Iowa Admin. Code r. 701-250.8
EXAMPLE A: Business S purchases a chassis from an auto dealer for $20,000. Business S wants a lift added to the chassis. The auto dealer agrees to sell and install the lift for $15,000. The auto dealer takes the chassis to a lift dealer for purchase and installation of the lift. After the installation, Business S returns to the auto dealer to take delivery of the completed vehicle. Business S requests the auto dealer itemize the chassis price of $20,000 and the lift price of $15,000. Business S pays the auto dealer $35,000 for the complete vehicle. The chassis and lift together are a vehicle subject to registration, because both constitute the completed vehicle, and the fee for new registration is due on $35,000.
EXAMPLE B: Business T purchases a chassis from an auto dealer for $20,000. Business T wants a lift added to the chassis. However, Business T will purchase the lift from a third party and not from the auto dealer. Business T pays the dealer $20,000 for the chassis. Business T drives the chassis to a lift dealer to purchase and install a lift for $12,000. The purchase of the chassis from the auto dealer is subject to the fee for new registration because it alone constitutes the completed vehicle purchased. The purchase and installation of the lift from the lift dealer are subject to Iowa sales tax and any applicable local option tax, rather than the vehicle fee for new registration.
This rule is intended to implement Iowa Code section 321.105A as amended by 2021 Iowa Acts, Senate File 366.
Iowa Admin. Code r. 701-250.8