Answers to Your Questions About eFile & Pay

eFile & Pay

Getting Started

Am I required to file business tax returns electronically?

Paper returns are not provided; therefore, eFile & Pay is the best option for filing your withholding, sales, retailer's use, and consumer's use returns. Fuel tax returns are required by law to be filed electronically.

When can I set up my eFile & Pay account?

Once you receive your Business eFile Number (BEN), you can go online to set up your account. You cannot use the system without this number if you are a business tax filer. If you have not been issued a BEN by the due date of a return, the Department will accept a one-time paper filing of that return.

Can I file any of my returns electronically for free?

Yes. All returns are free of charge through eFile & Pay.

User ID / Password

How are User IDs assigned?

The first person in your business to access the system is assigned a User ID of 0001 and automatically becomes the "administrator." This person also creates the initial login password.

What if I am locked out?

If User 0001 is locked out of the system and unable to answer the security hint questions, contact the Department at (515) 281-3114. If any other users are locked out, they should contact the administrator (User 0001).

Filing a Return

When I file a return showing no sales and, therefore, no tax, do I send a payment voucher showing a zero payment?

No, do not send a payment voucher for zero returns.

If I choose “Save and Finish Later” when filing a return, how do I go in later and retrieve the return?

Go into the eFile & Pay system and log in with your BEN, User ID, and Password. In the top section of the Main Menu, click on the tax type of the saved return. For example, if your saved return was for withholding, click on Withholding and you will receive a message that says, “You have a saved return, do you wish to finish this return?”

Saved returns remain in the system for seven (7) days only.

Rounding

When the amount is 50 cents or more, round up. When the amount is 49 cents or less, round down.

Do I have to pay the rounded amount?

When making a payment at the same time you file the deposit or return, the eFile & Pay system will automatically enter the rounded amount shown as the payment amount. Paying the rounded amount is acceptable. However, you may enter the exact amount in place of the rounded amount shown by the system.

Local Option Sales Tax: Sales Tax and Retailer's Use Tax Returns

Who is required to complete this portion of the return?

Everyone with sales reported on line 5 must complete this schedule, even if no local option tax is due.

How do I report the tax?

To report Local Option Sales Tax and/or Sales by County, click on the LOCAL OPTION / SALES ENTRY SCHEDULE button located above line 6b. Report your taxable sales (line 5) by county in the Sales by County column. This will not affect the total tax due.  Report your taxable sales subject to Local Option Tax in the Taxable Sales Local Option column. The system will populate 1% on line 6b of the return.

If you have numerous entries to make, click CALCULATE every 15 minutes to save your entries.

Local option rates are available here.

Separate rules apply for utility companies.

If you are a utility company, please read this letter. (pdf)

Amending a Return

How do I amend a return?

Withholding and Sales/Use

If you discover an error on a previously-filed withholding or sales/use return, you can amend it through eFile & Pay within the 3-year statute of limitations. This applies to quarterly and annual returns. Monthly deposits cannot be amended.

After you log in and select the permit you wish to amend, select the tax period by clicking the drop down arrow to the right of the default tax period.  If you are a quarterly filer, you can choose any of the twelve most recent quarters to amend, in addition to the current quarter. 

If you paid using ePay (free direct debit) and are amending the same day, you must cancel the payment. Amending the return will not stop the ePayment. If you file an amended return and the payment has already been deducted from your bank account, include the payment as a deposit.

If additional payment is due, it can be made electronically. Taxpayers who are allowed to pay by mail may send a paper check.

Motor Fuel Tax

An error on a fuel tax return can be corrected by filing an amended monthly return within the 3-year statute of limitations for the month in which the error occurred. An overpayment on an amended fuel tax return will be refunded. If additional payment is due, payment must be made electronically through ePay or ACH Credit.

Refunds

What if I overpaid? How do I get a refund?

Withholding Refunds

You cannot use form IA 843.

Overpayment from amending a return from the prior calendar year: A refund will be issued.

Overpayment from amending a return In the current calendar year: A refund or credit carryforward may be requested. In eFile & Pay you will be taken to a screen and choose to have the refund mailed to you or to have the overpayment applied to the next filing period.

