Iowa: Sales Tax Handbook

How to appeal a sales tax audit or penalty in Iowa

In Iowa, the Department of Revenue will frequently audit business sales tax returns and may issue penalties or punishments for tardy filing, incorrect reporting, willful omissions, or other violations. Penalties can range from fines to revocation of your sales tax permit depending on the infraction.

If you disagree with a penalty or ruling made by the Iowa Department of Revenue, you have several options you can pursue in appealing their decision. This page contains basic guidelines for appealing to the Department of Revenue, to an administrative appeal body, and through the courts.

Sales Tax Statute of Limitations in Iowa

In sales tax law, the "statute of limitations" is the maximum amount of time state authorities have to investigate and begin potential audit or prosecution related to a a filed Iowa sales tax return in the event of underpayment, incorrect reportings, etc. The Department of Revenue cannot begin an audit or issue a penalty after this timeframe.

The statute of limitations in Iowa is three years from the the return filing date.

Appealing to the Department of Revenue in Iowa

If you do not agree with a penalty or decision made by the Iowa Department of Revenue, you have the right to file an appeal and ask for reconsideration. In the case of a department appeal, an official petition must be filed with the Director of Revenue within sixty days after date of notice of assessment

Administrative Sales Tax Appeals in Iowa

In the case of administrative appeal, an official petition must be filed with Department and State Board of Tax Review within thirty days after decision rendered

Judicial Sales Tax Appeals in Iowa

If all other appeal avenues fail, businesses can make a final appeal in the state court system. When working with judicial appeals, the suit must be filed with the District Court within thirty days of the date of the State Board's decision

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