§123. See §321.145.
423.45 Refunds — exemption certificates.
1.If an amount of tax represented by a retailer to a consumer or user as constituting tax
due is computed upon a sales price that is not taxable or the amount represented is in excess
of the actual taxable amount and the amount represented is actually paid by the consumer or
user to the retailer, the excess amount of tax paid shall be returned to the consumer or user
upon notification to the retailer by the department that an excess payment exists.
2.If an amount of tax represented by a retailer to a consumer or user as constituting tax
due is computed upon a sales price that is not taxable or the amount represented is in excess
of the actual taxable amount and the amount represented is actually paid by the consumer
or user to
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§123. See §321.145.
423.45 Refunds — exemption certificates.
1. If an amount of tax represented by a retailer to a consumer or user as constituting tax
due is computed upon a sales price that is not taxable or the amount represented is in excess
of the actual taxable amount and the amount represented is actually paid by the consumer or
user to the retailer, the excess amount of tax paid shall be returned to the consumer or user
upon notification to the retailer by the department that an excess payment exists.
2. If an amount of tax represented by a retailer to a consumer or user as constituting tax
due is computed upon a sales price that is not taxable or the amount represented is in excess
of the actual taxable amount and the amount represented is actually paid by the consumer
or user to the retailer, the excess amount of tax paid shall be returned to the consumer or
user upon proper notification to the retailer by the consumer or user that an excess payment
exists. “Proper”notificationiswrittennotificationwhichallowsaretaileratleastsixtydaysto
respond and which contains enough information to allow a retailer to determine the validity
of a consumer’s or user’s claim that an excess amount of tax has been paid. No cause of
action shall accrue against a retailer for excess tax paid until sixty days after proper notice
has been given the retailer by the consumer or user.
3. In the circumstances described in subsections 1 and 2, a retailer has the option to either
return any excess amount of tax paid to a consumer or user, or to remit the amount which a
consumer or user has paid to the retailer to the department.
4. a. The department shall issue or the seller may separately provide exemption
certificates in the form prescribed by the director, including certificates not made of
paper, which conform to the requirements of paragraph “c”, to assist retailers in properly
accounting for nontaxable sales of tangible personal property, specified digital products, or
services to purchasers for a nontaxable purpose. The department shall also allow the use of
exemption certificates for those circumstances in which a sale is taxable but the seller is not
obligated to collect tax from the buyer.
b. The sales tax liability for all sales of tangible personal property and specified digital
products and all sales of services is upon the seller and the purchaser unless the seller takes
from the purchaser a valid exemption certificate stating under penalty of perjury that the
purchase is for a nontaxable purpose and is not a retail sale as defined in section 423.1,
or the seller is not obligated to collect tax due, or unless the seller takes a fuel exemption
certificate pursuant to subsection 5. If the tangible personal property, specified digital
products, or services are purchased tax free pursuant to a valid exemption certificate and
the tangible personal property, specified digital products, or services are used or disposed
of by the purchaser in a nonexempt manner, the purchaser is solely liable for the taxes and
shall remit the taxes directly to the department and sections 423.31, 423.37, 423.39, 423.40,
423.41, and 423.42 shall apply to the purchaser.
c. A valid exemption certificate is an exemption certificate which is complete and correct
according to the requirements of the director.
d. The protection afforded a seller by paragraph “b” does not apply to a seller who
fraudulently fails to collect tax or to a seller who solicits purchasers to participate in the
unlawful claim of an exemption.
e. If the circumstances change and as a result the tangible personal property, specified
digital products, or services are used or disposed of by the purchaser in a nonexempt manner
or the purchaser becomes obligated to pay the tax, the purchaser is liable solely for the taxes
and shall remit the taxes directly to the department in accordance with this subsection.
5. a. The department shall issue or the seller may separately provide fuel exemption
certificates in the form prescribed by the director.
b. For purposes of this subsection:
(1) “Fuel” includes gas, electricity, water, heat, steam, and any other tangible personal
property consumed in creating heat, power, or steam.
(2) “Fuel consumed in processing” means fuel used or consumed for processing including
grain drying, for providing heat or cooling for livestock buildings or for greenhouses or
buildings or parts of buildings dedicated to the production of flowering, ornamental, or
vegetable plants intended for sale in the ordinary course of business, for use in aquaculture
production, or for generating electric current, or in implements of husbandry engaged in
agricultural production.
(3) “Fuel exemption certificate” means an exemption certificate given by the purchaser
under penalty of perjury to assist retailers in properly accounting for nontaxable sales of fuel
consumed in processing.
(4) “Substantial change” means a change in the use or disposition of tangible personal
property and services by the purchaser such that the purchaser pays less than ninety percent
of the purchaser’s actual sales tax liability. A change includes a misstatement of facts in an
application made pursuant to paragraph “d” or in a fuel exemption certificate.
c. The seller may accept a completed fuel exemption certificate, as prepared by the
purchaser, for three years unless the purchaser files a new completed exemption certificate.
If the fuel is purchased tax free pursuant to a fuel exemption certificate which is taken by
the seller, and the fuel is used or disposed of by the purchaser in a nonexempt manner, the
purchaser is solely liable for the taxes, and shall remit the taxes directly to the department
and sections 423.31, 423.37, 423.39, 423.40, 423.41, and 423.42 shall apply to the purchaser.
d. The purchaser may apply to the department for its review of the fuel exemption
certificate. In this event, the department shall review the fuel exemption certificate within
twelve months from the date of application and determine the correct amount of the
exemption. If the amount determined by the department is different than the amount that
the purchaser claims is exempt, the department shall promptly notify the purchaser of the
determination. Failureofthedepartmenttomakeadeterminationwithintwelvemonthsfrom
the date of application shall constitute a determination that the fuel exemption certificate is
correct as submitted. A determination of exemption by the department is final unless the
purchaser appeals to the director for a revision of the determination within sixty days after
the date of the notice of determination. The director shall grant a hearing, and upon the
hearing, the director shall determine the correct exemption and notify the purchaser of the
decision by mail. The decision of the director is final unless the purchaser seeks judicial
review of the director’s decision under section 422.29 within sixty days after the date of the
notice of the director’s decision. Unless there is a substantial change, the department shall
not impose penalties pursuant to section 423.40 both retroactively to purchases made after
the date of application and prospectively until the department gives notice to the purchaser
that a tax or additional tax is due, for failure to remit any tax due which is in excess of a
determination made under this section. A determination made by the department pursuant
to this subsection does not constitute an audit for purposes of section 423.37.
e. If the circumstances change and the fuel is used or disposed of by the purchaser in
a nonexempt manner, the purchaser is solely liable for the taxes and shall remit the taxes
directly to the department in accordance with paragraph “c”.
f. The purchaser shall attach documentation to the fuel exemption certificate which
is reasonably necessary to support the exemption for fuel consumed in processing. If
the purchaser files a new exemption certificate with the seller, documentation shall not
be required if the purchaser previously furnished the seller with this documentation and
substantial change has not occurred since that documentation was furnished or if fuel
consumed in processing is separately metered and billed by the seller.
6. Nothing in this section authorizes any cause of action by any person to recover sales
or use taxes directly from the state or extends any person’s time to seek a refund of sales or
use taxes which have been collected and remitted to the state.