Iowa car sales tax: 5% and what it applies to

• Iowa charges 5%, and that rate is the same everywhere in the state — no county or city adds to it on a vehicle purchase.

• Taxed on top of the vehicle price: dealer-installed accessories.
• Not part of the taxable amount: the dealer doc fee and extended warranties and service contracts.
• Your trade-in comes off before tax is calculated.

• Iowa does not charge sales tax on a car. It charges a one-time fee for new registration instead: $10 plus 5% of the purchase price, the same in every county. It is paid with the title application, and the dealer can collect it at the sale and pass it to the county treasurer.
• The 5% is figured on the price of the car, freight and dealer-installed accessories included. The doc fee is not part of it. An optional service contract or vehicle protection package is left out if it is listed separately on the contract.
• Optional service contracts that cover repairs carry Iowa sales tax (6% plus the 1% local option tax in most places) even though the car does not. The calculator adds an estimate of 7% on the finance-office box.
• Registering the car: the dealer can take your title and registration application and the government fees at the sale and send them to the county treasurer within 30 days, and it gives you a 45-day "registration applied for" card. If you do not use the dealer, you have 30 days to apply at any county treasurer's office. The fees are in the calculator's total because you pay them either way.

Source: Iowa Department of Revenue - Iowa Tax/Fee Descriptions and Rates · rules last verified Oct 11, 2026. Methodology.