Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 33 - Receipts Subject to Use Tax Depending on Method of Transaction › Rule 701-33.9 - Sales of Mobile Homes, Manufactured Housing, and Related Property and Services

Current through Register Vol. 47, No. 3, July 24, 2024
(1)
Sales
				of mobile homes, manufactured housing, and related property and services for
				one package price.
This rule is applicable only to mobile homes and
				manufactured housing sold as tangible personal property rather than in the form
				of real property. If, at the time of the sale, a mobile home or manufactured
				housing is real property, this rule is not applicable to it. If a mobile home
				dealer buys a mobile home, incorporates that mobile home into real estate in
				the manner required by and described in Iowa Code section
				43526.,
				and then sells the mobile home to a consumer, the sale of that mobile home, the
				sale of any services used to transform the mobile home from tangible personal
				property to real property, and the sale of any tangible personal property with
				the mobile home (such as furniture) are governed by 701-Chapter 19 which deals
				with building contracts and building contractors. Sales of manufactured housing
				in the form of real estate are governed by rule
				701-3310.
				(423).
When a customer purchases a mobile home or manufactured
				  housing from a dealer, it is usually the customer's wish that the dealer
				  prepare the mobile home or manufactured housing so that it is ready for the
				  customer to move into it. To render a mobile home or manufactured housing
				  "ready to move into" a dealer will sell, with the home or housing, certain
				  tangible personal property and will also perform or arrange for other parties
				  to perform various services.
With respect to any one particular mobile home or
				  manufactured house which a dealer may sell, a dealer may provide any
				  combination of the following services or provide the following services and
				  sell the below-listed property to any person purchasing the home or
				  house:
1. Connect the
				electricity.
2. Connect the
				water
3. Connect sewer system
				lines.
4. Sell and install
				skirting. Skirting is used to fill the space between the bottom of the mobile
				home or manufactured house and the ground. It gives the home or house an
				appearance more like a conventional home because it covers up this
				space.
5. Build and install steps
				for a door
6. Build a
				deck.
7. Do minor repair
8. Install and sell a foundation upon which
				to place the mobile home or manufactured housing.
9. Sell furniture or appliances (e.g., air
				conditioners, refrigerators, and stoves) for use in the mobile home or
				manufactured housing. Install the appliance (e.g., an air conditioner) if
				necessary.
A dealer selling a mobile home or manufactured housing on a
				  "ready-to-move-into" basis usually sells that home or housing and the services
				  and additional property necessary to render them livable for one "package
				  price." The dealer and customer do not bargain separately for the sale of the
				  various articles of tangible personal property (e.g., the mobile home or
				  manufactured house and appliances) or the services (e.g., electrical
				  installation) which are part of this package price; nor is the dealer's package
				  price broken down to indicate any of the expenses which are components of the
				  package price either in the dealer's sales contract or on any sales
				  invoice.
The package price of any one particular mobile home or
				  manufactured house will vary depending upon how many services the dealer will
				  provide, or how much tangible personal property the dealer will sell in
				  addition to the home or house. In many cases, a dealer will contract with a
				  third party to perform the services promised in the dealer's contract to a
				  customer For example, the dealer will contract with a third party to hook up
				  the home or house purchaser's electricity, install window air conditioning or
				  will contract with a third party to build a deck or perform minor repairs on
				  the mobile home or manufactured house.
In the situation described above, the "purchase price" of a
				  mobile home or manufactured house is the entire package price charged for the
				  home or house, additional personal property for use in and around the home or
				  house, and services performed to render the home or house livable. The entire
				  amount of the package price, reduced by 40 percent prior to July I, 2008, or by
				  80 percent on or after July I, 2008, as explained in rule
				  701-323.
				  (423), is used to calculate the amount of use tax due resulting from the sale
				  of the mobile home or manufactured house. No part of the package price is
				  subject to Iowa sales tax; rather it is subject to Iowa use tax.