<%@LANGUAGE="JAVASCRIPT" CODEPAGE="1252"%> Iowa Department of Revenue electronic newsletter: Iowa Tax eNews
graphic for Iowa Department of Revenue Tax eNews electronic newsletter
December 2012 ------------------------------------------------------------------------------------------------------------------------------------------------

In This Issue

Online fillable forms can now be saved

Many of the online forms on the Department's forms index page are fillable. If using Adobe Reader Version 11, the form can now be saved after it is filled out.  Update Adobe Reader for free at this link.  The Department hopes this will be a welcome feature for taxpayers.

Income tax e-filing begins January 22

Iowa individual income tax e-filing is scheduled to begin January 22, 2013. Taxpayers should be aware that any delay in federal e-filing will affect Iowa and may push the start date back.

Expanded Instructions for 2012 IA 1040 available online soon

Our 2012 IA 1040 Expanded Instructions will soon be posted online; please watch our individual income tax forms page. Be sure to read What's New once the E.I. is posted. The 2012 printer-friendly PDF version is also coming soon.

Redesigned Rent Reimbursement forms to be mailed in January

The 2012 Rent Reimbursement Claims will be mailed during the first week of January to those individuals who filed a 2011 form.  The forms sent in this mass mailing will be pre-printed with the claimant's name, address and other important information.  It is to the claimant's benefit to use the pre-printed form whenever possible as the information contained on it speeds processing.

Blank 2012 Rent Reimbursement Claims (not pre-printed) will be available on our Web site Monday, 1/14/13.  On that date, they will also be available at the Taxpayer Services office located on the fourth floor of the Hoover State Office Building in Des Moines.

The form has been redesigned for 2012 to make it easier to complete.  In addition to other changes, the calculation of the reimbursement amount is now optional for the claimant.  If the claimant chooses, the Department will make that calculation for them. The new form also includes a QR code that lists resources to assist with filing a claim.

The Rent Reimbursement program is available to Iowa residents whose total household income is less than $21,335 and one of the following applies:

  • 65 years of age or older by December 31, 2012, or
  • Totally disabled and 18 years of age or older by December 31, 2012.

In addition, the individual must be renting housing in a building subject to property tax.

Iowa local option sales tax changes effective January 1, 2013

To see the latest changes in Iowa jursdictions, follow this link.

Don't forget consumer's use tax

The Department reminds those who made purchases on Black Friday, Cyber Monday, or throughout the Holiday Season, of their responsibility to pay 6% Iowa consumer’s use tax on those purchases if tax was not collected by the seller.  Consumer’s use tax is imposed on goods and services that have not yet been subjected to sales tax.  In most cases, these are purchases made from an out-of-state supplier not collecting Iowa tax, such as:

  • online purchases
  • mail-order catalogs
  • television shopping programs
  • toll-free 800 numbers 

Please see our Use Tax - Everyone's Responsibility Web page for additional details on why and how consumer’s use tax should be paid.    

Changes to Iowa Tax Research Library announced

In November, the Department announced a change to the Iowa Tax Research Library (ITRL).  As of 11/19/2012, the ITRL no longer includes statutes or rules and regulations.  The current versions of the statutes and rules are available on the Iowa Legislative Web site, thus there was no longer a need to maintain a separate listing of them on the ITRL. 

While the Department understands it may be less convenient to access a different Web site to obtain statutes and rules, we believe it is a better service to taxpayers as there was an inherent time delay in updating the ITRL when changes were made to a statute or rule.  By using the Legislative Web site, taxpayers are always assured of accessing the most up-to-date version of any statute or rule they are seeking.     

January 2013: Department offers extended customer service hours

The Iowa Department of Revenue is pleased to announce expanded telephone customer service hours during the month of January 2013, from 8:00 am to 4:45 pm, Monday through Friday.  Walk-in and e-mail customers will continue to be served Monday through Friday, 8:00 am to 4:30 pm.

Customers can reach the Department at:

  • 515-281-3114 / 1-800-367-3388
  • idr@iowa.gov
  • 1305 E. Walnut, 4th Floor, Hoover State Office Building, Des Moines, Iowa   

Telephone service hours will return to normal, 8:00 am to 4:15 pm, on February 1, 2013.

E911 surcharge

Beginning January 1, 2013, a new E911 surcharge will be imposed on the purchase of prepaid wireless telecommunication service.  The surcharge is collected from the consumer by retailers.

Prepaid telecommunication service includes:

  • Prepaid wireless telephone minute cards;
  • Prepaid phones that include minute plans; or
  • Prepaid wireless service in any other form.

If you sell prepaid wireless telecommunication service, you will be required to collect 33 cents per retail transaction.  “Retail transaction” means the purchase of prepaid wireless telecommunications service from a seller for any purpose other than resale.  If more than one separately priced item of prepaid wireless calling service is purchased by an end user, each item purchased constitutes a separate retail transaction.  For example, if a seller sells two prepaid wireless phone calling cards to one consumer, two retail transactions have occurred. 

There are limited exceptions to this requirement.  If a minimal amount of prepaid wireless telecommunications service is sold with a prepaid wireless device for a single, nonitemized price, the seller may elect not to apply the prepaid wireless surcharge to the retail transaction.  A minimal amount of service is denominated as ten minutes or less, or five dollars or less. 

Retailers are permitted to keep 1 cent from each retail transaction.

The remaining 32 cents per transaction must be paid to the Iowa Department of Revenue when filing the Iowa sales tax return through eFile & Pay at: www.iowa.gov/tax

End-of-year reminders for withholding filers

With the end of the year approaching, you will want to file your Iowa Verified Summary of Payments Report (VSP) through eFile & Pay. The 2012 VSP must be filed by February 28, 2013.

Iowa does not require you to send in copies of the W-2s or 1099s. Employers are, however, required to keep copies for four years.

The federal government requires employers to provide W-2s and 1099s to employees no later than January 31, 2013, for tax year 2012. W-2s and 1099s are federal forms and can be obtained through the IRS Web site, or by calling the IRS at 1-800-829-3676, or by purchasing them through an office supply company.

The Iowa withholding tax tables will NOT change for 2013. Please continue to use the current tables, which became effective April 1, 2006.

The Iowa W-4 for 2013 is now online.

Snow removal - Applying sand, salt, ice-melt

Snow removal is not subject to Iowa sales tax. The service of applying sand, salt, or ice-melt is likewise not taxable. However, the materials applied – sand, salt, ice-melt – are taxable products.  Sales tax is due on these materials.

  • When the snow removal business applies these materials for their customer and does not make a separately itemized charge for them, that business is the consumer of the materials and owes sales tax to its supplier when they are purchased.  No tax is charged to the snow removal business’ customer for services or materials.
  • In some cases, the snow removal business may separately itemize charges to their customer for the materials. If so, the business may be able to purchase the materials for resale and not pay sales tax to its supplier when three conditions are met.
    1. The business and its customer must agree that the product is being sold separately from the service, and
    2. The product must be sold to the customer in a definite form or amount and with a specific price attached, and
    3. The cost of the product must be itemized on the bill.  

When purchasing products for resale, a valid Sales Tax Exemption Certificate (pdf) will be provided by the snow removal business to the supplier who sells them the materials.  In this situation, the snow removal business must charge sales tax to their customer on the materials, but not on the services.

Can you eFile for free?

Are you 25 or younger?

Are you 65 or older?

Are you in the military?

Do you qualify for earned income credit?

Find out at www.iowa.gov/tax!

File your federal & Iowa returns at the same time from links on our Web site.

Get your refund in days instead of weeks.
eFiling is fast, safe, and easy.