Did Curative's temporary medical staffing arrangement create a taxable Iowa private-employment-agency service?

Plain-English summary

Curative generally operated as a private employment agency, but this particular arrangement was not a taxable placement service because Curative—not the Iowa medical facility—employed the temporary worker.

Curative was an out-of-state talent agency that posted jobs and helped medical facilities find workers. In the transaction presented, Curative employed and paid a temporary certified registered nurse anesthesiologist, the Iowa facility supervised the worker, and the facility paid Curative weekly.

Iowa taxes private-employment-agency services when an agency aids someone in procuring employment, subject to the out-of-state-placement exclusion. The Department found that Curative generally fit the agency definition. But here Curative had not helped the worker obtain employment with the facility: the worker remained Curative's employee. Curative therefore had not performed the taxable service described in Iowa Code § 423.2(6)(aq).

The Department did not decide whether the CRNA's anesthesia and patient-monitoring services were taxable. Doing so would have determined the rights or responsibilities of the worker, who was not a party to the petition.

What this means for you

Staffing agencies

The employment relationship matters. An agency that places a person into employment with a client is different from an agency that remains the worker's employer under the disclosed arrangement.

Medical facilities

The order says no tax was due to Curative for the service it performed on these facts. It does not decide every charge involving temporary medical labor.

Tax professionals

Confirm who employs and pays the worker, who merely supervises day-to-day work, and whether the requested ruling would determine a nonparty's tax responsibility.

Common questions

Q: Was Curative a private employment agency?
A: Generally, yes. Its job listings and recruiting activities fit the rule's definition.

Q: Why was this arrangement not taxable as a placement service?
A: Curative itself employed the temporary worker, so it did not aid the worker in procuring employment with the facility.

Q: Did the Department rule that CRNA services are exempt?
A: No. It refused to decide the worker's service taxability because the worker was not a party.

Q: Did the medical facility owe sales tax to Curative?
A: The order's conclusion says no tax was due to Curative for the service described.

Citations and references

• Iowa Code § 423.2(5) — tax on enumerated services
• Iowa Code § 423.1(54) — services definition
• Iowa Code § 423.2(6)(aq) — private employment agencies
• Iowa Administrative Code rule 701—211.13 — private employment agencies and out-of-state placements
• Iowa Administrative Code rule 701—4.7(10)(a)(9) — refusal when a ruling would determine nonparties' rights or duties

Source

• Landing page: https://revenue.iowa.gov/resources/law-policy-information/administrative-orders
• Archive document link: https://revenue.iowa.gov/media/4291/download?inline
• Original PDF: https://documents.iowa.gov/home/PreviewDocument/10351995

Original ruling text

Reference No.: 25300010

CURATIVE TALENT LLC (DO) 2025

BEFORE THE IOWA DEPARTMENT OF REVENUE
HOOVER STATE OFFICE BUILDING
DES MOINES, IOWA
IN THE MATTER OF
CURATIVE TALENT LLC
500 3RD ST
SAN FRANCISCO CA 94107-6803

DECLARATORY ORDER
DOCKET NO. 913661

SALES/USE/EXCISE
Pursuant to a Petition for Declaratory Order (“Petition”) filed with the Iowa Department of
Revenue (“Department”) by Curative Talent LLC (hereinafter “Petitioner”) on April 29, 2025, and
in accordance with Iowa Code section 17A.9 (2025) and Iowa Administrative Code rule
701—4.7(17A,99G,123,421,17A), “Declaratory order—in general,” the Director issues the
following order.
I.

FACTS
The findings of fact are based on the Petition submitted to the Department, additional

information requested from the Petitioner, and publicly available information on Petitioner’s
website.1 Petitioner is an out-of-state talent agency that provides staffing services to medical
facilities. Petitioner’s website has job boards where job seekers can search for jobs by state.2
Job seekers can choose whether they are looking for a full-time position, part-time position, or
for a locum tenens arrangement where they temporarily fill in for a medical worker while they
are unavailable. Petitioner also works with medical facilities by searching directly for qualified
job seekers to fill empty positions.3 Petitioner has no offices in Iowa, but does place temporary
workers in Iowa. Resp. to Req. for Additional Info. (July 16, 2025).

When considering a petition for declaratory order, “[t]he department may solicit additional information
from the petitioner… [or] from any other person on the questions raised.” Iowa Admin. Code r.
701—4.7(7).
2
Curative Recruiting by Doximity, https://curativetalent.com/ (last visited Aug. 6, 2025).
3
For Facilities, https://curativetalent.com/ (last visited Aug. 6, 2025).
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In the present situation, Petitioner has employed a temporary medical worker and has
placed them at a medical facility in Iowa. The temporary medical worker is a Certified
Registered Nurse Anesthesiologist (CRNA) carrying out medical services such as administering
anesthesia and monitoring patients for in and outpatient procedures. Pet. at 1, No. 913661 (April
29, 2025). The temporary medical worker is employed and paid weekly by the Petitioner, and
works under the supervision of the medical facility. Resp. to Req. for Additional Info. (July 16,
2025). The medical facility pays the Petitioner weekly. Id. The Petitioner charges the medical
facility for services provided and includes sales tax. Id. The Petitioner states the medical facility
is currently withholding sales tax because it doesn’t believe that it owes sales tax under Iowa
law. Id.
II.

