Our software makes IFTA reports easier to file. This is important because staying on top of IFTA matters is one of the most important duties of a transportation professional. Fortunately, TruckingOffice makes the task fast and easy, giving you more time to do the one thing that actually puts money in your pocket: driving.
The ABCs of IFTA
IFTA stands for International Fuel Tax Agreement. It refers to a plan set up between 48 US states and 10 Canadian provinces. This doesn’t apply to Alaska, Hawaii, or the three northernmost provinces. serves the following purposes:
- Simplifying the payment of taxes across state and national borders.
- Ensuring that each entity receives its share of tax revenue.
- Reducing the number of decals, forms, etc., that truckers must keep track of.
The IFTA is designed to make tax matters simpler for everyone involved. Filing IFTA reports on a timely basis and making sure your fuel taxes are paid is your responsibility as a transportation professional.
Who the IFTA Applies to
The IFTA applies to you if you meet the following criteria:
- Your truck has a gross vehicle weight (GVW) of 26,000 pounds or has three or more axles or both. For example, if your truck has a GVW of 25,000 pounds but has three axles, then you fall within IFTA jurisdiction. Or say your truck has only two axles but has a GVW of 27,000 pounds – in that case you are also under the IFTA. This includes so-called “piggyback” combos that have a GVW of at least 26,000 pounds.
- You use the truck across state lines for commercial purposes; i.e. transporting goods.
Personal or recreational vehicles, such as RVs, are not covered by the IFTA.
What the IFTA Requires You to Do
Complying with IFTA basics requires you to do a few important things:
- Display a current IFTA decal on your truck at all times. Each year’s decal expires on January 1st of the following year. For example, a 2014 decal will expire on the first day of 2015. The DMV allows a grace period until the end of February to renew the decal. In the prior example, a driver whose 2014 decal expired would have through February 28, 2015 to get a new one. After this date, drivers who do not comply will be subject to fines.
- Complete and submit an IFTA report every 90 days. The deadlines for these IFTA reports are April 30th, July 31st, October 31st, and January 31st.
- Pay all the IFTA taxes due by the deadlines.
- Maintain all fuel tax records for a period of at least four years.
- Have records on hand in your office at all times.
- Allow a DMV auditor access to these records upon request. The auditor may examine your forms and receipts to ensure that you are complying with the law.
Are There Any Extensions Due to COVID-19?
Each jurisdiction is responsible for establishing any COVID-19 related IFTA reporting extensions. Unfortunately, many of the extensions that were granted have expired. However, the IFTA Industry Advisory Committee issued a statement strongly urging states and provinces to consider extending the IFTA sticker, tax filing, and payment deadlines. Some of the reasons for their request include:
- Further disruption of vital carrier operations due to suspended licenses.
- Collecting penalties from thousands of licensees who were not responsible for their tardiness will be an enormous challenge.
- Nothing in the IFTA agreement prevents jurisdictions from extending the filing and payment dates.
- Nearly all IFTA licensees are affected by today’s unusual conditions and are unable to file on time. A blanket extension would avoid a range of difficulties for everyone involved.
- With many jurisdiction offices closed, would they be able to process filings and payments even those that are on time?
Other tax extensions could also help truckers during this trying time. For instance, suspending the 12% Federal Excise Tax would help increase sales of new trucks. The newer trucks have advanced safety features that would improve highway safety and reduce emissions.
If you want more information about IFTA extensions, contact the office in your base jurisdiction to get current updates.
The Key to Complying with the IFTA
Above all else, the following things are vital to understanding IFTA:
- Be organized.
- Be organized.
That point is so important that it’s worth repeating. Keeping all your ducks in a row is essential for staying on top of fuel tax matters. If you don’t, then the consequences can include heavy fines and other problems. Luckily, TruckingOffice makes keeping track of these regulations simple. Our software’s cutting edge features do all the busy work for you, making sure that you pay exactly what you owe and not a penny more. And you’ll be surprised at how easy it is to use. Find out for yourself by taking TruckingOffice for a free test drive starting today. You won’t even need a credit card or checking account to get started.