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- Automobile Rental Tax
- Cigarette & Tobacco
- Construction & Contractor
- Corporate Income Tax
- Drug Stamp Tax
- Fee for New Registration (formerly One-Time Registration Fee, Motor Vehicle Use/Lease Tax)
- Fiduciary Tax
- Franchise Tax
- Fuel Tax
- Gambling, Social and Charitable
- Local Hotel and Motel Tax
- Hazardous
- Individual Income Tax
- Income School District Surtax
- Income Emergency Medical Services Surtax
- Inheritance and Estate Taxes
- Insurance Premium Tax
- Liquor Taxes
- Local Option Sales Tax
- Mobile, Manufactured, and Modular Home Tax
- Ocean Marine Profit Tax
- Property Tax
- Real Estate Transfer Tax
- Sales & Use Tax
- Unemployment Taxes
- Withholding Tax
Automobile Rental Tax
Description: This is an excise tax imposed on the rental of passenger vehicles designed to carry nine or fewer passengers that are rented for a period of 60 days or less. The tax is not imposed on delivery trucks, motorcycles, and motorized bicycles.
Tax Rate: 5% tax on the rental charge for certain vehicles. This is in addition to the state sales tax, use tax, and local option tax, if any.
Distribution of Funds: Road Use Tax Fund
Due Date(s) of Returns: This excise tax is remitted on the sales and use tax return. If a taxpayer collects this tax, it must be remitted on a monthly basis, due on the last day of the month following the month in which the tax was collected.
Back to topCigarette & Tobacco
Cigarette Tax
Description: The tax is imposed on the sale of cigarettes and must be paid by the person making the first sale in Iowa. A stamp affixed to each cigarette package is proof that tax was paid.
Tax Rate: $1.36 per package of 20; $1.70 per package of 25
Distribution of Funds: State General Fund and the Health Care Trust Fund
Due Date(s) of Returns: Tax returns must be filed by the holder of a state or manufacturer’s permit by the 10th day of each month for the preceding calendar month.
Tobacco Products Tax
Description: Tax is imposed on the sale of all tobacco products except cigarettes and little cigars, which are taxed differently.
Tax Rates: 50% of the wholesale sales price, except snuff which is taxed at $1.19 per ounce, and a limitation of the tax on cigars not exceed 50¢ per cigar.
Distribution of Funds: State General Fund and the Health Care Trust Fund
Due Date(s) of Returns: Distributors or certain consumers are required to file tax returns by the 20th day of each month for the preceding calendar month.
Back to topConstruction & Contractor
Construction Equipment Excise Tax
Description: This tax is imposed on the sales price of all equipment sold or used in the state of Iowa. “Equipment” is defined in Iowa Code section 423D.1.
Tax Rate: 5%
Due Distribution of Funds: State General Fund
Due Date of Returns: This excise tax is remitted on the sales and use tax return. If a taxpayer collects this tax, it must be remitted on a monthly basis, due on the last day of the month following the month in which the tax was collected.
Contractor Registration Fee
This fee is administered by Iowa Workforce Development (IWD). Construction contractors are required by Iowa law to register every year with IWD. Conditions for registration include compliance with workers' compensation law and an unemployment insurance (FUTA) employer account number. The registration fee is $50. Most out-of-state construction contractors working in Iowa will be required to file a bond with IWD.
For more information, visit the Iowa Division of Labor's website.
Back to topCorporate Income Tax
Description: The tax is imposed on the Iowa net income of corporations doing business within this state or receiving income from property in the state. For tax years beginning on or after January 1, 1987 and before January 1, 2021, Iowa imposed an alternative minimum tax equal to 7.2% of Iowa tax preferences. For tax years on or after January 1, 1988, the tax is imposed on the unrelated business income of nonprofit corporations.
The Iowa legislature has enacted mechanism for reducing corporate income tax rates over time if net corporate receipts for a fiscal year exceed $700,000,000, down to a possible flat rate of 5.5%. New rates will be announced each year a reduction is triggered.
All rate changes become effective January 1 of the year they take effect, for tax years beginning on or after that date.
