Newcomers to the trucking industry want to know what IFTA is and whether it applies to their operation. Here are a few of the IFTA basics they need to know.
The International Fuel Tax Agreement allows member jurisdictions to collect and fairly distribute motor carrier fuel use taxes. Before the IFTA, truckers needed a fuel permit for each state on their route. It was an inefficient, costly method that is much simpler today thanks to the IFTA. Today, motor carriers only need one IFTA sticker displayed on the outside of each cab in their fleet.
If your vehicle meets qualifications, you can register online with your base state. Create an account and IFTA login. If your state doesn’t have a website, your registration forms can be sent by mail or fax. After registering, you are required to report fuel use quarterly to your base state. Delinquent filing is subject to fines, penalties, or downtime.
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When filing your IFTA tax returns every quarter you will need to know how many miles your trucks have traveled in each state/province, and you will need to know how many gallons of fuel your trucks purchased in each state/province.
Collecting the miles by state is often times the most difficult part of maintaining good IFTA records. Some drivers go by their odometer readings and each day they record the miles per state on a mileage log. Other companies require their drivers to record these miles on their log book each day with a state by state breakdown. Any manual method of tracking your miles by state quickly becomes very tedious and troublesome. It’s just too easy to have inaccuracies. Drivers forget to write down the miles, or they don’t really care if they are accurate or not. If you don’t have accurate miles by state then you will probably be paying too much on your IFTA tax forms.
The other problem is tracking the fuel gallons by state. This one is a little easier. You might have a stack of receipts that can be totalled up, then sorted by state. A lot of people use a spreadsheet for this task, and that works fine. It is still very tedious and time consuming. Getting a fuel card helps organize fuel purchases, and is an effective way to track your gallons by state. The main thing is make sure that no fuel purchases are missing. Once again inaccurate records will cause you to pay too much IFTA taxes.
IFTA Trucking Software makes IFTA easy.
Some IFTA software programs offer you a method of tracking the miles and gallons by state but you have to enter all of your own information. TruckingOffice is the best IFTA management software available. TruckingOffice provides the miles for you automatically. All you have to do is enter in all of your trips as dispatches and TruckingOffice will calculate all miles driven and report them back to you by state. All miles are provided by PC*Miler practical miles. PC*Miler is completely integrated making it very easy to use. TruckingOffice provides a comprehensive IFTA report that displays all of your miles (empty, loaded, and toll) and all of your fuel gallons by state/province making your IFTA forms easy to fill out. To see a complete list of features go to the features page on our website.
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