Sales tax on labor in Iowa: taxed on repairs to things, not on new construction; building repairs and installation depend on the job

Repairing a thing in Iowa

Taxed. Iowa taxes a long list of repair services by name, including household appliance repair, machine repair of all kinds, motor repair and vehicle repair. Repairing a thing on that list is taxable labor.

• “Household appliance, television, and radio repair ... Machine repair of all kinds ... Motor repair” — Iowa Sales and Use Tax: Taxable Services, no date on the page

Repairing a home or building in Iowa

It depends. Usually taxable: most building trades are on Iowa's taxable list (carpentry, electrical, plumbing, roofing, painting, sheet metal and more), and repairs are not covered by the construction exemption. Examples the state gives: repairing broken water heaters, furnaces and central air. A few trades (brick laying, concrete, siding, flooring, tiling) are not taxable if itemized. What it turns on: whether the trade is one of Iowa's listed taxable services (most building trades are) and whether the job is a repair rather than new construction, reconstruction, alteration, expansion or remodeling.

• “Taxable labor involved in any job that does not qualify as new construction, reconstruction, alteration, expansion, or remodeling, such as repairs and installations, is subject to sales tax. ... Installing new light fixtures. Repairing broken water heaters, furnaces, or central air conditioning units. Replacing or repairing the original wiring in buildings.” — Iowa Contractors Guide (Iowa Department of Revenue), page date: 2025-08-27
• “Services not subject to sales tax, if separately itemized, include the following: Brick laying Concrete finishing Siding installation Laying vinyl, wood, and other flooring Carpet installation Tiling” — Iowa Contractors Guide (Iowa Department of Revenue), page date: 2025-08-27
• “When services are performed on or connected with new construction, reconstruction, alteration, expansion, or remodeling of a building or structure, they are exempt from sales and use tax. Repair services remain taxable.” — Iowa Sales and Use Tax: Taxable Services, no date on the page

Installation work in Iowa

It depends. Installation work that is not part of new construction or remodeling is taxable when the trade is a listed service (for example installing new light fixtures). Some installations (siding, flooring, carpet, tiling) are not taxed if itemized separately. Replacing a working furnace with a better one counts as remodeling (not taxed); replacing a broken one is a taxable repair. What it turns on: whether the trade is a listed taxable service, whether it is itemized, and whether the job counts as new construction/remodeling (exempt) or as a repair/installation (taxable)

• “Taxable labor involved in any job that does not qualify as new construction, reconstruction, alteration, expansion, or remodeling, such as repairs and installations, is subject to sales tax. ... Installing new light fixtures. Repairing broken water heaters, furnaces, or central air conditioning units. Replacing or repairing the original wiring in buildings.” — Iowa Contractors Guide (Iowa Department of Revenue), page date: 2025-08-27
• “Services not subject to sales tax, if separately itemized, include the following: Brick laying Concrete finishing Siding installation Laying vinyl, wood, and other flooring Carpet installation Tiling” — Iowa Contractors Guide (Iowa Department of Revenue), page date: 2025-08-27
• “if a building's existing furnace is not defective, but the owner of the building has a new, more energy efficient furnace installed, the service is reconstruction or remodeling. However, if the building's furnace is defective, the replacement of the furnace is a repair.” — Iowa Contractors Guide (Iowa Department of Revenue), page date: 2025-08-27

New construction in Iowa

Not taxed. Labor on new construction, reconstruction, alteration, expansion or remodeling of a building is not taxed. The contractor pays tax on materials when buying them and charges the customer no tax on labor or materials.

• “When a contractor performs new construction, reconstruction, alteration, expansion, or remodeling, the contractor must pay sales or use tax on the building materials and supplies at the time they are purchased and does not collect any tax from the customer. Also, the contractor does not charge sales tax on the sales price of the labor involved in completing the job.” — Iowa Contractors Guide (Iowa Department of Revenue), page date: 2025-08-27
• “When services are performed on or connected with new construction, reconstruction, alteration, expansion, or remodeling of a building or structure, they are exempt from sales and use tax. Repair services remain taxable.” — Iowa Sales and Use Tax: Taxable Services, no date on the page

Listing labor separately on the bill in Iowa

Changes the answer. If labor is itemized, it is taxed only when it is a taxable service; if the bill is not itemized, the whole bill is taxed.

• “If the labor charges are itemized, repair businesses must charge sales tax on the sales price of the labor charges only if a taxable service is involved in completing the particular project. If the invoice is not itemized, repair businesses must charge sales tax on the full amount of the non-itemized billing.” — Iowa Contractors Guide (Iowa Department of Revenue), page date: 2025-08-27

Materials on jobs in Iowa

Either: on new construction/remodeling the contractor is the consumer and pays tax on materials at purchase; on repairs and installations the contractor (repair business) buys for resale and charges the customer tax on materials.

• “When a contractor performs new construction, reconstruction, alteration, expansion, or remodeling, the contractor must pay sales or use tax on the building materials and supplies at the time they are purchased and does not collect any tax from the customer. Also, the contractor does not charge sales tax on the sales price of the labor involved in completing the job.” — Iowa Contractors Guide (Iowa Department of Revenue), page date: 2025-08-27
• “If the labor charges are itemized, repair businesses must charge sales tax on the sales price of the labor charges only if a taxable service is involved in completing the particular project. If the invoice is not itemized, repair businesses must charge sales tax on the full amount of the non-itemized billing.” — Iowa Contractors Guide (Iowa Department of Revenue), page date: 2025-08-27

Trade services Iowa taxes

The services Iowa's own pages name as taxed, each in the page's words:

• Landscaping and lawn care: “Landscaping, lawn care, and tree trimming and removal”
• “Janitorial and building maintenance or cleaning (non-residential only)”
• “Extermination services”
• Carpet cleaning: “Carpet, rug, and upholstery cleaning and repair”
• Plumbing: “Plumbing, including drain cleaning and unplugging toilets, sinks, and sewers”
• Electrical: “Electrical and electronic repair and installation”
• Carpentry: “Carpentry repair and installation”
• Roofing: “Roof, shingle, and glass repair”
• Painting: “Painting, papering, and interior decorating”
• Appliance repair: “Household appliance, television, and radio repair”
• Pool service: “Swimming pool cleaning and maintenance”
• Sheet metal: “Tin and sheet metal repair”

Where Iowa's list of services comes from

• “Household appliance, television, and radio repair ... Machine repair of all kinds ... Motor repair” — Iowa Sales and Use Tax: Taxable Services, no date on the page

What was not checked for Iowa

• Iowa's separate page on landscaping, lawn care, snow removal and tree services was not opened, so snow removal is not listed. The department's taxable services page points to Iowa Code 423.2(6) for the official list, which was not opened either.

Check with the Iowa Department of Revenue

Before you bill: check with the Iowa Department of Revenue. As of November 6, 2026.

This is a plain-words summary of each state's own revenue guidance as of November 6, 2026, not tax advice. Rules have exceptions, and cities and counties can add taxes of their own. Check with the state's tax department, linked on every state's page, before you bill.

Compare Iowa with every state's answer, or with its neighbours just below.

Next door to Iowa

• Illinois: home repair not taxed, installation depends
• Minnesota: home repair not taxed, installation depends
• Missouri: home repair not taxed, installation depends
• Nebraska: home repair not taxed, installation depends
• South Dakota: home repair taxed, installation depends
• Wisconsin: home repair depends, installation depends

Official sources for Iowa

• Iowa Contractors Guide (Iowa Department of Revenue) — 2025-08-27
• Iowa Sales and Use Tax: Taxable Services — no date shown

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