I've heard that some types of ACH transfers may be subject to tax by the state of Iowa while others are not taxed.

I am looking for a couple of good sources of information on this topic. If it is the case I'd like to find out what types of transfers are included and what types are excluded.

Many thanks.

riverbank, I searched the dept of revenue website and could find no reference to this. If you find there is a taxable situation, please let me know.

Service charges in Iowa are taxable; perhaps that's where it came from. Service charges to public bodies are not taxable, however.
Otie

Otis,

Thanks for the response. I am aware of the taxable service charge, and have wondered if that could be the source of confusion on this topic.

iafarmer,

Thanks for your thoughtful consideration on this issue. If I come upon any hard data to support the assertion regarding taxable transactions, I will certainly pass it along. In the meantime I will try to dispel fears.

If it actually is the case, it will certainly be unique based on what I understand across different states. Far be it from me to provide the states with additional ideas for capturing revenue! They seem quite adept as it is.

- Service charges subject to tax are those which relate to a depositor's checking account.
- ATM fees are subject to sales tax when the charge is to a customer of the financial institution that owns the ATM, and the charge is connected with the customer's checking account. However, these same fees are exempt from sales tax when they are charged by a financial institution to a non-customer or person who doesn't have a checking account with the ATM's financial institution.
- Service charges not related to a checking account could be exempt if it is performed in relation to another type of account.
There is also a listing of taxable charges and non-taxable charges. I can not link you to my source, but I hope this will get you started.

Money Market Savings with check writing privileges - sales tax on the service charge or not?

Received an answer from the IBA: Taxable for anyone who is curious!