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Iowa car sales tax at a glance
| Iowa | |
|---|---|
| Tax | fee for new registration (one-time registration fee in lieu of sales tax) |
| State rate | 5% |
| Counties and cities add tax | No |
| Trade-in lowers the tax | Yes, tax is on the price minus the trade |
| Leases | Tax on all the payments, due at signing |
| Dealer doc fee cap | $180 |
Checked on the state's official sources on 2026-11-02. Rates change; the state's revenue department has the last word.
How to work out Iowa sales tax on a car
Multiply the taxable price by the rate. In Iowa the trade-in comes off first.
A $30,000 car with a $5,000 trade: $25,000 x 5% = $1,250 at the state rate.
$10 plus 5% of the purchase price, paid to the county treasurer at first registration/title; rebates applied to the price are excluded. Local option sales taxes do not apply to vehicles.
Trade-ins
A vehicle traded to a dealer that will resell it is excluded from the purchase price, if the same person is on both titles (spouses, lineal family and cosigner cases also qualify) (Iowa Code 321.105A(2)).
Leasing a car in Iowa
Tax on all the payments, due at signing. Iowa: for leases of 6 months or more, the lessor pays $10 plus 5% of the lease price (total of lease payments plus down payment, excluding listed fees, insurance, rebates and refundable deposits) when titling (Iowa Code 321.105A(3)). The lease calculator uses Iowa's method when you pick the state.
Dealer doc fees
Iowa Code 322.19A: documentary fee may not exceed $180 per vehicle; must be included in advertised prices with a required notice.