Iowa Short-Term Rental Laws & Hotel Tax (2026)

State license required

No

Latest rule change

Jul 1, 2026

The laws in brief

Issued by

Iowa Department of Revenue (sales tax permit); cities and counties may not charge a short-term rental license or permit fee

Valid for

There is no state or city short-term rental license to renew; Decorah's rental permit, which covers short-term rentals, renews each year.

On listings

No number needed on listings

Platform checks

Iowa has no statewide permit number for Airbnb to verify; Airbnb collects and remits the state and local lodging tax at booking.

Fees

Who qualifies

• Any single-family house or dwelling unit, condominium, cooperative or timeshare unit, or owner-occupied home offered for 30 days or less counts as a short-term rental property.
• Cities and counties may not require a license or permit fee for a short-term rental property.
• Iowa City and Decorah issue a rental permit that covers short-term rentals and charge no fee for it.

How to apply

1. 1 Check whether the city or county runs a rental permit that covers short stays; Iowa City and Decorah do, at no fee.
2. 2 For bookings made outside Airbnb, register for an Iowa sales tax permit with the Department of Revenue through GovConnectIowa, then file hotel and motel tax returns.
3. 3 Check the lease, condominium declaration or HOA rules for any ban on short-term hosting.

Permit rules

No city or county license or permit fee

A city or county may not require a license or permit fee for a short-term rental property.^1,2

Airbnb collects and remits the tax

A marketplace such as Airbnb or Vrbo is responsible for collecting and remitting all applicable state and local hotel and motel taxes on its bookings.^12,28

Direct bookings need a sales tax permit

A property owner who takes rentals directly, outside a marketplace, must hold an Iowa sales tax permit and remit the state and local hotel and motel tax to the Department of Revenue each quarter.^12,13

Advertised price must be the total price

Since May 12, 2025 a federal rule requires any advertised price for a short-term rental to show the total price, including mandatory fees; taxes and other government charges may be shown separately.^7,20 In force since May 12, 2025

Iowa City: rental permit covers short-term rentals

Iowa City requires a rental permit for any short-term rental property, and no application or inspection fee may be charged.⁹ Applies to: Iowa City

Decorah: rental permit with no fee for short-term rentals

Decorah issues a rental permit for long-term and short-term rentals; its permit form lists no fee for short-term rentals and requires annual renewal.²⁶ Applies to: Decorah

Cities cannot regulate short-term rentals as such

An Iowa city may not adopt or enforce any regulation, restriction or other ordinance, including a conditional use permit requirement, relating to short-term rental properties, apart from the safety, noise, nuisance, illegal-use and emergency-contact purposes the statute lists.¹ Applies to: Cities

Counties are bound by the same limit

A county may not adopt or enforce any regulation, restriction or other ordinance, including a conditional use permit requirement, relating to short-term rental properties in the county, with the same exceptions as cities.² Applies to: Unincorporated areas

A short-term rental is a residential land use

State law classifies a short-term rental property as a residential land use for zoning purposes in both cities and counties.^1,2

What counts as a short-term rental

A short-term rental property is a single-family house or dwelling unit, a condominium, cooperative or timeshare unit, or an owner-occupied home offered for a fee for 30 days or less; the statute sets no owner-occupancy condition.^1,2

Des Moines: short-term rental is an accessory use

Des Moines's zoning code allows a short-term rental as an accessory use to a household living use.⁸ Applies to: Des Moines

Leases, condominium and HOA rules still apply

Airbnb advises hosts to check HOA or co-op board rules and their lease for any prohibition on subletting or hosting.²⁹

1. 1. Des Moines

   Polk County

   Des Moines's zoning code allows a short-term rental as an accessory use to a household living use, with no short-term rental permit or conditional use approval in the current code. A house the owner does not occupy needs a city rental certificate, a general rental-housing requirement whose page does not mention short stays. Lodging tax is 12% (5% state plus 7% local).^1,8,15,21

   • Zoning: short-term rental is an accessory use to a household living use (Chapter 134)
   • Rental certificate required for a house the owner does not occupy; the page does not mention stays under 30 days
   • Lodging tax 12%: 5% state plus 7% local
   • State law bars a short-term rental license or permit fee

2. 2. Cedar Rapids

   Linn County

   Cedar Rapids requires a Landlord Business Permit and annual rental registration for anyone who rents out a dwelling unit under Chapter 29 of its housing code, and its inspection pages do not address stays under 30 days. State law bars a license or permit fee specific to short-term rentals. Lodging tax is 12% (5% state plus 7% local).^1,15,22

   • Landlord Business Permit and annual rental registration for rented dwelling units (Chapter 29)
   • Rental business training required for the owner or manager
   • No short-term rental license or fee under state law
   • Lodging tax 12%: 5% state plus 7% local

