When you’re an owner-operator or a fleet manager of a trucking firm, you have a lot of numbers you must track – miles per state, fuel purchases, driver settlements, tolls, tools – you name it, there’s a number attached to it. To manage your trucking business expenses, you need a system.
The IFTA quarterly fuel tax filing must be paid every 3 months. You’ll need a record of the miles per state and fuel purchases for the last quarter. Then the taxes per jurisdiction are computed using the current tax rates.
This task is complicated. Tax rates change without notice. Accurate numbers are critical because failure to file on time or accurately can trigger fines and penalties. Managing all these numbers without a good system is asking for trouble.
A good IFTA reporting software won’t need a driver or an owner-operator to spend time on it beyond asking for a report. Instead of wasting time entering data, an IFTA preparation software can use the numbers and records generated during dispatches and routing. It will take the fuel purchase records and compute the report accurately and quickly.
Some truckers might set aside monies to may this tax based on an estimate of their taxes per week or per month. It can be a small amount for a trucker hauls regionally and a big bite for those who cross the country. Managing this trucking business expense can be a time suck, or it can be a 3-minute task every few months. The difference is the right software.
The International Registration Plan simplified the system for long-distance truckers. Instead of dozens of license plates to purchase and renew, a single plate that requires two tax payments per year reduces most of the headaches that the old system created. But like IFTA, the taxes due are based on the mileage per state.
Doesn’t it seem logical that you use the same numbers for IRP as you would for IFTA?
One thing that truckers need to know: this year, some jurisdictions have granted waivers due to the COVID-19 pandemic. Truckers will need to check their base IRP jurisdiction offices regarding due dates.
The Heavy Vehicle Usage Tax requires one annual payment that’s due every August. Instead of being based on mileage, this tax is a flat rate for all trucks that qualify. As it’s a predictable amount, saving up for it might not be important to a fleet manager or owner-operator. It’s probably easy enough to make a payment with a credit card… except you can’t. The IRS is not currently taking credit card or debit card payments, but they will take an Electronic Funds Withdrawal.
Trucking Business Expenses
Besides the government requirements, we have to manage our trucking business in a way that’s going to make money. There’s a lot to manage. All businesses have expenses they have to track in order to be sure they’re making money.
IFTA requires truckers to track fuel purchases, but fuel isn’t the only trucking business expense. All businesses have basic expenses – rent or mortgage, utilities, supplies. Truckers also have to manage maintenance records and scheduling. Fleet managers have driver settlements. Long-distance drivers have other expenses.
How do you know if you’re making money? You have to know what you’re spending. We all look for the golden load – the perfect load with the high pay per mile – but we don’t always get them.
How to Improve the Cash Flow in Your Trucking Business
Financial experts tell you that to improve cash flow, you need to cut costs and increase profits. But you’ve probably learned by now that it’s not as easy as it sounds. One day you’re making lots of money; the next day, you’re wondering where to get the money for your IFTA taxes.
Of course, following a solid business plan can work in some ways. It helps you stick to your long-term goals and know where your company is headed. But, what about those everyday little expenses that can pop up and empty your bank account? How do you prepare for those? One way is to know where your money is, and how much you can stash back.
To accomplish the seemingly impossible goal of saving money, you’ll need trucking software that keeps track of your incoming and outgoing cash. For instance, with TruckingOffice TMS, you can generate reports that help you see where to cut down on expenses and ultimately improve your cash flow.
We could list many recommended ways to improve your cash flow, but without the accurate and reliable record-keeping of our TMS, those ideas may prove worthless. Discover the many benefits of our TMS with the free trial offer above and start saving money today.
Do you know how much it costs you to haul a load?
In the end, you can control your money flow by controlling how much you spend. It’s like your weight – you can exercise, but it’s about controlling the food going into the body. Financial stability and growth is about controlling what goes out of your pocket.
That’s why the most critical number you as a trucker need to know is your revenue per mile. How much money is in your pocket after you pay off the expenses of a load and get paid for it?
Since our expenses go out long before we get paid, it’s hard to remember them to figure out if a particular load made you a profit. When you run your business on a cash basis, you can’t tell how much money you’ve made on a load because the expense and the payment are so far apart.
Revenue is not just the payment: it’s effectively the net profit after you deduct expenses.
That’s why tracking your expenses shows you where you’re losing money. Too many drive through coffees? Problems with your engine? How much windshield cleaner do you need to buy at one time? You can make the best decisions with the best data.
Which is why you need a full trucking management software like TruckingOffice.
TruckingOffice does it all – at the same time.
When you pull out of your yard, you’re already putting on miles before you pick up your load – but is still part of your miles per state for IFTA and IRP. When you stop to get fuel and pick up a new set of wiper blades, you’re spending money that doesn’t apply to the load in your trailer right now. Even your insurance premiums don’t cover just one load. All of these expenses apply over multiple loads. Do you need to track them too?
Only if you want to know the exact number you need to decide if a load is worth hauling. Aren’t you tired of guessing that some load is worth it and discover later that you took a big loss?
Maybe it’s time to change to a trucking management software that does it all – and makes it easy at the same time. That’s what TruckingOffice does.
- You create a dispatch and PC*Miler routes the trip.
- You add in your trip expenses while you’re on the road so you don’t forget anything.
- Create an invoice while you’re in your cab on your smartphone to send the shipper before you’re out of the yard. You’ll get paid faster with fewer problems when you can include a picture of the signed BOL on the same day that you make the delivery.
- Your maintenance records will be perfect when you add your tires, oil changes, and brakes into our all-in-one system.
- Ongoing trucking business expenses like insurance and loan payments can be – should be! – added to TruckingOffice so you know where your money is going.
- If you hire a driver, you can maintain all that trucker’s records as well, including medical checks, CDL dates, and payments for loads.
- When it’s time, you can get a fast and accurate report showing your IRP and IFTA taxes.
Then you’ll be able to avoid those loads at a loss.
Manage your trucking business expenses with TruckingOffice TMS right now – at no charge. We’ll let you take TruckingOffice out for a spin with no credit card, debit card, or checking account number. You’ll see the whole system and discover what freedom you’ll have when everything is done with one program. Sign up today for our free trial!