Iowa Code 423.52 – Relief from liability for sellers and certified service providers
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1. Sellers and certified service providers using databases derived from zip codes or state or vendor provided address-based databases are relieved from liability to this state or its local taxing jurisdictions for having charged and collected the incorrect amount of sales or use tax resulting from the seller or certified service provider relying on erroneous data provided by this state on tax rates, boundaries, or taxing jurisdiction assignments. If this state provides an address-based system for assigning taxing jurisdictions, the director is not required to provide liability relief for errors resulting from reliance on a database derived from zip codes and provided by this state if the director has given adequate notice, as determined by the governing board, to affected parties of the decision to end this relief.
Terms Used In Iowa Code 423.52
- Certified automated system: means software certified under the agreement to calculate the tax imposed by each jurisdiction on a transaction, determine the amount of tax to remit to the appropriate state, and maintain a record of the transaction. See Iowa Code 423.1
- Certified service provider: means an agent certified under the agreement to perform all of a seller's sales or use tax functions, other than the seller's obligation to remit tax on its own purchases. See Iowa Code 423.1
- Department: means the department of revenue. See Iowa Code 423.1
- Director: means the director of the department of revenue. See Iowa Code 453A.42
- Director: means the director of revenue. See Iowa Code 423.1
- Governing board: means the group comprised of representatives of the member states of the agreement which is created by the agreement to be responsible for the agreement's administration and operation. See Iowa Code 423.1
- Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
- Member state: is a ny state which has signed the agreement. See Iowa Code 423.1
- month: means a calendar month, and the word "year" and the abbreviation "A. See Iowa Code 4.1
- seller: includes an affiliated group of sellers using the same proprietary system. See Iowa Code 423.1
- State: means any state of the United States, the District of Columbia, and Puerto Rico. See Iowa Code 423.1
- System: means the central electronic registration system maintained by Iowa and other states which are signatories to the agreement. See Iowa Code 423.1
- Use: means the exercise of any right or power incidental to the ownership of tobacco products. See Iowa Code 453A.42
- Use: means and includes the exercise by any person of any right or power over or access to tangible personal property or a specified digital product incident to the ownership of that property, or any right or power over or access to the product or result of a service. See Iowa Code 423.1
- Use tax: means the tax levied under subchapter III of this chapter. See Iowa Code 423.1
2. a. Model 2 sellers and certified service providers are relieved of liability to Iowa for any failure to charge and collect the correct amount of sales or use tax if this failure results from the model 2 seller’s or the certified service provider’s reliance upon this state’s certification to the governing board that Iowa has accepted the governing board’s certification of a piece of software as a certified automated system. The relief provided by this paragraph to a model 2 seller or certified service provider does not extend to a seller or provider who has incorrectly classified an item or transaction into the product-based exemptions portion of a certified automated system. However, any model 2 seller or certified service provider who has relied upon an individual listing of items or transactions within a product definition approved by the governing board or Iowa may claim the relief allowed by this paragraph.
b. If the department determines that an item or transaction is incorrectly classified as to its taxability, the department shall notify the model 2 seller or certified service provider of the incorrect classification. The model 2 seller or certified service provider shall have ten days to revise the classification after receipt of notice of the determination. Upon expiration of the ten days, the model 2 seller or certified service provider shall be liable for the failure to collect the correct amount of sales or use taxes due and owing to the member state.
3. a. Sellers and certified service providers are relieved from liability to this state or its local taxing jurisdictions for having charged and collected the incorrect amount of sales or use tax resulting from the seller or certified service provider relying on erroneous data provided in the state’s taxability matrix.
b. Sellers and certified service providers that rely upon a prior version of the state’s taxability matrix shall be relieved of liability to the state and its local taxing jurisdictions until the first day of the calendar month that is at least thirty days after notice of a change to the taxability matrix is submitted by the state to the governing board.