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B&O Taxes
Business & Occupation Tax
The City of Des Moines charges a Business and Occupation Tax for work conducted within the city limits during any tax year. Currently the city sends out quarterly B&O tax returns to business license holders earning $75,000 or more a year and an annual B&O tax return to all other active business license holders.

The city B&O tax ordinance was amended November 29, 2007, to include the requirement for allocation and apportionment of income effective January 1, 2008. The rules for allocation and apportionment of income are applied when activities take place in more than one jurisdiction and will vary depending on the classification of income reported:
  • Manufacturing: allocated to the location where the activity takes place
  • Retail Sales: the activity takes place where delivery to the buyer occurs
  • Wholesale Sales: the activity takes place where delivery to the buyer occurs
  • Royalties from the Granting of Intangible Rights: allocated to the commercial domicile of the taxpayer
  • Services and Other: apportioned to a city by multiplying service income by a payroll factor, plus the service-income factor, divided by two

The rates, established by Ordinance No. 1355, are as follows:
Gross Receipts
Tax
$50,000 or less per year
$0
Greater than $50,000 per year
0.002 times the net taxable revenue