Iowa State University of Science and Technology, as an agency of the State of Iowa, is a federally tax-exempt organization under Internal Revenue Code Section 115, which exempts income derived from the exercise of any essential governmental functions. The IRS has recognized that education is an essential governmental function. (Rev. Ruling 75-436).

Use of the University’s tax identification number and/or the use of the name “Iowa State University” is expressly limited. Legal rights to the use of the name have been granted by the Board of Regents, but have been limited to certain affiliated organizations including Iowa State University Foundation, Iowa State University Alumni Association, and Iowa State University Research Park.

The Tax Office cannot give advice regarding individual income tax situations for students or University faculty or staff.

Useful Documents

Sales and Local Option Taxes: Iowa State University (ISU) is exempt from sales taxes and local option taxes on purchases of goods or services within the State of Iowa. However, there are several states in which ISU is not exempt from sales taxes. Please see Procurement Services' Sales Tax Information site for more information. The exemption only applies if ISU pays the invoice directly. Employees making purchases to be reimbursed later do not qualify for exemption from sales or local option taxes.

Excise Taxes: ISU is exempt from most federal excise taxes. Excise taxes for fuels and telecommunications must be paid, but ISU can apply for a refund later. Some manufacturer's taxes, such as for coal or vaccines, do not qualify for an exemption. IRS Publication 510 provides information on exemptions from excise taxes.

Hotel/Motel Taxes: As of July 1, 2009 ISU usually is not exempt from paying hotel taxes within the state of Iowa. A possible exception is guest room contracts for periods of more than 31 consecutive days when ISU makes the payment directly. ISU travelers are never exempt from taxes when paying the charge themselves and subsequently requesting reimbursement. Please contact Procurement Services for additional information.

Disclaimer: The information on this page is not intended as legal advice.