2023 Tax Rate: 5.5% on first $100,000; 8.4% on all income over $100,000
2024 Tax Rate: 5.5% on first $100,000; 7.1% on all income over $100,000
2025 Tax Rate: 5.5% on first $100,000; 7.1% on all income over $100,000
Distribution of Funds: State General Fund
Due Date(s) of Returns: Corporation tax returns must be filed by the last day of the 4th month after the close of the tax year. Cooperatives must file a return on or before the 15th day of the 9th month following the close of the cooperative’s tax year. Estimated tax payments are due from most corporations on a quarterly basis. Nonprofit corporation returns with unrelated business income are due on the 15th day of the 5th month following the close of the tax year.
Corporation Registration
Corporations must register and pay an annual fee with the Iowa Secretary of State (ISS). For more information visit Iowa Secretary of State.
Back to topDrug Stamp Tax
Description: Tax is imposed on dealers in possession of specified quantities of marijuana and other controlled substances. Visit the Iowa Legislature for rule details.
How to obtain stamps:
Stamps may be purchased at the Iowa Department of Revenue. Please contact the Department to make an appointment.
Use the Drug Tax Stamp Form, 70-510 to order by mail.
Tax Rate: $5 / gram of processed marijuana; $750 / unprocessed marijuana plant; $250 / gram of other taxable substances; $400 / 10 doses if not sold by weight
Distribution of Funds: State General Fund
Due Date(s) of Returns: Tax payment is required upon possession. The drug tax stamp must be permanently affixed to the substance as proof the tax was paid.
Back to topFee for New Registration (formerly One-Time Registration Fee, Motor Vehicle Use/Lease Tax)
Description: The sales or lease price of vehicles subject to registration is exempt from sales tax. These vehicles are subject to a fee for new registration equal to 5% of the sales or lease price. This fee for new registration also applies when vehicles are sold between private individuals.
Fee for New Registration: 5% of the sales or lease price
Distribution of Funds: Road Use Tax Fund
Motor vehicle fee for new registration exemption information and worksheets
Back to topFiduciary Tax
Description: An Iowa fiduciary return is filed for estates, trusts, and other entities that are taxed as trusts for federal income tax purposes.
Tax Rate: See Schedule E of the Iowa Fiduciary Return (IA 1041).
Distribution of Funds: State General Fund
Due Date(s) of Returns: The return with payment is due within four calendar months after the end of the tax year. A fiduciary return must be filed for every accounting period in which there is taxable income of $600 or more and for the final accounting period regardless of income.
Back to topFranchise Tax
Description: Tax is imposed on the income of state banks, national banking associations, trust companies, federally and state chartered savings and loan associations, financial institutions chartered by the Federal Home Loan Bank Board and production credit associations. For tax years beginning on or after January 1, 1987 and before January 1, 2021, Iowa imposed an alternative minimum tax equal to 3% of Iowa tax preferences.
Tax Rate:
2022 and earlier 5% of taxable income
2023 - 4.7%
2024 - 4.4%
2025 - 4.1%
2026 - 3.8%
2027 and later - 3.5%
Distribution of Funds: State General Fund. $7 million is appropriated annually to the community attraction and tourism fund.
Due Date(s) of Returns: Franchise tax returns must be filed by the last day of the 4th month after the close of the tax year or 45 days after the due date of the financial institution’s federal income tax return, excluding extensions of time to file, whichever is the later. Estimated payments are due from most financial institutions on a quarterly basis. Financial institutions which have elected S corporation status are still subject to the franchise tax, and the shareholders are allowed a tax credit against their individual income tax for their share of the franchise tax paid.
Back to topFuel Tax
Description: Tax is imposed on each gallon of fuel sold in Iowa for use in motor vehicles or aircraft. Fuel includes gasoline, diesel fuel, liquefied petroleum gas, liquefied natural gas, compressed natural gas, aviation fuel, and ethanol blended gasoline.