Sales/Use Refunds

If you have overpaid sales/use tax, you may amend the appropriate return in eFile & Pay, or you may complete Iowa Department of Revenue Claim for Refund form IA 843.

In eFile & Pay, if the amended return results in a refund, you will be taken to a screen and choose to have the refund mailed to you or to have the overpayment applied to the next filing period.

Motor Fuel Tax Refunds

A refund of an overpayment on a previously-filed fuel tax return must be claimed by filing an amended fuel tax monthly return for that period.

All

Refunds will be issued if requested on a correctly-filed original tax return based on the information on that original return; an amended return is not required in that case.

Penalty for Not Filing / Paying

Is there a penalty imposed for not timely filing returns and paying tax?

Penalty for failure to timely file = 10% of the tax due, if 90% of the tax is not paid by the due date.

Penalty for failure to timely pay the tax due = 5% of the tax due, if 90% is not paid by the due date. If both penalties apply, only the 10% penalty is charged.

Motor Fuel Tax Only

In addition to the penalties described above, the following two penalties also apply to fuel tax:

Interest for Late Filing

If I am filing late, how do I compute the interest due?

eFile & Pay will automatically calculate interest due if the return is filed late. Interest is computed on an entire-month basis, not daily.

Interest Rates

Electronic Payments

Paying electronically makes your transaction paperless. If you pay electronically, you do not send a payment voucher.

What are the electronic payment options?

Electronic payment options include:

ePay

ePay is free direct debit through eFile & Pay. Payment must be made by 4 p.m. CT on the due date to be timely.

NOTE:  IDR will not accept a payment from an account outside the United States.

Additional ePay Information

Credit / Debit Card

A link to the credit / debit card vendor is provided in eFile & Pay. Payment must be made by 4 p.m. CT on the due date to be timely.

Please note that the vendor charges a 2.5% fee for use of a credit card and $3.95 on payments of $1,200 or less when using a debit card.

The credit card option is not currently available for LPG or motor fuel tax payments.

Additional Credit / Debit Card Information

ACH Credit

ACH Credit is made through your financial institution. Payment must be made on the business day before the due date to be timely.

Additional ACH Credit Information

Do I have to pay electronically?

If you were required to pay electronically prior to eFile & Pay, you still are. All Iowa fuel taxes, including LPG, must be paid electronically through ePay or ACH Credit.

If you are not required to pay electronically, you may pay by check and use a payment voucher. If you pay electronically, you do not send a payment voucher.

Is there a charge if I pay my balance due online?

ePay is free to use. However, if you choose to pay by credit card, a convenience fee will be charged by a third-party vendor.

Can I make a direct debit (ePay) payment on a return before I file it?

No. We require a return to be completed through eFile & Pay prior to an ePayment being submitted.

Can I make multiple payments on one return?

Yes.

How far into the future can I set up a payment?

When a return is timely filed, the payment can be set up to occur on the due date, no matter what day the return was filed. You cannot file future returns beyond the current quarter for withholding or sales/use tax.

If I choose to pay by ePay, when does the transaction need to be submitted to be considered timely?

ePayments must be transmitted by 4 p.m. CT on the due date to be considered timely. If you pay electronically, you do not send a payment voucher.

Can I cancel an ePayment?

Yes. Payments may be canceled at least one business day before payment date, or before 3 p.m. CT on the day the payment was confirmed. To cancel a current or delinquent transaction on the same day it was initiated, the cancelation must be completed that same day by 3 p.m. CT.

What if my bank information changes?

If it changes, you simply enter the new information the next time you schedule a payment.

If I choose to pay by ACH Credit, when does the transaction need to be submitted to be considered timely?

The transaction must be initiated through your own bank on the business day prior to the due date. If you pay by ACH Credit, you do not send a payment voucher.

How do I cancel a credit / debit card payment?

Credit / debit card payments are made through Official Payments Corp. Once your payment information is submitted, the transaction is complete.

Can a credit / debit card payment be reversed?

