Sales Tax on Services in Iowa (2026) — What's Taxable

Enumerated list — 73 services

Yes, for a long list of them. The Department of Revenue states the rule as "unlike tangible personal property, which is subject to sales/use tax unless specifically exempted by Iowa law, services are subject to sales/use tax only when specified by Iowa law" — and Iowa Code section 423.2(6) then specifies 73 of them, lettered a. through bu., taxed at the 6% state rate plus any local option tax. That list is the longest of any enumerated state on this site, and it reaches ordinary consumer and back-office services that Texas, Tennessee, and Washington leave alone: barber and beauty, pet grooming, dating services, reflexology, investment counseling, and software as a service are all named in the statute.

• Repair of nearly everything — vehicle, boat, motor, motorcycle, farm implement, machine, office and business machine, household appliance, television and radio, jewelry and watch, gun and camera, shoe, tin and sheet metal, furniture, rug, carpet and upholstery, and roof, shingle and glass repair are each separately named
• Personal and grooming services — barber and beauty, tanning beds or salons, pet grooming, reflexology, and Turkish baths, massage and reducing salons (excluding services provided by massage therapists licensed under chapter 152C)
• Property and premises work — janitorial and building maintenance or cleaning, lawn care, landscaping and tree trimming and removal, painting, papering and interior decorating, pipe fitting and plumbing, electrical and electronic repair and installation, carpentry repair and installation, excavating and grading, and termite, bug, roach and pest eradicators
• Financial and staffing services — investment counseling, service charges of all financial institutions, executive search agencies, and private employment agencies (excluding placements where the principal place of employment will be outside Iowa)
• Software and digital services — software as a service; video game services and tournaments; information services; storage of tangible or electronic files, documents or other records; and services arising from installing, maintaining, servicing, repairing, operating, upgrading or enhancing specified digital products or software sold as tangible personal property
• Telecommunications and media — pay television including streaming video, video on-demand and pay-per-view, and telephone answering service
• Transportation, storage and parking — personal transportation service including taxis, driver service, ride sharing, rides for hire and limousine service; parking facilities; wrecker and towing; and storage of household goods, mini-storage and warehousing of raw agricultural products
• Recreation and venues — golf and country clubs and all commercial recreation, dance schools and dance studios, and campgrounds
• Cleaning and garment services — dry cleaning, pressing, dyeing and laundering (excluding the use of self-pay washers and dryers), alteration and garment repair, sewing and stitching, and vehicle wash and wax

• Accounting, legal, architectural, engineering, and general management consulting services are not among the 73 named categories and so are not subject to Iowa sales tax
• Test laboratories are taxable, but section 423.2(6)(bc) excludes tests on humans or animals and excludes environmental testing services
• Massage performed by a massage therapist licensed under Iowa Code chapter 152C is carved out of the otherwise-taxable "Turkish baths, massage, and reducing salons" category
• Private employment agency services for placing a person in employment whose principal place of employment is to be located outside Iowa
• Self-pay washers and dryers, carved out of the laundering category by name
• Sewage services for residential customers — section 423.2(6)(at) reaches only sewage services for nonresidential commercial operations

Partly, and Iowa is one of the few states where the answer is not a flat no. Investment counseling, service charges of all financial institutions, executive search agencies, and private employment agencies are all named in Iowa Code section 423.2(6), so those fees carry the 6% tax. Accounting, legal, architectural, engineering, and general management consulting are not named and stay outside it. Read the list rather than reasoning from the profession: Iowa draws the line inside the professional-services category, not around it.

Iowa is an enumerated state that behaves nothing like the other enumerated states on this site. Texas names sixteen categories and Florida names three; Iowa names 73, lettered a. through bu. in one subsection. The practical effect is that the default expectation flips: on most service invoices in Iowa the useful question is not “is my service on a short list?” but “can I find the letter that covers it?”