3. 3. Arnolds Park

   Dickinson County

   Arnolds Park, on the Iowa Great Lakes, charges 12% lodging tax (5% state plus 7% local), while unincorporated Dickinson County, Okoboji and Spirit Lake charge 10%. A 2018 city notice limited nightly rentals to a few zoning districts; the 2020 state law since requires short-term rentals to be treated as a residential land use.^1,15,23

   • Lodging tax 12% in Arnolds Park; 10% in unincorporated Dickinson County, Okoboji and Spirit Lake
   • City notice of 2018: nightly rentals only in the R-3 and commercial districts, predating the 2020 state law
   • State law classifies a short-term rental as a residential land use
   • State law bars a short-term rental license or permit fee

4. 4. Dubuque

   Dubuque County

   Dubuque licenses rental housing through its Housing and Community Development department, with a $45 dwelling unit licensing fee, and its rental licensing pages do not address stays under 30 days. State law bars a license or permit fee specific to short-term rentals. Lodging tax is 12% (5% state plus 7% local).^1,15,24,25

   • Rental license for rental housing; licensing fee $45 per dwelling unit
   • Online portal for rental license applications and renewals
   • No short-term rental license or fee under state law
   • Lodging tax 12%: 5% state plus 7% local

5. 5. Iowa City

   Johnson County

   Iowa City's code requires a rental permit for any short-term rental property, and no application or inspection fee may be charged. The owner or operator must also name a designated agent, and the permit follows the city's rental permit provisions on structure compliance. Lodging tax is 12% (5% state plus 7% local).^9,15

   • Rental permit required to let a short-term rental property (Code 17-5-16)
   • No application or inspection fee for short-term rental permits
   • Owner or operator must name a designated agent (Code 17-5-15)
   • Lodging tax 12%: 5% state plus 7% local

6. 6. Decorah

   Winneshiek County

   Decorah issues a rental permit for long-term and short-term rentals, renewed each year, and its permit form lists no fee for short-term rentals. Chapter 5.28 of the city code asks the owner to name a responsible agent who can respond within 24 hours. Lodging tax is 12% (5% state plus 7% local).^10,15,26

   • Rental permit covers long-term and short-term rentals; renewed every year
   • No fee for short-term rentals on the city's permit form
   • Responsible agent reachable within 24 hours (Chapter 5.28)
   • Lodging tax 12%: 5% state plus 7% local

7. 7. Davenport

   Scott County

   Davenport licenses all rental property at $30 to $60 a year, and the license page does not address stays under 30 days. State law bars a license or permit fee specific to short-term rentals. Lodging tax is 12% (5% state plus 7% local).^1,15,27

   • General rental property license, $30 to $60 a year by inspection cycle
   • Failing to register a rental property is a $500 fine
   • No short-term rental license or fee under state law
   • Lodging tax 12%: 5% state plus 7% local

8. 8. Clear Lake

   Cerro Gordo County

   Clear Lake's online code, last supplemented in May 2017, still sets a vacation rental permit at a $150 application fee, expiring each September 30, and fines up to $1,000. The chapter predates Iowa's 2020 ban on city short-term rental permit fees, so a host should confirm with the city's Planning and Zoning office before paying. Lodging tax is 12% (5% state plus 7% local).^1,11,15

   • Code Chapter 153: vacation rental permit per unit, $150 application fee, expires each September 30
   • Maximum occupancy 2 to 12 guests by bedroom count
   • Fines up to $250, $500 or $1,000 by offense
   • State law since 2020 bars a city short-term rental permit fee

What the host still handles

• An Iowa sales tax permit through GovConnectIowa, to remit hotel and motel tax on bookings made outside Airbnb (reported quarterly)
• A city rental permit where the city requires one for short stays (Iowa City and Decorah, at no fee)^{3,12,13,15,28}

Retail, restaurant and event uses are excluded

The definition does not cover a unit used for retail, a restaurant, banquet space, an event center or a similar use.¹

No night cap

Iowa Code sets no annual night cap, and a city or county may not add one, because it may not adopt or enforce a regulation relating to short-term rental properties.^1,2

Cities can enforce fire and building safety rules

A city or county may enforce fire and building safety, sanitation and traffic-control rules against short-term rentals, if it enforces them the same way as for similar homes that are not short-term rentals.^1,2

Noise, property maintenance and nuisance rules apply

Cities and counties may enforce residential-use rules on noise, property maintenance and nuisance against short-term rentals, on the same terms as other homes.^1,2

A local emergency contact may be required

A city or county may require a short-term rental host to give the local government an emergency contact.^1,2

Local rules must match those for other homes

The safety, noise and nuisance exceptions apply only if enforcement is carried out the same way as for similar properties that are not short-term rentals.^1,2

5% state hotel and motel tax

Iowa charges a 5% hotel and motel tax on the sales price of lodging located in the state; the state rate for lodging stays at 5%, not the 6% sales tax rate.^3,13