To reverse a payment, you must contact Official Payments. If approved by the Department, the credit / debit card payment is credited for the payment and the fee.

Pay by Check

Can anyone make payments by check?

No. If you were required to pay electronically prior to eFile & Pay, you still are. All Iowa fuel taxes, including LPG, must be paid electronically through ePay or ACH Credit.

What do I do if I do not receive my payment vouchers for paying business taxes?

You may print your payment voucher from the eFile & Pay system. Your computer system must have Internet Explorer version 5.5 or newer and Acrobat Reader version 6.0.1 or newer. Certain filing frequencies / filing methods are not mailed payment vouchers, because a payment voucher can be printed from the confirmation page.

Certain filing frequencies / filing methods are not mailed payment vouchers, because a payment voucher can be printed from the confirmation page. If you do not receive payment vouchers by mail and have questions, please call us at (515) 281-3363 for new vouchers or e-mail us Please be sure to provide the tax I.D. number, business name and address, tax period, your Business eFile Number, your name and telephone number, and other pertinent information.

Payment vouchers are not available on the Tax Fax system or on the Web site.

Motor Fuel Tax

Payment vouchers are not provided to any Iowa fuel tax licensees, including LPG filers. Motor fuel licensees should contact the Department at 515-281-6447 or 515-242-6033 if they have questions about the requirement to pay fuel taxes electronically.

When I file a return showing no sales and, therefore, no tax, do I send in a payment voucher showing a zero payment?

No, do not send in a payment voucher for zero returns.

If I mail a payment on the due date, is it considered timely?

Yes, if it is postmarked on or before the due date, no penalty is charged.

Unable to Print Payment Voucher

What should I do if the payment voucher will not print?

If you are paying by check and unable to print the voucher from eFile & Pay, you may need to change your Internet browser.

If you accessed eFile & Pay using the Internet Explorer browser, please consider downloading the Firefox browser. You can download the Firefox browser for free at http://www.mozilla.org/products/firefox/.

If you want to avoid the hassle of mailing a payment voucher, please consider paying electronically using the ePay option. ePay is a free electronic payment option available through the eFile & Pay system.

Also see eFile & Pay - Browser Requirements.

Due Date Reminders by E-mail

Please see our E-mail Policy.

When are the reminders sent?

Monthly filers receive a reminder each month and each quarter.

Quarterly filers receive a reminder two weeks before the due date.

How do I sign up to receive e-mail reminders?

If you are not receiving these e-mails, please log in to the eFile & Pay Main Menu and choose “Change a Profile” to add your e-mail address.

How do I update my e-mail address?

To update your contact or e-mail information, first go into eFile & Pay. On the Main Menu, choose “Change a Profile.”

I am signed up to receive the reminders, but I am not getting them. Why?

Confirm the e-mail address on file is current. On the Main Menu of eFile & Pay, choose “Change a Profile.” If the e-mail address is correct, the issue may be related to firewalls and security settings on your computer.

Business Taxes

What tax types are classified as business taxes?

Withholding, sales, retailer's use, consumer's use, LPG, and motor fuel.

Am I required to file business tax returns electronically?

Paper returns are not provided, so eFile & Pay is the best option for filing your withholding, sales, retailer's use, and consumer's use returns. Fuel tax returns are required by law to be filed electronically.

Do I need to register to use eFile& Pay to pay my business taxes?

No. Taxpayers do not need to register for eFile & Pay. A taxpayer who has an active business tax permit will receive a Business eFile Number (BEN) in the mail with information about the filing process on eFile & Pay. This applies to all business tax filers, including current EFT/semi-monthly filers.

How do I apply for a permit or license?

Withholding and Sales/Use Taxes

To apply or register for a withholding, sales, retailer's use, or consumer's use tax permit, use the Department's online application. Your online application will be processed in approximately three weeks.

If you plan to use an accountant or attorney in your business activities, please consider completing a Power of Attorney form at the time you apply for your tax permit(s), as some information is considered confidential.

Motor Fuel Tax

To apply for a fuel tax license, complete the Iowa Motor Fuel Tax License Application (pdf) and send it to the Department as instructed on the application form.

