Senate File 4 - Introduced
SENATE FILE
BY KETTERING
Passed Senate, Date Passed House, Date
Vote: Ayes Nays Vote: Ayes Nays
Approved
A BILL FOR
1 An Act relating to the taxation of casual sales of vehicles,
2 aircraft, and watercraft under the state sales tax, providing
3 refunds, and including effective and retroactive applicability
4 date provisions.
5 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
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PAG LIN
1 1 Section 1. Section 423.3, subsection 39, Code 2007, is
1 2 amended to read as follows:
1 3 39. The sales price from "casual sales".
1 4 "Casual sales" means:
1 5 a. Sales of tangible personal property, or the furnishing
1 6 of services, of a nonrecurring nature, by the owner, if the
1 7 seller, at the time of the sale, is not engaged for profit in
1 8 the business of selling tangible personal property or services
1 9 taxed under section 423.2.
1 10 b. The sale of all or substantially all of the tangible
1 11 personal property or services held or used by a seller in the
1 12 course of the seller's trade or business for which the seller
1 13 is required to hold a sales tax permit when the seller sells
1 14 or otherwise transfers the trade or business to another person
1 15 who shall engage in a similar trade or business.
1 16 c. Notwithstanding paragraph "a", the sale, furnishing, or
1 17 performance of a service that is of a recurring nature by the
1 18 owner if, at the time of the sale, all of the following apply:
1 19 (1) The seller is not engaged for profit in the business
1 20 of the selling, furnishing, or performance of services taxed
1 21 under section 423.2. For purposes of this subparagraph, the
1 22 fact of the recurring nature of selling, furnishing, or
1 23 performance of services does not constitute by itself engaging
1 24 for profit in the business of selling, furnishing, or
1 25 performance of services.
1 26 (2) The owner of the business is the only person
1 27 performing the service.
1 28 (3) The owner of the business is a full=time student.
1 29 (4) The total gross receipts from the sales, furnishing,
1 30 or performance of services during the calendar year does not
1 31 exceed five thousand dollars.
1 32 The exemption under this subsection does not apply to
1 33 vehicles subject to registration, aircraft, or commercial or
1 34 pleasure watercraft or water vessels.
1 35 Sec. 2. REFUNDS. Refunds of taxes, interest, or penalties
2 1 which arise from claims resulting from the amendment to
2 2 section 423.3, subsection 39, in this Act, for the casual sale
2 3 of vehicles subject to registration, aircraft, or commercial
2 4 or pleasure watercraft or water vessels occurring between July
2 5 1, 2005, and the effective date of the section amending
2 6 section 423.3, subsection 39, in this Act, shall be limited to
2 7 twenty=five thousand dollars in the aggregate and shall not be
2 8 allowed unless refund claims are filed prior to October 1,
2 9 2007, notwithstanding any other provision of law. If the
2 10 amount of claims totals more than twenty=five thousand dollars
2 11 in the aggregate, the department of revenue shall prorate the
2 12 twenty=five thousand dollars among all claimants in relation
2 13 to the amounts of the claimants' valid claims.
2 14 Sec. 3. EFFECTIVE AND RETROACTIVE APPLICABILITY DATES.
2 15 This Act, being deemed of immediate importance, takes effect
2 16 upon enactment and applies retroactively to July 1, 2005.
2 17 EXPLANATION
2 18 Current sales tax law provides for an exemption for casual
2 19 sales. In the 2005 Session a provision was enacted that
2 20 provided that the exemption for casual sales did not apply to
2 21 sales of vehicles subject to registration, aircraft, and
2 22 commercial or pleasure watercraft or water vessels. This
2 23 provision took effect July 1, 2005. This bill strikes that
2 24 provision and makes the strike retroactive to July 1, 2005.
2 25 The bill also limits, to $25,000, the aggregate amount of
2 26 refunds as a result of the retroactive applicability date.
2 27 The bill takes effect upon enactment and applies
2 28 retroactively to July 1, 2005.
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