exemption. The language used in the new exemption requires the lodging to be furnished to family and friends of a patient at a “hospital,” which has specific meaning in Iowa law.