Iowa Tax Research Library Update

The Iowa Department of Revenue has updated the Iowa Tax Research Library. A brief document summary of the addition follows. Visit the What's New section to access the full document.

Date Updated:  6-14-2021

Tax Type: Sales and Use Tax

• STUDY.COM, LLC (DO) (2021)
  
  Petitioner, an operator of an online virtual learning platform, offers for sale various learning plans. The learning plans are all accessible through the online platform. Each learning plan is paid for on a monthly subscription basis. Petitioner inquired whether its various learning plans were subject to sales tax under Iowa Code chapter 423. The Director found that all of Petitioner's learning plans are subject to Iowa sales tax because they all constitute software as a service pursuant to Iowa Code section 423.2(6)(bu). The Director also found that certain learning plans may be exempt from sales tax if the requirements of the commercial enterprise exemption under Iowa Code section 423.3(104)(a) are satisfied. Petitioner also inquired about the taxability of its revenue generated from Internet advertising. The Director found that Internet advertising is not a taxable enumerated service under the Iowa Code and is therefore, not subject to Iowa sales tax.

The mission of the Iowa Department of Revenue is to serve Iowans and support state government by collecting all taxes required by law, but no more.