Iowa Administrative Code › Agency 701 - Revenue Department › Title III - Sales, Use, and Excise Tax › Chapter 250 - Vehicles Subject to Registration › Rule 701-250.16 - Iowa Code Chapter 326 Vehicles

Current through Register Vol. 47, No. 3, July 24, 2024
(1)
				The period for substantiating mileage by the department is fiscal year July 1
				to June 30, with an exception if the initial registration period is a short
				year (less than 12 months). Mileage during that period will be totaled with the
				first full year for substantiation purposes.
(2) Whether a vehicle is registered prorate
				or has county plates does not determine eligibility for exemption.
(3) Records must be kept from the first four
				years of operation of the vehicle for at least ten years to prove the vehicle
				has consistently been eligible for the exemption. Summary records, such as the
				monthly or annual records required by the International Fuel Tax Agreement
				(IFTA), may be kept to prove the mileage requirement was met. Records are
				required for power units but not for trailers or semi-trailers.
(4) The exempt status of a trailer or
				semi-trailer is based upon to what it is attached. If attached to an exempt
				power unit, the trailer or semi-trailer is also exempt.
EXAMPLE A: XYZ Trucking purchased two semi-tractors two years
				  ago. An exemption was claimed because 25 percent of the mileage for each was
				  out-of-state mileage and they met the registered weight requirement. Two years
				  later, XYZ Trucking decided one of the semi-tractors will be used only in Iowa.
				  The registered weight did not change, but the 25 percent out-of-state mileage
				  requirement was not maintained for the first four years, so the exemption no
				  longer applies. XYZ Trucking's book value is $60,000, and the market value is
				  $75,000. The book value is less than the market value; the fee for new
				  registration is imposed on the $60,000 book value.
EXAMPLE B: Two years ago, XYZ Trucking purchased a power unit
				  and a semi-trailer. The power unit was used in excess of the 25 percent mileage
				  requirement and met the 13-ton weight requirement, so an exemption was claimed.
				  They were originally registered prorate. This year, XYZ Trucking decided to
				  register the power unit and semi-trailer with county plates instead of renewing
				  the prorate registration. Although the power unit and semi-trailer will be
				  county-plated, XYZ Trucking will still use the power unit 25 percent outside of
				  Iowa. The registered weight did not change. Since both the 25 percent mileage
				  factor and the 13-ton registered weight factor are met, the fee for new
				  registration is not due.
EXAMPLE C: Two years ago, XYZ Trucking purchased a power unit
				  and a semi-trailer. Both the power unit and semi-trailer were used in excess of
				  the 25 percent mileage requirement and met the 13-ton weight requirement, so an
				  exemption was claimed. The power unit and the semi-trailer were originally
				  registered prorate. This year, XYZ Trucking decided to register the
				  semi-trailer with county plates instead of renewing the prorate registration.
				  The power unit will still be used 25 percent outside of Iowa. The mileage of
				  the semi-trailer does not matter because there is no record-keeping requirement
				  for trailers or semi-trailers. The registered weight did not change. Since both
				  the 25 percent mileage factor and weight requirements continue to be met, the
				  fee for new registration is not due.
This rule is intended to implement Iowa Code section
				  321.105A
				  as amended by 2021 Iowa Acts, Senate File 366.