Is shipping in Iowa taxable?
by January 21, 2024
Please note: This blog was originally published in 2019. It’s since been updated for accuracy and comprehensiveness.
So you have sales tax nexus in Iowa and you’ve made a sales to a customer there. Should you charge sales tax on the shipping charges you charge to your customer? Today we will answer whether or not sellers will need to pay sales tax on shipping and handling in Iowa.
Is shipping taxable in Iowa?
In order for sales tax to not be charged on shipping and handling, the seller must do one of two things.
- Separately invoice the shipping and handling charges.
OR
- State the shipping and handling charges separately on the bill.
Handling Iowa shipping and handling sales tax with TaxJar
The TaxJar app defaults to the most common Iowa scenario – that shipping and handling is non-taxable. However, if your business does charge sales tax on shipping, then TaxJar’s Shipping & Handling Override allows you to update that in your state tax settings. This will make the Iowa Expected Sales Tax Due Report more accurate. This will also tell the TaxJar API to charge sales tax on Iowa shipping. Learn more about how TaxJar treats shipping and handling here. And to learn more about TaxJar and get started, visit TaxJar.com/how-it-works.
Takeaways
Iowa’s rules on shipping taxability are very straightforward. Sales tax does not have to be charged on shipping and handling in Iowa, if the seller either separately invoices for shipping and handling or states shipping and handling charges separately on the bill.
Ready to automate sales tax? Sign up for a free trial of TaxJar today
Please note: This blog is for informational purposes only. Be advised that sales tax rules and laws are subject to change at any time. For specific sales tax advice regarding your business, contact a tax advisor.
