Iowa Sales Tax Guide: Rate, Rules & Filing

Iowa levies a 6% state sales and use tax. Most jurisdictions add a 1% local option sales tax, so the combined rate is 7% across most of the state.

To find the combined rate for a specific address, use our US sales tax calculator.

Iowa economic nexus applies once your gross revenue from sales into the state reaches $100,000 in the current or prior calendar year, whether or not any of it was taxable. There is no transaction-count trigger. Physical presence creates nexus immediately.

Iowa requires marketplace facilitators that meet economic nexus to register with the Department of Revenue and collect Iowa sales tax and applicable local option sales tax (LOST) on taxable retail sales sourced to Iowa, under Iowa Code § 423.14A and Iowa Administrative Code 701—207. The $100,000 gross-revenue threshold is measured by combining the facilitator's own direct Iowa sales with the sales it facilitates for marketplace sellers, and once met, the facilitator must collect on all taxable Iowa sales made through its marketplace regardless of whether an individual marketplace seller would otherwise have nexus. A remote seller that meets Iowa's sales threshold but sells into Iowa only through marketplace facilitators that are registered and collecting Iowa sales tax and LOST does not have to separately register, collect, or file an Iowa sales tax return on those facilitated sales, and generally does not need an Iowa sales tax permit for them.[9]

Iowa assigns monthly or annual filing based on tax volume. Returns are due the last day of the month following the reporting period. Sellers collecting less than $1,200 per year file a single annual return due January 31.

Iowa exempts groceries and prescription drugs. Iowa taxes SaaS as an enumerated taxable service, so SaaS is subject to the 6% state rate plus any local option tax.

Iowa buyers give the seller the Iowa Sales/Use/Excise Tax Exemption Certificate (Form 31-014) to buy for resale or another exempt use; the current revision, dated September 8, 2025, is the one to use in 2026 [5]. A blanket certificate stays valid until the buyer revokes it or 12 months pass with no purchases between the same buyer and seller. The seller keeps the certificate, and it is not sent to the Department of Revenue [5].

For the official form, multistate certificate rules and expiry, see the Iowa resale certificate guide.

Late filing carries a 5% penalty and late payment a further 5% of the tax due, plus interest from the due date.

You must file a protest within 60 days of the date on a Notice of Assessment or a refund denial [6]. A protest filed with the Department can proceed to a contested-case hearing before an administrative law judge [6].

• [1] Iowa DOR — Local Option Sales Tax (state 6% + 1% LOST)

• [2] Iowa DOR — Remote Sellers and Marketplace Facilitators (economic nexus)

• [3] Iowa DOR — Specified Digital Products and Software (SaaS taxable, business-use exemption)

• [4] Iowa DOR — Sales Tax on Food (groceries exempt)

• [5] Iowa DOR — Sales/Use/Excise Tax Exemption Certificate (Form 31-014)

• [6] Iowa DOR — Taxpayer Bill of Rights (60-day protest)

• [7] Iowa DOR — Annual Sales Tax Holiday

• [8] Iowa DOR — Business Permit Registration (GovConnectIowa)

• [9] Iowa Administrative Code Rule 701—207 — Marketplace Facilitators

Verified July 2026 against Iowa Department of Revenue published guidance.

• Does Iowa Have Sales Tax on Clothing? A Guide for Businesses
• How to File a Sales Tax Return in Iowa