Do I need a different permit for each business location?

Withholding

No. You need only one withholding permit for multiple business locations as long as they are under the same Federal Employer Identification Number (FEIN).

Sales

Yes. Each Iowa business location must have its own sales tax permit. The option is available to file a consolidated return.

Use

No. Only one permit is required.

Motor Fuel

Only one license is required for Suppliers, Restrictive Suppliers, Importers, and Blenders. LPG Dealers/Users must obtain a separate license for each location, with the option to also apply for a consolidated license.

If I change the name of my business, do I need a new permit?

If the Internal Revenue Service allows you to keep the same Federal Employer Identification Number (FEIN) you had before the name change, you keep the same Iowa permit. However, you will need to notify us of the name change. Please change your business registration name information online with us.

If the IRS requires you to obtain a new FEIN, you will cancel the Iowa permit you currently have and apply for a new one.

What is the difference between a sales tax permit and a retailer's use tax permit?

Persons making taxable sales from an Iowa location must apply for a sales tax permit. Those making taxable sales into Iowa from an out-of-state location should obtain a retailer's use tax permit.

Do I need a consumer's use tax permit?

Persons regularly purchasing taxable goods or services for their own use in Iowa from an out-of-state source not collecting Iowa tax must register with the Department for a consumer's use tax permit.

I have a consumer's use tax permit and a sales tax permit. Do I need both?

Occasionally, a business will make a purchase for its own use and owe Iowa consumer's use tax. The business can report the purchase and pay the tax due on its quarterly sales tax return on line 2 "goods consumed" instead of separately registering for consumer's use tax. If your taxable purchases are rare, you may want to consider reporting them on the sales tax return in this way. If you choose this option, you may cancel your consumer's use tax permit online or complete a paper Request for Change, Correction or Cancellation of Tax Permit (pdf) form.

How do I cancel a permit?

To cancel a permit: Change / cancel / reinstate business tax registration

Your online cancellation will be processed in approximately four weeks.

What are the different filing frequencies?

Withholding

Semi-monthly: more than $10,000 tax/month
Monthly: more than $500 tax/month
Quarterly: less than $500 tax/month

Sales Tax

Semi-monthly: more than $5,000 tax/month
Monthly: more than $500 tax/month;
Quarterly: less than $500 tax/month
Annual: less than $120 tax/year

Retailer's Use Tax

Monthly: more than $1,500 tax/month
Quarterly: less than $1,500 tax/month
Annual: less than $120 tax/year

Consumer's Use Tax

Quarterly: more than $120 tax/year
Annual: less than $120 tax/year

Motor Fuel Tax

All filers except Importers are monthly filers. Importers file on a semi-monthly basis.

How do I register for unemployment tax?

Contact Unemployment Insurance Services Division of Iowa Workforce Development at 515-281-5339 or 1-800-972-2024.

How do I register for workers compensation?

Contact Division of Workers' Compensation of Iowa Workforce Development at 515-281-5387 or 1-800-562-4692 or by e-mail.

Individual Income Tax (IA1040 / IA1040ES) and
Corporation Income Tax (IA1120 / IA1120ES)

Do I need to register to use eFile & Pay for individual or corporation income taxes?

No. Simply click on the Not Enrolled link from the Welcome screen to make your payment without registering.

You have the option of registering (enrolling) at the bottom of the Taxpayer Information screen. If you place a check mark in that box, you will be mailed a Business eFile Number by the Department and your Taxpayer Information will be retained for future use.

Is there a charge for using eFile & Pay to make income tax payments?

No.

Do I have to pay electronically?

If you were required to pay electronically prior to eFile & Pay, you still are. We recommend electronic payments for all filers, but unless you were previously required to pay electronically, this is an option.

How far into the future can I set up a payment?

Individual Estimated Tax

Payments can be scheduled in advance within a calendar year.

Corporation Estimated Tax

Payments can be scheduled in advance within the current fiscal year.

Individual or Corporation Payment of Tax Due Shown on Return

Payments can be scheduled in advance to be made on or before the due date of the return.

06/11/10