QUESTIONS PRESENTED
The Petition presents the following issues:

1. Does the Petitioner qualify as a private employment agency for purposes of
   charging Iowa sales tax?
2. Are services performed by the temporary medical workers subject to Iowa sales
   tax?

III.

STANDARD OF REVIEW
A. Declaratory Orders under the Iowa Administrative Procedure Act
Iowa’s Administrative Procedure Act (“IAPA”) was enacted “to provide a minimum

procedural code for the operation of all state agencies when they take action affecting the rights
and duties of the public.” Iowa Code § 17A.1(2). Under the IAPA, “[a]ny person may petition an
agency for a declaratory order as to the applicability to specified circumstances of a statute,
rule, or order within the primary jurisdiction of the agency.” Id. at § 17A.9(1)(a). The IAPA also
describes agency rights and responsibilities with respect to declaratory order proceedings. Id. at
§ 17A.9(8). Pursuant to Iowa Code section 17A.9(2), the Department adopted Iowa

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Administrative Code rule 701—4.7, which outlines department-specific rules governing
declaratory orders.
The purpose of a declaratory order is to provide a “generally available means for
persons to obtain reliable information about agency administered law as it applies to their
particular circumstances.” Sierra Club Iowa Chapter v. Iowa Dep’t of Transp., 832 N.W.2d 636,
647 (2013) (citing Arthur Earl Bonfield, Amendments to Iowa Administrative Procedure Act,
Report on Selected Provisions to Iowa State Bar Association and Iowa State Government, 1–8
(1998)). Declaratory orders are not contested cases that “entitle[] parties affected by the agency
action to an adversarial hearing” in order to “adjudicate disputed facts pertaining to particular
individuals in specific circumstances.” Greenwood Manor v. Iowa Dep’t of Pub. Health, State
Health Facilities Council, 641 N.W.2d 823, 834 (Iowa 2002); see also Iowa Code § 17A.12.
Instead, the IAPA “contemplates declaratory rulings by administrative agencies on purely
hypothetical sets of facts.” City of Des Moines v. Pub. Emp’t Relations Bd., 275 N.W.2d 753,
758 (Iowa 1979).
As such, “[t]he procedure established by section 17A.9 allows persons to seek formal
opinions on the effect of future transactions and arrange their affairs accordingly.” Bennett v.
Iowa Dep’t of Nat. Res., 573 N.W.2d 25, 26 (Iowa 1997). Declaratory orders issued by an
administrative agency do, however, have “the same status and binding effect as any final order
issued in a contested case proceeding.” Iowa Code § 17A.9(7). The Department’s rules
governing declaratory orders are consistent with this understanding of the role of declaratory
orders in administrative procedure. See Iowa Admin. Code r. 701—4.7.
B. Statutory Construction and Interpretation of Tax Statutes
“When engaging in statutory interpretation,” the Department “first examine[s] the
language of the statute and determine[s] whether it is ambiguous.” Kay-Decker v. Iowa State
Bd. of Tax Review, 857 N.W.2d 216, 223 (Iowa 2014) (citing Rolfe State Bank v. Gunderson,
794 N.W.2d 561, 564 (Iowa 2011)). “‘Generally, we presume words used in a statute have their

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ordinary and commonly understood meaning.’” Id. (quoting McGill v. Fish, 790 N.W.2d 113, 119
(Iowa 2010)). “[L]egislative intent is expressed by what the legislature has said, not what it could
or might have said. When a statute’s language is clear, we look no further for meaning than its
express terms. Intent may be expressed by the omission, as well as the inclusion . . . of
statutory terms . . . .” Hawkeye Land Co. v. Iowa Utils. Bd., 847 N.W.2d 199, 210 (Iowa 2014)
(quoting State v. Beach, 630 N.W.2d 598, 600 (Iowa 2001)).
In addition to applying the general principles of statutory construction, “[s]tatutes which
impose taxes are construed liberally in favor of the taxpayer and strictly against the taxing body.
It must appear from the language of a statute that the tax assessed against the taxpayer was
clearly intended.” Iowa Auto Dealers Ass’n v. Iowa Dep’t of Revenue, 301 N.W.2d 760, 762
(Iowa 1981).
IV.

