Consumer’s use tax is imposed after the sale takes place and only 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 and that are for use in Iowa. Ordinarily, the retailer is responsible for collection of the tax; however, if the retailer is not required by law to collect the tax or the Iowa retailer fails to collect the tax, the purchaser is then responsible for consumer’s use tax. The purchaser must pay the use tax when ownership or control of the purchase is taken.
Use tax applies to, but is not limited to, purchases made tax free and untaxed purchases made while in another state and shipped or otherwise brought into Iowa. Anyone – individuals and businesses – who makes these types of purchases is required to pay consumer’s use tax to the Iowa Department of Revenue.
Individuals without a permit who rarely make purchases subject to consumer’s use tax should pay their tax in one of the following ways:
- Electronically through eFile & Pay
- Complete the worksheet available online and send to:
Iowa Department of Revenue
PO Box 10412
Des Moines, IA 50306-0412
Make check payable to: “Treasurer State of Iowa”
Anyone who regularly purchases merchandise from out of state for his or her own use in Iowa should register for a consumer’s use tax permit and pay the tax on a quarterly basis.