Iowa Fuel Tax Rates per gallon
| Fuel Type | Beginning 7/1/2024 | 7/1/23 to 6/30/24 | 7/1/22 to 6/30/23 | 7/1/21 to 6/30/22 | 7/1/20 to 6/30/21 |
|---|---|---|---|---|---|
| Gasoline | $0.300 | $0.300 | $0.300 | $0.300 | $0.300 |
| Alcohol | $0.255 | $0.245 | $0.240 | $0.240 | $0.240 |
| Ethanol Blended Gasoline E-10 to E-14 (Gasohol) | $0.300 | $0.300 | $0.300 | $0.300 | $0.300 |
| Ethanol Blended Gasoline E-15 or higher | $0.255 | $0.245 | $0.240 | $0.240 | $0.240 |
| Diesel (including biodiesel B-10 and lower, biodiesel B19 and lower effective 7/1/24) (Special Fuel Undyed) | $0.325 | $0.325 | $0.325 | $0.325 | $0.325 |
| Biodiesel B-11 or Higher Undyed (discontinued effective 7/1/24) | -* | $0.298 | $0.301 | $0.304 | $0.301 |
| Biodiesel B-20 or Higher Undyed | $0.295* | - | - | - | - |
| Aviation Gasoline | $0.080 | $0.080 | $0.080 | $0.080 | $0.080 |
| Aviation Jet | $0.050 | $0.050 | $0.050 | $0.050 | $0.050 |
| Liquefied Petroleum Gas (LPG) | $0.300 | $0.300 | $0.300 | $0.300 | $0.300 |
| Liquefied Natural Gas (LNG) | $0.325 | $0.325 | $0.325 | $0.325 | $0.325 |
| Compressed Natural Gas (CNG) | $0.310 | $0.310 | $0.310 | $0.310 | $0.310 |
| Hydrogen | $0.650 | $0.650 | $0.650 | $0.650 | $0.650 |
| Electric Fuel | $0.026 per kWh | $0.026 per kWh | - | - | - |
* Effective July 1, 2024, the biodiesel B-20 or Higher Undyed is a new fuel group and will replace the biodiesel B-11 or Higher Undyed fuel group to have a lower fuel tax rate. Additionally, biodiesel B-11 to B-19 will fall into the same taxation category as undyed special fuel (diesel).
Distribution of Funds: Road Use Tax Fund. Aviation fuel tax receipts are deposited in the state aviation fund. Watercraft fuel tax receipts are deposited in the marine fuel tax fund.
Due Date(s) of Returns: Tax returns are required to be filed by the licensee no later than the last day of the month following the month in which the fuel was withdrawn from the terminal or, in the case of LPG, LNG, or CNG, placed into the fuel supply tank of a motor vehicle. Importers are required to file semimonthly. Electric Fuel licensees are required to file returns semiannually.
Back to topGambling, Social and Charitable
The Social and Charitable Gambling Unit of the Iowa Department of Inspections and Appeals has administrative control for amusement games, contests, casino nights, and commercial promotions operated in the state. In addition, the unit regulates and licenses all games of skill and chance, bingo operations, raffles, and social gambling activities.
See Iowa Tax on Gambling.
Back to topLocal Hotel and Motel Tax
Description: Local hotel and motel tax is imposed on the gross receipts from the renting of sleeping rooms for 31 consecutive days or less. Contracts for periods of more than 31 consecutive days are exempt. To qualify, the renter must contract to rent for a single period of more than 31 days and cannot accumulate these days.
Tax Rate: May not exceed 7%. This is in addition to the state tax rate of 5%. The state rate for hotels and motels did not increase to 6% on July 1, 2008. Local option tax, if any, does not apply.
Distribution of Funds: The local government imposing the tax
Due Date(s) of Returns: Local hotel and motel tax is reported with quarterly sales tax. They are due the last day of the month following the end of each calendar quarter.
Rates and answers to common questions are available on our hotel and motel page.
Back to topHazardous
Household Hazardous Materials (HHM)
Retailers who sell household hazardous materials are required to complete an Iowa Business Tax Permit Registration, 78-005 and request a Household Hazardous Material (HHM) Permit through the Business Tax Permit Registration.
This permit must be obtained for each location selling household hazardous materials on a retail basis. Manufacturers and distributors that have independent agents selling door-to-door may purchase one permit fee of $25 for the first $3 million in sales of these materials. An additional $100 fee is charged for each subsequent increment of $3 million in sales. Fees are not prorated or refunded and must be renewed annually on July 1.
More information for Household Hazardous Materials requirements.
Hazardous Waste Fee
The Hazardous Waste Fee is for the generation, treatment, storage, disposal and transportation of waste that is hazardous.
Businesses that are assigned a hazardous waste identification number from the US Environmental Protection Agency (EPA) will receive a Hazardous Waste Fee form from the Iowa Department of Natural Resources (DNR), which administers the fee.
