Credit card processing and merchant services in Cedar Rapids, IA
Cedar Rapids voters extended the city's 1% street repair sales tax through June 30, 2034, so most taxable sales in the city carry 7%, counting Iowa's 6% state rate.
Cedar Rapids has voted on its 1% sales tax twice. In November 2013, city voters approved a 1% local option sales tax for street repairs, collected from July 1, 2014 through June 30, 2024. In November 2021 they extended it for ten more years, and the city's Paving for Progress page now gives June 30, 2034 as the end date. The money is set aside for repairing, building and rebuilding public streets.
At the register, that means 7% on most taxable sales: Iowa's 6% state rate plus the city's 1%. Set the full 7% before your first sale. A terminal left at 6% on $40,000 a month of taxable sales collects $400 a month too little, and the business may have to cover that gap itself.
The Census Bureau's July 1, 2025 estimate counts 137,935 people in Cedar Rapids and 232,028 in Linn County as a whole. If you add a location elsewhere in the county, look up that address's local option status before you copy your settings. The Iowa Department of Revenue says the extra 1% applies to most taxable sales because many cities and counties have adopted it. Many isn't all.
We found no Iowa surcharge statute, so the card networks set the limits: 3% or your cost on Visa, 4% or your cost on Mastercard, and no surcharge at all on debit or prepaid cards. The citations are on our Iowa page, and the notices you'd need are in our guide to surcharge signs.
Clearo works with Cedar Rapids businesses remotely, with POS terminals for the counter and interchange-plus pricing on every account. Before you add a fee, send us a recent statement for a free statement review. It shows what each card type is costing you now.
Rules that matter in Cedar Rapids
The 1% local option sales tax for streets
Cedar Rapids voters approved a 1% local option sales tax for street repairs in November 2013, to be collected from July 1, 2014 through June 30, 2024. In November 2021 they extended it for another ten years, from July 1, 2024 through June 30, 2034. The city reserves the revenue for the maintenance, repair, construction and reconstruction of public streets.
The Iowa Department of Revenue says the 1% local option tax applies to most sales subject to sales tax, so most taxable sales in the city carry 7% with the state's 6%.
Sources: City of Cedar Rapids, City financial information on Paving for Progress; City of Cedar Rapids, Paving for Progress; Iowa Department of Revenue, Local option sales tax (LOST)
Payment services we provide
Guides worth reading next
All guidesFees and pricing
Debit card processing fees: the cap, the rates, the math
Debit card processing fees explained: the Regulation II cap, exempt debit rates, PIN vs signature debit, worked examples, and why flat rates overcharge debit.
Fees and pricing
What are interchange fees, and who gets the money?
What are interchange fees? The cut of each card sale paid to the card-issuing bank. Who sets them, what moves the rate, and how they show on your statement.
Hardware and POS
Mobile credit card reader: how to choose the right one
Choosing a mobile credit card reader: phone-paired readers, portable terminals, and tap to pay compared on connection, offline risk, costs, and features.
Common questions
When does the Cedar Rapids 1% sales tax end?
The City of Cedar Rapids lists June 30, 2034. Voters first approved the 1% local option sales tax in November 2013 for July 2014 through June 2024, then voted in November 2021 to extend it for another ten years. Until that date, keep 7% in your tax settings for most taxable sales.
What rate should a Cedar Rapids POS charge on taxable sales?
Usually 7%: Iowa's 6% state rate plus the city's 1% local option tax. Set tax by product category instead of one rate for the whole basket, because items Iowa doesn't tax shouldn't pick up either rate. If you open a second location in another city or county, check its local option status before you copy these settings to its POS terminals.
Is a card surcharge allowed at a Cedar Rapids store?
Yes, within the card networks' rules, because we found no Iowa statute on surcharges. Visa caps a credit card surcharge at 3% and Mastercard at 4%, neither can exceed your actual cost, and debit and prepaid cards can't be surcharged. Visa also wants 30 days' written notice to your acquirer and the fee posted at the entrance, at checkout and on the receipt. Our surcharging program handles the setup.
What should a Cedar Rapids business check on its processing statement?
Start with your effective rate: last month's total fees divided by total card sales. Then split the fees into two groups: interchange and card network fees, which go to the card-issuing banks and the networks, and everything else, which is your processor's markup. The markup is the number worth comparing. Our guide to reading a merchant statement shows where each fee appears, or send it to us for a free statement review.
Disclaimer: general information, not professional advice
This page is general educational information, not legal, tax, accounting or financial advice. Rules and rates vary by place and change, so confirm them with the official source and a qualified professional before you act. Full terms are in our Terms of Service.
Let's talk about your payments
Tell us about your business and how you take payments now, and a Clearo rep will reach out within one business day.