Software as a service is on the list by name. Section 423.2(6)(bu) reads simply “Software as a service.” That is unusually blunt — most states reach SaaS through a definition of prewritten software or a Department ruling, and argue about it. Iowa enumerated it, along with video game services and tournaments (bt.) and information services (br.). If you sell subscription software into Iowa, treat it as taxable and look for an exemption rather than the other way round. See the Iowa SaaS page for the nexus and registration side of that.

Barber and beauty services are taxable here. Section 423.2(6)(g) names them outright, which is the opposite of Tennessee, where the Department of Revenue uses cosmetology and barber services as its example of a non-taxable service. Pet grooming (am.) and tanning (az.) are taxable too. If you run a salon or a grooming business across state lines, this is the single field where the wrong assumption costs the most — our beauty-salon industry guide works the same question by trade rather than by state.

Repair is enumerated object by object, not as a concept. The statute does not say “repair services”; it names vehicle repair, boat repair, motor repair, farm implement repair “of all kinds”, machine repair “of all kinds”, gun and camera repair, jewelry and watch repair, and about a dozen more separately. Iowa also taxes building materials sold to contractors as retail sales of tangible personal property under section 423.2(1)(b), so construction work runs on its own set of rules rather than on the service list.

Rate. Section 423.2(1) imposes 6% on the sales price, and section 423.2(5) applies the same 6% to the sales price from the furnishing of services. Local option sales tax under Iowa Code chapter 423B applies on top in most jurisdictions.

Every statement on this page traces to one of the official sources below. date_retrieved: 2026-07-31.

• Iowa Code § 423.2 (2026) — Tax imposed, including the enumerated taxable services in subsection 6
• Iowa Department of Revenue — Iowa Sales and Use Tax: Taxable Services

Iowa sales/use tax nexus and economic nexus threshold: a remote seller or marketplace facilitator must register, collect, and remit Iowa sales tax only if its gross revenue from Iowa sales is $100,000 or more in a calendar year. Iowa originally enacted a $100,000-or-200-transaction test effective January 1, 2019 (Senate File 2417) but eliminated the 200-transaction threshold effective July 1, 2019 (House File 779), so the current trigger is sales-only. The $100,000 figure counts all Iowa revenue, including exempt sales, wholesale sales, sales for resale, and sales for which a marketplace facilitator collected the tax. Marketplace facilitators meeting the threshold collect and remit on behalf of their marketplace sellers. Iowa imposes a 6% state sales tax plus a 1% local option sales tax in most jurisdictions. Iowa Department of Revenue source data last retrieved 2026-06-14.

Read the full Iowa overview for thresholds, filing frequency, marketplace facilitator rules, and registration links. Use the nexus calculator to check whether you have crossed the threshold. For background on the post-Wayfair economic nexus framework, see the pillar guide.

The general rule above is easier to apply against a real trade. These national industry guides walk the same question for three service verticals, and each one names the state-by-state differences that decide whether a given invoice is taxable:

• Salon and barber sales tax guide
  haircuts, nail services, and retail product sales — the clearest case of a personal service whose taxability flips from state to state.
• Restaurant and food service sales tax guide
  prepared food, dine-in versus takeout, delivery, and gratuities, where the service and the product are billed together.
• Construction contractor sales tax guide
  labor on real property, materials, and the residential/nonresidential split that decides taxability in several states.

• Iowa · SaaS
  Software-as-a-service sales tax rules
• Iowa · Digital Products
  Sales tax on digital downloads, eBooks, courses, streaming
• Iowa · Thresholds
  Economic and transaction nexus thresholds

Compare Iowa's services rules with nearby and similar states' services sales tax guides:

• California Services sales tax
  Services nexus, taxability, and filing rules for California.
• Florida Services sales tax
  Services nexus, taxability, and filing rules for Florida.
• Hawaii Services sales tax
  Services nexus, taxability, and filing rules for Hawaii.
• Illinois Services sales tax
  Services nexus, taxability, and filing rules for Illinois.
• Maryland Services sales tax
  Services nexus, taxability, and filing rules for Maryland.
• New Jersey Services sales tax
  Services nexus, taxability, and filing rules for New Jersey.