Cleaning and other fees are taxed

The taxable sales price includes cleaning fees, linen and towel fees, nonrefundable deposits and facilitation fees, not only the nightly rate.^3,12

Local hotel and motel tax up to 7%

A city, or a county outside city limits, may impose a local hotel and motel tax of up to 7% in whole percentage points, after a local vote.^3,14

Tax stops after 90 consecutive days

When the same guest rents for more than 90 consecutive days, the rental is exempt from hotel and motel tax after the 90th day.¹²

• Iowa Department of Revenue: a $1,000 penalty for each tax return still unfiled 90 days after a demand letter; late filing or late payment adds 5% of the unpaid tax and willful failure to file adds 75%.¹⁶
• Late payment of lodging tax: 5% of the unpaid tax when less than 90% of the correct tax is paid by the due date, and a further 5% for late filing.¹⁶
• Willful failure to file a return: a 75% penalty on the unpaid tax that cannot be waived.¹⁶

1. July 1, 2026
   Hiawatha begins a 7% local hotel and motel tax

   The Department of Revenue rate list effective July 1, 2026 shows a new 7% local hotel and motel tax in Hiawatha (Linn County), bringing the combined rate there to 12%.¹⁵

2. February 6, 2026 Lapsed
   House File 2320 would have let cities require registration

   House File 2320 would have let a city require registration of short-term rental properties, apply penalties for failure to register and treat them as lodging for hotel and motel tax. It was referred to the Local Government committee on February 6, 2026, and the bill history shows no later action.^6,19

3. February 9, 2024 Lapsed
   Senate File 2123 would have limited the bar to larger cities and counties

   Senate File 2123 would have applied the bar on local rules and permit fees only to cities and counties with more than 75,000 residents. A subcommittee recommended passage on February 9, 2024 and the bill moved no further; the 2026 Code has no population threshold.^1,5,18

4. June 29, 2020
   Iowa limits local short-term rental rules and permit fees

   Governor Reynolds signed House File 2641, which added the short-term rental limits now in Iowa Code sections 414.1 and 331.301 for cities and counties.^4,17

Estimate what a home could earn

1. 1. Iowa Code 414.1 Building restrictions, powers granted, rental properties, consumer fireworks · Iowa Legislature
2. 2. Iowa Code 331.301 County home rule implementation · Iowa Legislature
3. 3. Iowa Code chapter 423A Hotel and Motel Tax · Iowa Legislature
4. 4. House File 2641 (2020), enrolled act, Division XXV Short-Term Rental Properties · Iowa Legislature
5. 5. Senate File 2123 (2024), as introduced · Iowa Legislature
6. 6. House File 2320 (2026), as introduced · Iowa Legislature
7. 7. 16 CFR Part 464 - Rule on Unfair or Deceptive Fees · Electronic Code of Federal Regulations
8. 8. Chapter 134 Zoning Ordinance, Des Moines Municipal Code · City of Des Moines
9. 9. Iowa City Code 17-5-16 Certificate of Structure Compliance and Rental Permit · City of Iowa City
10. 10. Chapter 5.28 Rental Housing Permits, Decorah Municipal Code · City of Decorah
11. 11. Chapter 153 Vacation Rentals/Short-Term Rentals, Clear Lake Code of Ordinances · City of Clear Lake
12. 12. Iowa Hotel and Motel Tax · Iowa Department of Revenue
13. 13. Lodging frequently asked questions · Iowa Department of Revenue
14. 14. Iowa Tax/Fee Descriptions and Rates · Iowa Department of Revenue
15. 15. Local hotel and motel tax jurisdictions and rates, effective July 1, 2026 (spreadsheet) · Iowa Department of Revenue
16. 16. Penalties and Interest Rates · Iowa Department of Revenue
17. 17. Gov. Reynolds signs legislation into law, including key legislative priorities (June 29, 2020) · Office of the Governor of Iowa
18. 18. Senate File 2123 (2024), bill history · Iowa Legislature
19. 19. House File 2320 (2026), bill history · Iowa Legislature
20. 20. The Rule on Unfair or Deceptive Fees: Frequently Asked Questions · Federal Trade Commission
21. 21. Rental Inspections · City of Des Moines Neighborhood Inspections Division
22. 22. Rental Housing Inspections · City of Cedar Rapids Building Services
23. 23. City of Arnolds Park Fall Newsletter 2018 · City of Arnolds Park
24. 24. Rental Licensing & Inspection Fees · City of Dubuque
25. 25. Rental Licensing & Inspections · City of Dubuque
26. 26. Residential Rental Property Permit & Inspection form (March 2024) · City of Decorah
27. 27. Rental Property License · City of Davenport
28. 28. Occupancy tax collection and remittance by Airbnb in Iowa · Airbnb Help Center
29. 29. Responsible hosting in the United States · Airbnb Help Center