Iowa Sales Tax Compliance
Iowa has a state-level sales tax rate of 6%. There are a couple of reduced rates offered in Iowa. Motor Vehicle registration is exempt from sales tax but subject to 5% new registration fee. Hotels and motels have a standing 5% state excise tax on lodging plus local hotel and motel tax which can range from 1%-7% rate.
Iowa sales tax compliance does have varied rates when it comes to local taxing jurisdictions. There are 99 total local county taxing rates within this state which can seem intimidating to taxpayers at first. However, the local tax rate is either 0% or 1% in addition to the state-wide tax rate of 6% which is not too much of a difference. Outside of a couple of specific exemptions, most companies will collect and remit a 6% state sales tax rate as well as a 1% county local rate to the specific county the sale was made.
Iowa Sales Tax
There are four filing frequencies at which taxpayers file their returns in Iowa: semimonthly, monthly, quarterly, and annually. Iowa sales tax compliance requires taxpayers with quarterly tax returns to file by the last day of the month in the month after the reporting period. Annual filers’ returns will be due on January 31st. If the return due date falls on a weekend or national holiday, then the correct due date for your filings will get pushed back to the next business day.
In Iowa, monthly taxpayers are required to submit pre-payments for the first two months of the quarter on the 20th of the month after the reporting period. Semi-monthly taxpayers who have over $60,000 in tax liability per year will have a first pre-payment from the 1st to the 15th. This pre-payment will be due on 25th of that month. The second pre-payment includes the 16th to the end of month, and this payment is due on the 10th day of the following month.
Iowa sales tax compliance does not offer any vendor compensation, vendor discounts, or timely filing discounts. This makes calculating taxes a bit easier, but make sure to remember the pre-payment dates. The pre-payment due dates are the most challenging part of Iowa sales tax compliance. While taxpayers can expect to collect and remit a 6% tax rate on most sales, the pre-payments are an important part of Iowa’s tax filing. The monthly pre-payments are due on the 20th, but the final quarterly return is due the last day of the month following the reporting period.
If you are curious to learn more information about Iowa sales tax compliance, make sure to visit Iowa’s sales tax website.
Agile's Iowa Sales Tax Compliance Services
Agile’s experienced sales tax consultants can help by completing your company’s ongoing
compliance filings in the state of Iowa. In fact, we’ve offered an outsourcing solution for this process since 2005. You can learn more about our outsourced
sales tax compliance services or simply give us a call at (888) 350-4829. We are interested to learn more about your needs, and you might be surprised how little it will cost to have a sales tax expert take this responsibility off your hands!
