Agency: Department of Revenue & Finance
Contact Person/Department: Darwin Clupper or Jerri DeVries
Tel. No.: (515) 281-3670 Darwin; (515) 281-3194 Jerri
Fax No.: (515) 281-3756
Public Schools (K-12) - Exempt
Private Schools (K-12) - Exempt
School Groups (e.g., clubs, bands, teams) - Exempt
PTAs - Exempt
PTOs - Exempt
Other parent groups - Not Exempt
Church Groups - Exempt
Youth Sports League - Not Exempt
501 (c)(3) organizations - Exempt
501 (c)(6) organizations Not Exempt
1a Are local sales and use taxes in your State applied to these groups in the same manner as State sales and use taxes are applied to these groups?Proceeds from sales made by an organization is exempt from Iowa sales and use tax if the organization making the sale or the organization in which the proceeds are donated to is exempt from tax pursuant to Internal Revenue Code section 501(c)(3) and the proceeds are used for a qualifying “educational”, “religious” or “charitable” activity.
1b Please set forth any comments including a list of groups not listed above whose fundraising activities are exempt from sales and use taxation in your State.
Proceeds from sales made by an organization is exempt from Iowa sales and use tax if the organization making the sale or the organization in which the proceeds are donated to is exempt from tax pursuant to Internal Revenue Code section 501(c)(3) and the proceeds are used for a qualifying “educational”, “religious” or “charitable” activity.
Candies and Confections - Exempt
Cookies and Other Baked Goods - Exempt
Cheese Products - Exempt
Meat Products - Exempt
Nuts, popcorn and other snack food - Exempt
Other edible items (please identify) - Exempt (bottled water and soft drinks)
Magazine subscriptions - Exempt
Paper products (e.g., calendars, cards - Exempt
stationery, books, gift wrap)
Decorative tins, baskets, other containers - Exempt
Decorative novelties (mugs, ornaments) - Exempt
Sundry items (please specify item below) - Exempt*
Clothing and accessories - Exempt
Jewelry - Exempt
Plant and seeds - Exempt
Other hard good items - Exempt **
*Most sales of tangible personal property are taxable in the initial instance.
** If they can be purchased with food stamps.
2a Are local sales and use taxes in your State applied to these products in the same manner as State sales and use taxes are applied to these products?
Yes. There is no Iowa local option use tax.
2b Please set forth any comments including a list of products not listed above that are exempt from sales and use taxation for fundraising purposes in your State.
Limits on number of fundraiser events per year
Limits on duration of fundraisers
Limits on dollar amount of each item
Limits on total amounts raised per year
Iowa law does not provide for limits of the sort described above.
There is no procedure by which a group can secure a binding statement that its fund raising sales are exempt from tax except by seeking a declaratory ruling. A copy of the rules which govern this procedure 701--X.1(17A) through 701--X.7(17A) is attached.
See answer to question 4
The fundraising group (e.g., school, PTA, church); and the purchaser of the property or user of the taxable service is also responsible for payment of uncollected tax.
Price paid by consumer to fundraising group.
See attached copy of department rule 701 IAC 17.1(422,423) which governs sales of property or services when the net proceeds to the organization are expended for charitable, educational, or religious purposes.
Last Updated: September 2005