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Iowa — Cigarette Wholesaler And Tobacco Subjobber Bond

Iowa's combined wholesaler/subjobber caption does not automatically mean a $3,500 bond. The cigarette-wholesaler requirement is $2,500; the separate $1,000 tobacco-distributor requirement applies to a different role from a tobacco subjobber.

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Recorded state
Iowa
Bond type
Cigarette / Tobacco Tax Bond
Category
Business operations & taxes

What this bond does

Match the cigarette-wholesaler permit and tobacco-subjobber license to the business you actually conduct. Buying other tobacco products from a distributor for resale to nonconsumers is not the same statutory activity as importing or manufacturing them as a distributor.

Who needs it
Businesses wholesaling cigarettes and acting as tobacco subjobbers. A grocery chain merely moving stock between its own outlets is not performing a cigarette-wholesaler transaction under the current rule.
Who it protects
For the cigarette permit, section 453A.14 requires security in favor of Iowa for taxes, damages, fines, penalties and costs adjudged against the permit holder for violating the cigarette subchapter. A tobacco-distributor bond has a different compliance/tax-payment condition; do not assume the combined caption substitutes one for the other.

Your bond option

This is the option on record for this bond.

The bond amount describes the limit of the bond obligation, not the price. A listed amount does not establish what the requesting party requires. The premium is what you pay and must be confirmed for the actual option. An E&O limit, where listed, is separate errors and omissions insurance.

Details for the combined wholesaler/subjobber listing

Current rule 701—231.3 sets cigarette-wholesaler security at $2,500. The statute's general $500 floor is not that role's current required amount. Have Revenue identify the actual permit classes before choosing security.

Section 453A.42 defines a tobacco subjobber as someone other than a manufacturer or distributor who buys from a distributor and resells to persons other than ultimate consumers. Section 453A.44 requires subjobber licensing, but places the $1,000 surety requirement on tobacco distributors, not every subjobber.

The current tobacco rule permits one subjobber permit for the person's statewide activities. That is different from the distributor's location-based licensing. Keep the cigarette business locations and actual tobacco activity clear in the application rather than assuming all licenses use the same location rule.

If you also import tobacco products, manufacture them or otherwise perform the statutory distributor function, address that additional role with Revenue. Eligible cigarette/tobacco aggregation must cover both actual conditions and the required total; a combined catalog title alone does not establish an acceptable aggregate.

Cigarette applications and prescribed bonds are filed electronically. Cigarette permits and tobacco licenses have June 30 cycles, but use Revenue's accepted security period and execution directions. If Revenue demands new or additional cigarette security because the existing bond is inadequate, section 453A.14 allows ten days to supply it; that is not a voluntary cancellation notice.

Purchase Now opens Propeller's combined Iowa application in a new tab. Match the legal business, actual wholesaler/subjobber roles, Revenue's required sum and accepted instrument, then complete the state permit and filing steps. Provider payment does not issue either credential or authorize an unlicensed distributor activity.

Sources

Have these ready

  1. Legal business and Iowa cigarette-wholesaler/tobacco-subjobber account details.
  2. Actual resale, import, manufacturing and internal-transfer activities.
  3. Cigarette business locations and statewide subjobber activity.
  4. Revenue's required sum and any separately required distributor/aggregate condition.
  5. Accepted security period, electronic submission and execution instructions.

Questions about this bond

Does the combined name automatically require $3,500?

No. Current cigarette-wholesaler security is $2,500. The additional $1,000 tobacco-distributor bond is not a blanket subjobber requirement. Have Revenue match the amount to your actual roles.

Is a subjobber the same as a tobacco distributor?

The statute distinguishes them. A subjobber buys from a distributor and resells to nonconsumers; importing, manufacturing or other defined distributor activity can create different licensing and security duties.

Can one aggregate cover an additional tobacco-distributor role?

The rule permits eligible aggregation when the security can discharge either cigarette or tobacco liability and meets the required total. Ask Revenue to confirm the actual instrument and roles rather than relying on this listing's caption.

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