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Temporary Sales Tax Permit FAQs
To obtain a temporary permit, call 563-386-6484 x1
Frequently Asked Questions
1. Am I a sponsor, vendor or exhibitor?
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The sponsor runs the show or event.
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The vendor sells products.
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An exhibitor shows or demonstrates an item, perhaps to obtain leads on other sales.
2. Is food taxable?
Sales of prepared foods are taxable in 3 situations:
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Food and drink prepared on or off the premises by a retailer or vendor of the retailer for consumption on the premises
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Catered food
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Off premises consumption where a sale of food is clearly identifiable as being for consumption off the premises, whether the food is intentionally hot or intentionally cold, prepared by retailer or vendor, or for immediate consumption
3. I paid tax when I bought materials to make crafts. How do I take a credit for paying this tax?
You may file a claim for refund or apply for a permanent sales tax permit and use the resale exemption with your permit number for future purchases.
4. My organization is tax exempt. Do we have to collect sales tax?
Non-profit organizations, including churches, are not automatically exempt from taxes in Iowa. A non-profit organization or corporation is treated the same as any other private citizen for sales and use tax when purchasing retail goods and taxable services. Admissions, gambling, and raffling receipts are subject to tax unless conducted by cities or counties. Sales tax must be paid unless some other general sales tax exemption applies.
5. Why do I have to pay sales tax?
All merchants or vendors are required by law to collect and remit appropriate sales tax. The customer pays the tax that you collect and send to the State.
6. How much sales tax must I collect?
Iowa's state sales tax rate is 5% through June 30, 2008. Beginning July 1, 2008, the rate changes to 6%. There are cities and counties that have local option tax.
7. Where do I get a sales tax chart?
You may obtain one online or call 515/281-7239 and ask that one be mailed to you.
8. I have an Iowa Sales Tax Permit. Am I required to file a temporary return?
No. Please provide the sponsor with your active Iowa Sales Tax Permit number and he or she will provide it to us on your behalf. If you receive correspondence from the department after the event is over, you will need to provide the sales tax number at that time as well.
9. Am I required to mail the tax return even if I had no sales?
Yes, if you have attended a temporary event you must respond that you had $0 sales. If you have a permanent sales tax permit and had no sales for your filing period, you must file your return with $0 sales.
10. I want to sponsor a craft show. What are my responsibilities and how do I accomplish them?
Sponsors of flea markets, craft shows, antique shows and other temporary events must verify that the exhibitors are licensed to collect sales tax. Sponsors must obtain an Iowa sales tax permit number or a good faith statement from each vendor. Sponsors may be responsible for sales tax that is not collected by the vendors, if the vendor information is not obtained.
11. Who do I contact for a temporary sales tax permit?
Exhibitors/vendors may obtain temporary permits if they are not in business regularly. To obtain a temporary permit, call 563-386-6484, ext. 1.
12. My company collects the tax from me. How do I handle this?
Companies like Avon, Discover Toys and Pampered Chef collect and remit the sales tax from their salespeople. Your company will be able to provide you with the sales tax number used to remit sales tax to Iowa. Please provide that number to us.
Temporary Sales Tax Events
Sponsors of flea markets, craft shows, antique shows and other temporary events are responsible for notifying the department of the event, providing a list of the vendors, and verifying that the exhibitors are permitted to collect sales tax. Sponsors must obtain an Iowa sales tax permit number from each vendor or provide a temporary sales tax permit to the vendor. Sponsors may be personally liable for the sales tax not remitted by the vendors if they do not obtain the proper information from vendors.
Sponsors need to be aware that admission charges are taxable. Entry fees are taxable, even if the fee is used for prizes. However, entry fees are not taxable when admission is charged.
A packet will be sent to the sponsor before the show or event. It includes:
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a report documenting vendors to be completed by the sponsor and returned
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a temporary permit for each vendor who does not have a regular Iowa sales tax permit number
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a cover letter
Once the report has been submitted and the permits distributed, the sponsor's responsibility ends.
Each vendor must return his or her temporary permit with the sales tax collected to the address on the permit within 10 days of the event.
Vendors who have regular Iowa Sales Tax Permits will report their sales and tax collected on their returns as usual.
Exhibitors and vendors may obtain temporary permits if they are not in business regularly. To obtain a temporary permit, call 563-386-6484, ext. 1.