More information may be found on the DNR Website.
Back to topIndividual Income Tax
Description: Tax is imposed on Iowa net income of individuals and estates and trusts.
Individuals who have a net income of greater than $9,000 must file an Iowa income tax return.
Married taxpayers with a combined net income of greater than $13,500 are required to pay Iowa income tax.
A person claimed as a dependent on another person's Iowa return and having a net income of $5,000 or more is required to pay Iowa income tax.
Individuals may also be subject to the minimum tax on tax preferences and a tax on lump sum distributions from pension plans.
Exemption for persons age 65 or older:
For the 2009 and subsequent tax years, a married couple or a head of household with a total income for the year of $32,000 or less may file for exemption, if at least one spouse (in the case of a married couple) or the head of household is 65 years or older as of December 31 of the year.
For the 2009 and subsequent tax years, a single person who is 65 years or older as of December 31 of the tax year may file for exemption if his or her income is $24,000 or less.
Distribution of Funds: State General Fund
Due Date(s) of Returns: The final return and any tax owing is due by the last day of the fourth month following the close of the tax year. Individuals may be required to remit estimated tax payments quarterly.
Income tax is also collected through withholding tax. Depending on the amount of tax withheld, withholding tax deposits are due annually, quarterly, monthly, or semimonthly.
Back to topIncome School District Surtax
Description: Upon voter approval, school districts may initiate educational improvement programs where school boards may raise an additional portion of the state cost per pupil. This enrichment amount is raised through a surtax and through an accompanying property tax.
Tax Rate: Not to exceed 20% of state income tax liability. The rate is different for each school district. Lists are available within the income tax forms page.
Distribution of Funds: Local school district imposing the tax
Due Date(s) of Returns: Tax is collected with the individual income tax return. Returns are due the last day of the fourth month following the end of the tax year.
Back to topIncome Emergency Medical Services Surtax
Description: A county may impose the surtax by ordinance at the rate set by the board of supervisors not to exceed 1%.
Tax Rate: Up to 1% of state income tax liability. Only Appanoose County imposes this tax (at a rate of 1%) at this time.
Distribution of Funds: County imposing the tax
Due Date(s) of Returns: Tax is collected with the individual income tax return. Returns are due the last day of the fourth month following the end of the tax year.
Back to topInheritance and Estate Taxes
Description: These taxes are imposed on any person who becomes beneficially entitled to any property or interest by any method of transfer. A surviving spouse, decedent's lineal ascendants, descendants, and stepchildren are exempt from the inheritance tax. Administrators, executors, referees, and trustees of taxable estate transfers may also be liable for such taxes.
Tax Rate:
Inheritance Tax: From 1% to 15% depending on the amount of the inheritance and the relationship of the recipient to the decedent.
Estate Tax: Prior to July 1, 2008 -- Amount by which the allowable federal credit for state death taxes exceeds the inheritance tax due from the estate. On and after July 1, 2008 - Iowa's estate tax was repealed effective July 1, 2008.
Distribution of Funds: State General Fund
Due Date(s) of Returns: In most instances, the return must be filed and tax paid on or before the last day of the ninth month after the death of the decedent.
Back to topInsurance Premium Tax
Description: This tax is administered by the Iowa Department of Commerce. The tax is imposed on the premiums of every insurance company except fraternal beneficiary associations and nonprofit hospital and medical service corporations.
Questions about the tax should be directed to the Iowa Department of Commerce, Insurance Division, at 515-654-6600.
Iowa Insurance Division Website
Back to topLiquor Taxes
The Alcohol & Tax Operations Division is responsible for the regulation and control of alcohol in the State of Iowa.
Back to topLocal Option Sales Tax
Description: A 1% tax in addition to sales tax that is imposed by counties, cities, or unincorporated areas in a county. With a few exceptions, it is imposed on sales and services taxed under state sales tax provisions. There is no corresponding local option use tax; a local option excise tax applies to transactions involving natural gas, natural gas services, electricity, or electric service.
Local option sales tax information
Tax Rate: 1% in jurisdictions that have authorized local option sales tax.
Distribution of Funds: To local sales and service tax fund with disbursement to local jurisdictions monthly
Due Date(s) of Returns: Local option sales tax is due at the same time as the state sales tax.
