Iowa Admin. Code r. 875-217.36
To illustrate, where an employee works 40 hours a week at a cash wage rate of $3.85 an hour and is paid $154 in cash free and clear at the end of the workweek, and in addition is furnished facilities valued at $10, no consideration need be given to the question of whether the facilities meet the requirements, since the employee has received in cash the applicable minimum wage of $3.85 an hour for all hours worked. Similarly, where an employee is employed at a rate of $5 an hour and during a particular workweek works 40 hours for which cash payment of $200 is made, the employer having deducted $30 from wages for facilities furnished, whether the deduction meets the requirement of this chapter need not be considered, since the employee is still receiving, after the deduction has been made, a cash wage in excess of the required minimum hourly wage.
Deductions for board, lodging, or other facilities may be made in workweeks even if the deductions reduce the cash wage below the minimum, provided the prices charged do not exceed the "reasonable cost" of the facilities. When items are furnished the employee at a profit, the deductions from wages are considered to be illegal only to the extent that the profit reduces the wage (which includes the "reasonable cost" of the facilities) below the required minimum.
Iowa Admin. Code r. 875-217.36
29 CFR 531.36.