Message from the Director:

Let me take this opportunity to thank you for a great filing quarter (first quarter, 2006). For the first time, we experienced a quarter when individual income tax returns, withholding tax returns and sales and use tax returns were due at the same time and electronic filing options were in place for each. I am pleased to report almost all withholding and sales/use returns were filed electronically, along with an ever increasing percentage of individual income tax returns.

Providing the best customer service possible was the goal of the department in making electronic filing options available. As part of our customer service focus, we are ready to address concerns by telephone and e-mail from all Iowans when needed. When we experience a quarter like this for the first time, we need to be sure we have done everything possible to make it go smoothly. It did. Your participation as partners with us in the transition to electronic filing made it possible. Everything went really well!

Electronic filing is available 24 hours a day, seven days a week. Your refunds are processed and received by you faster. Record storage is reduced and retrieval for responding to your questions is quicker and simpler. We have moved together into the future and we all benefit from these advantages of filing electronically. Thank you for partnering with us.

Mark R. Schuling
Director

Motor Fuel eFile & Pay

Iowa withholding, sales, retailer's use, consumer's use and LPG fuel taxes are now filed and can be paid electronically through the Department's eFile & Pay system.

Motor fuel tax will soon be added to this list of tax types that use the eFile & Pay system. This transition will take place in two steps as described below. Each group of filers will receive additional information by mail, including their Business eFile Number (BEN).

July 2006 - Motor fuel tax returns filed by suppliers, restrictive suppliers, importers and blenders who report less than 100,000 gallons of fuel per month will be required by statute to be filed electronically through the online eFile & Pay system. Electronic payment of the tax is also required. A direct debit payment can be made through eFile & Pay. Another electronic payment option is ACH Credit. This change will begin with the June 2006 return, which is due in July 2006. This group of filers will not submit any schedules.

September 2006 - Tentative date for motor fuel licensees, including storage facilities and terminals, reporting 100,000 gallons of fuel or more per month to begin electronic filing. They will be required by rule to file their schedules, return and payment electronically beginning with returns due in September 2006. There will be two methods available to file their schedules; Schedule Upload and EDI. We anticipate the returns will be created by the system using the data reported on the schedules. More information will be provided as we move closer to this implementation date. 

Registering for a tax permit

When applying for sales tax or withholding tax permit online, don't forget to go to the top of the second page of the application and click on “GET PIN.” Print your PIN (personal identification number) information. If you need to quit in the middle of applying, you can exit and then continue later using the PIN.    

Horses: Taxable or exempt?

Horses purchased to be used for trail rides are not exempt from sales tax as agricultural livestock or draft horses. They are taxable, as are feed and accessories for them.

2006 sales tax holiday

The 2006 Sales Tax Holiday will be held Friday and Saturday, August 4-5.

Please be aware that...

• This is an annual event on the first Friday and Saturday of August.
• The holiday does not include Sunday.
• Businesses that are open on these days are required to participate.
• Businesses cannot advertise that they will pay or otherwise absorb the sales tax on items that don't qualify.
• When completing the tax return, report all sales as gross sales and list qualifying Sales Tax Holiday sales on the "exemptions" line.

If you sell clothing or footwear in the State of Iowa , this law may impact your business.

• Exemption period: from 12:01 a.m., August 4, 2006, through midnight , August 5, 2006.
• No sales tax, including school and local option sales taxes, will be collected on sales of an article of clothing or footwear having a selling price less than $100.00.
• The exemption does not apply in any way to the price of an item selling for $100.00 or more.
• The exemption applies to each article priced under $100.00 regardless of how many items are sold on the same invoice to a customer.

More information is available online.

Vegetable seeds, plants, and fruit trees

If the purchaser of vegetable seeds, plants or fruit trees will be consuming the produce from the seeds, plants or trees, the sale is taxable in Iowa . Sales of vegetable seeds, plants, and fruit trees are exempt if the buyer will be selling the produce.

Classes About Iowa Business Taxes

Are you a new business? Or just need to know more? Our tax classes are held all year statewide.

We Make House Calls!

Gather your employees or your organization's membership. We will come to you and address your Iowa business tax concerns. This service is free of charge. Just e-mail us to contact you.

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