Back to topMobile, Manufactured, and Modular Home Tax
Description: A square footage tax is imposed on homes located in mobile home parks and manufactured home communities. Homes located outside of mobile home parks and manufactured home communities are assessed and taxed as real estate.
Tax Rate: 20¢ per square foot if the home is located in a mobile home park or manufactured home community. The tax decreases when the home is more than five years old to 18¢, and again when the home is more than nine years old to 16¢. If the home is located outside a mobile home park or manufactured home community, the levy rate applicable to real estate.
Distribution of Funds: Collected by the county treasurer and distributed in the same manner as property taxes.
Back to topOcean Marine Profit Tax
Description: This tax is administered by the Iowa Department of Commerce (IDC), Insurance Division. Questions about the tax should be directed to the IDC at 515-654-6600 or visit Iowa Insurance Division website.
Back to topProperty Tax
Description: Property tax is levied on the taxable value of real property. The taxable value may be a percentage of the assessed value as a result of statewide limitations for allowable growth. The assessed value is 100% of market value except for agricultural realty, which is assessed according to its productivity.
Tax Rate: Differs in each locality and is a composite of county, city, school district, and special levies. Taxes are levied in terms of dollars per $1,000 of taxable value and are collected locally.
Distribution of Funds: Local jurisdictions
Due Date(s) of Returns: The tax may be paid in two installments, the first of which becomes delinquent on October 1 and the second of which becomes delinquent on April 1.
Back to topReal Estate Transfer Tax
Description: The tax is imposed on the total amount paid for the property. The tax is paid to the county recorder in the county where the real property is located.
Tax Rate: The calculation is based on $.80 per each increment of $500, with the first $500 being excepted from tax. Example:
Purchase Price of $2,600
$2,600 - $500 = $2,100
$2,100 / $500 = 4.2 (Because there is a remainder of .2, we would go to the next multiplier. The tax is on each increment of $500.)
5 x $.80 = $4.00 of transfer tax
Distribution of Funds: 17.25% of the tax receipts are retained by the county. Of the remaining 82.75%, 90% goes in the State General Fund, 5% in the Housing Trust Fund, and 5% in the Shelter Assistance Fund
Due Date(s) of Returns: Tax is payable when the deed or other instrument conveying the real property is presented for recording. Tax returns must be filed by the county recorder with the State Treasurer by the 10th day of each month for tax collected during the preceding month.
Back to topSales & Use Tax
Sales Tax
Description: The tax is imposed on the sales price of sales of taxable tangible personal property, specified digital products, and taxable (enumerated) services. Iowa law allows for numerous exemptions based on the item sold or the purchaser.
Tax Rate: 6%
Distribution of Funds: State General Fund
Due Date(s) of Returns: Taxpayers that collect less than $1,200 in sales and use tax per calendar year may file a return annually, due January 31 for tax collected the prior year. Taxpayers that collect $1,200 or more in sales or use tax per calendar year must file a return every month, due on the last day of the month following the month in which the tax was collected.
Use Tax
Description: Use tax includes:
- Tax that is voluntarily collected by a retailer that is not required to collect sales tax. Learn more.
- Tax due on taxable purchases when the retailer does not collect sales tax.
Tax Rate: 6%
Distribution of Funds: State General Fund
Due Date(s) of Returns: Taxpayers that collect less than $1,200 in sales and use tax per calendar year may file a return annually, due January 31 for tax collected the prior year. Taxpayers that collect $1,200 or more in sales or use tax per calendar year must file a return every month, due on the last day of the month following the month in which the tax was collected.
Back to topUnemployment Taxes
Unemployment taxes are administered by Iowa Workforce Development (IWD). For more information, call 515-281-4199 or visit IWD's Website.
Back to topWithholding Tax
Description: Every employer who maintains an office or transacts business in Iowa and who is required to withhold federal income tax on any compensation paid to employees for services performed in Iowa is required to withhold Iowa individual income tax from that compensation.
Tax Rate: The amount withheld is calculated using the Iowa withholding tables, formulas, or percentages.
Due Date(s) of Returns: Depending on the amount of tax collected, a return is due quarterly, monthly, or semimonthly.
It is important to file and pay the returns and tax due by the due date to avoid penalty and interest. A return should be filed with zeros if an employer does not have withholding to report.
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