Message from Director Ralston
you for taking time to read another edition of the Department of
Please allow me to call attention to changes
in Iowa’s sales and use tax laws. These changes, which
took effect July 1 of this year, make possible Iowa’s participation
in the national Streamlined Sales Tax project. The project is an
effort by businesses and states to provide uniformity of sales
and use tax laws and administration among states. One important
goal of the project is to ensure the collection of taxes already
due related to remote purchases, such as those made through catalogs
or over the Internet.
Iowa, the changes had two primary areas of focus. One related to definitions
of food and other items. Another changed Iowa’s status from origin-based
sourcing for sales and use tax to destination-based sourcing. The sourcing
change means that retailers are asked to calculate and collect local
option taxes based on the destination of the sale. As you can imagine,
this change regarding destination does not have any impact for over-the-counter
sellers, such as convenience stores and similar establishments.
policy makers and we at the Department of Revenue know this is a big
change, and we have taken several steps to aid retailers and remote
sellers. First, our department Web site has several tools, such as a
list of all the taxing jurisdictions in Iowa (Excel), and their
applicable tax rates. Another database, which is interactive and downloadable,
will soon be available from our site, and it will actually calculate
the correct tax for a particular jurisdiction automatically.
in an effort to be of assistance, I sent a letter to all Iowa sales
and use tax permit holders in July which outlines flexibility related
to the changes. The department knows these changes can be confusing
and troublesome. My letter explains our department’s policy of
service, not sanctions; we want to work with retailers to implement
these changes together. In fact, for a transition period of six months
(July 1 to December 31, 2004), no penalties will be imposed or other
actions taken against retailers who exhibit a good faith effort while
trying to comply with the new laws. Retailers all across Iowa have
implemented the changes that started July 1, and we continue to work
with them during this transition period.
you have any questions or comments, please don’t hesitate to
contact us. You can contact us by e-mail or
call toll-free at (800) 367-3388 (Iowa, Omaha, Rock Island, Moline).
And as always, thank you very much for your efforts to comply with
Iowa’s tax laws. - Michael Ralston
File & Pay
begins January 2005
department will launch its new File & Pay system
of filing Iowa withholding for tax periods that begin on January 1,
2005. The system for sales and use taxes is expected to follow in July
2005. Filing and payment options will be available online and by telephone.
Paper returns will no longer be provided, although paper payment vouchers
will still be sent to most taxpayers.
will discover that filing and paying electronically is a better way
to do business with the department.
waiting for paper returns in the mail
to filing and paying system 24/7
to filing and payment history 24/7
that returns and payments are received
- Secure and confidential
transmission of information
- Ability to schedule
payments in advance
information explaining how the system works will be sent to each withholding
agent prior to filing deadlines.
taxpayers have already proven they are ready to take this step. Sixty
percent filed their Iowa individual income tax forms electronically
last year. That's more than 800,000 Iowa taxpayers.
of Attorney forms
Power of Attorney forms are now accepted by the Iowa Department of
Revenue.You must write a statement on the Federal form that indicates
you are submitting it for use with State of Iowa forms. The statement
needs to be initialed by the taxpayer. Power of Attorney forms should
be mailed to Registration Services, Iowa Department of Revenue, PO
Box 10465, Des Moines IA 50306-0465; or faxed to 515/281-3906.
Iowa Centralized Employee Registry Form
An employer doing
business in Iowa who hires or rehires an employee must send the Centralized
Employee Registry Reporting form and/or the Contractor Reporting Form
within 15 days of the hire or rehire date to the Iowa Department of
Human Services (IDHS).
The Iowa Department
of Human Services (IDHS) has a Web site for completing and submitting
the Centralized Employee Registry Reporting form. The Web site is an
easy, paperless means of filing this required information. This form
may also be faxed or mailed to IDHS.
At this time, the
Web site is not able to accept the Contractor Reporting Form. This
needs to be either faxed or mailed to IDHS.
These forms may be
- Mail - CER, PO
Box 10322, Des Moines, IA 50306-0322
- Fax - 1-800-759-5881
or Locally 515-281-3749
site - (Centralized Employee Registry Reporting form)
- CD/diskette -
mail to CER, PO Box 10322, Des Moines, IA 50306-0322 (Please contact
the CER Hotline for file layout)
Paper forms are available
online as follows:
- Centralized Employee
Registry Reporting form: the
top portion of the Iowa W-4 provided
by the Iowa Department of Revenue.
Reporting Form (470-3100) provided by the Iowa Department of
The Centralized Employee
Registry Hotline number is 515-281-5331.
tax class schedules set
class schedule is available on the department's Web site. You
will find opportunities to learn about Iowa withholding, sales, and
local option taxes. Most classes are held at community colleges and
a small fee is charged by the college. If you need continuing education
units, our classes qualify! Interested in a custom or private class
at your business? Use our map to
contact the Tax Specialist serving your area.
option sales taxes
local option sales taxes may become effective twice each year: July
1 and January 1. New jurisdictions for January 1, 2005, will be posted
on the department's Web site by the end of November.
- motel tax
jurisdictions (Excel format) will enact the hotel-motel tax on