Ag Industry Sales Tax Tips from the Iowa Department of Revenue
The Department receives many questions about how to handle Iowa sales tax related to agriculture.
A common misconception is that all goods and services purchased by a farmer are exempt from tax. That is not the case. Whether a purchase is exempt from sales tax depends on what is purchased and what it is used for.
With limited exceptions, items purchased must be directly and primarily used in agricultural production to be exempt from sales tax.
Farmers, and anyone else claiming an exemption, must complete an Iowa Sales Tax Exemption Certificate and provide it to the retailer when making a tax-free purchase.
The Department encourages farmers and other agricultural related businesses to find out more about their sales tax responsibilities by using the following resources:
- Farmers Guide to Iowa Taxes Online Publication
- Sales and Use Tax Responsibilities of Ag-Chemical Dealers, Cooperatives, Elevators, Fertilizer Dealers Online Publication
- Do Farmers Pay Iowa Sales Tax? Online PowerPoint
- Iowa Sales Tax Issues Related to Agriculture Webinar – 8/8/2013
You can also stay up to date on all sorts of tax topics through our other online outlets:
- Sign up for e-mail updates through IDR eLists
- Follow IDR on Twitter.
- E-mail Taxpayer Services at [email protected].
- Call Taxpayer Services at 515-281-3114 or 1-800-367-3388.
Content contributed by Greg Stokke, Iowa Department of Revenue.