DISCUSSION
A. Taxability of Services Performed by a Private Employment Agency
The first question presented in the Petition is whether the Petitioner qualifies as a private

employment agency for purposes of Iowa sales tax. Petitioner argues that the medical facility
owes the Petitioner Iowa sales tax for both the initial fee for the placement of the temporary
medical worker and the subsequent and ongoing hours worked by the temporary medical
worker. However, Petitioner has indicated that the medical facility does not believe that they
owe Iowa sales tax to the Petitioner. Iowa Code section 423.2(5) imposes “a tax of six percent
upon the sales price from the furnishing of services as defined in section 423.1.” Iowa Code §
423.2(5). Iowa Code section 423.1 defines services as “all acts or services rendered, furnished,
or performed, other than services used in processing of tangible personal property for use in
retail sales or services, for an employer who pays the wages of an employee for a valuable
consideration by any person engaged in any business or occupation specifically enumerated in
section 423.2.” Id. § 423.1(54). The six percent sales tax on services is imposed only on certain
enumerated services listed in Iowa Code section 423.2(6). Included in this list of enumerated

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services are “[p]rivate employment agencies, excluding services for placing a person in
employment where the principal place of employment of that person is to be located outside of
the state” Id. § 423.2(6)(aq).
Iowa Code section 423.2(6)(aq) is implemented by Iowa Administrative Code rule
701—211.13. This rule defines a private search agency as an entity that is “engaged in the
business of providing listings of available employment, counseling others with respect to future
employment, or aiding another in any way to procure employment.” Iowa Admin. Code
r. 701—211.13(1). Whether the agency is providing services to an employee or an employer,
the service is subject to tax. Id. However, when the search agency places an employee so that
their principal place of business is outside of Iowa, that service is not subject to tax. Id. r.
701—211.13(2). According to the facts above, Petitioner’s website provides listings of available
employment for prospective job seekers. Petitioner also works directly with facilities or job
seekers to find qualified employment. These facts demonstrate that Petitioner is often engaged
in the business of placing employees at medical facilities, and generally fits within the definition
of a private employment agency under Iowa Administrative Code rule 701—211.13. When
employees are placed in the state of Iowa, that service is subject to sales tax under Iowa Code
section 423.2(6)(aq).
In the present situation, Petitioner has placed a temporary medical worker at a medical
facility in Iowa. Whether that placement is subject to Iowa sales tax in this situation depends on
the specific facts, and whether it meets the requirements of Iowa Administrative Code rule
701—211.13. According to the facts presented by the Petitioner, the Petitioner is responsible for
employing and paying the temporary medical worker. The temporary medical worker is
employed by the Petitioner, but only works under the supervision of the medical facility. In order
for the service to be taxable under Iowa Administrative Code rule 701—211.13, Petitioner must
have engaged in “aiding another in any way to procure employment.” Under the facts presented,
the temporary medical worker is employed by the Petitioner, not the medical facility. So the

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Petitioner has not aided the temporary medical worker to procure employment, nor have they
aided the medical facility in finding an employee. Therefore, the Petitioner has not performed a
service subject to tax under Iowa Code section 423.2(6)(aq) and Iowa Administrative Code rule
701—211.13.
B. Taxability of Services Performed by the Temporary Medical Worker
The second question posed in the Petition asks whether the services performed by the
temporary medical worker are subject to Iowa sales tax. As concluded above, Petitioner did not
perform a taxable service by placing the temporary medical worker at the medical facility.
Petitioner is not performing any additional services for the medical facility. Any additional
services are being performed by the temporary medical worker. The Petition states that the
primary activities of the temporary medical employees are “administering anesthesia and
monitoring patients for in and outpatient procedures.” Pet. at 1, No. 913661 (April 29, 2025).
The Director may refuse to issue an Order when the conclusion would “necessarily determine
the legal rights, duties, or responsibilities of other persons who have not joined in the petition,
intervened separately, or filed a similar petition.” Iowa Admin. Code r. 701—4.7(10)“a”(9). Since
the temporary medical worker is the one performing the services, not the Petitioner, determining
whether those services are subject to sales tax would be determining the sales tax responsibility
of an individual that is not a party to this Order. For the purposes of this Order, the Director will
only determine the taxability of the services performed by the Petitioner for the medical facility.
C. Conclusion
In summary, Petitioner is a private employment agency that provides employment
services. The work of private employment agencies is a taxable service under Iowa Code
section 423.2(6)(aq) and Iowa Administrative Code rule 701–211.13. However, under the facts
provided, the temporary medical worker is employed by the Petitioner, so the Petitioner has not
placed an employee in the state of Iowa and has not performed a taxable service. In regard to
the services performed by the temporary medical worker, since the services are not being

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performed by the Petitioner, no tax is due to the Petitioner by the medical facility, and for the
purpose of this Order the Director refuses to issue an Order on the taxable relationship between
the medical facility and the temporary medical worker.
ORDER
THEREFORE, based on the facts presented, foregoing reasoning, and applicable
provisions of the law, the Director finds that since the Petitioner has not placed an employee in
the state of Iowa they have not performed a service subject to sales tax. Additionally, the
Director refuses to issue an Order on the taxability of the services performed by the temporary
medical worker because the medical worker is not a party to this Order.
Issued at Des Moines, Iowa this ____
27th day of August, 2025.
IOWA DEPARTMENT OF REVENUE

By ______
Mary Mosiman, Director

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