Iowa Revises Regulation on Sales of Candy

Monday, October 20th, 2014

Closeup of chocolates.

The Iowa Department of Revenue has revised its regulation on sales of candy, effective November 19, 2014.

Iowa exempts sales of food, but that exemption does not apply to sales of candy. The new rule has a revised subsection on what kinds of food are taxable candy and what kind of food are nontaxable.

Taxable candy includes preparations of fruits, nuts, or other ingredients in combination with sugar, honey, or other sweeteners in the form of bars, drops, or pieces. Other taxable candies include caramel apples, candy-coated popcorn, jellybeans, marshmallows, and mixes of candy pieces. Items that are normally sold as ingredients for use in recipes but which can be eaten as candy are taxable as candy. Such items include toffee bits, M&Ms, candy decorations for baked goods, and chocolate chips.

Nontaxable items include frostings, dried fruits without added sweetener, prepared fruit in sugar or similar base, syrups, cotton candy, and breakfast cereals.

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TTR has a website that companies subscribe to and use daily. This website provides a list of everything that can be bought or sold in the U.S. It provides simple answers to whether buying or selling these items is taxable (subject to a sales tax or other tax), and it provides all the legal authority to support these tax answers.

TTR likes to keep things simple and fun, which is why it has great people who provide help to clients on any support questions they have about transaction tax issues.

Please visit TTR on the web at or call 866.578.8193.

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