The International Fuel Tax Agreement (or IFTA) is an
agreement between the lower 48 states of the United States and the Canadian
provinces (except Northwestern Territories, Nunavut and Yukon), to simplify the
reporting of fuel use by motor carriers that operate in more than one
jurisdiction. This simplifies the process of reporting quarterly fuel tax returns.
This tax is required for motor vehicles used, designed,
or maintained for transportation of persons or property and:
1. Having two axles and a gross vehicle weight rating or
registered gross vehicle weight in excess of 26,000 pounds, and/or
2. Having three or more axles regardless of weight,
and/or
3. Is used in combination, when the weight of such
combination exceeds 26,000 pounds gross vehicle or registered gross vehicle
weight.
Exceptions exist for Recreational Vehicles (such as
motor homes, pickup trucks with attached campers, and buses when used
exclusively for personal pleasure by an individual). Some states have their own
exemptions that may apply to farm vehicles or government vehicles, so check
your state for their specific exemptions.
The IFTA license offers several benefits to the
interstate/inter-jurisdictional motor carrier. These benefits include one
license, one set of decals per vehicle, one quarterly fuel tax report for all
vehicles that reflects the net tax or refund due. Tax returns are required even
if no operations were conducted or no taxable fuel was used during the
reporting period. Returns that are not filed or not paid in full are considered
late and will be assessed penalty and interest.
When filing a tax return, a licensee may apply the fuel
overpayment generated in one jurisdiction to the taxes owed for another
jurisdiction. These advantages result in cost and time savings for the carrier
and the member jurisdictions.
Under IFTA, you are able to file one return in your
base jurisdiction and that jurisdiction will allocate the money
appropriately. This agreement definitely
simplified what used to be a very long and time-consuming process. At TruckServices of North America, we make it even simpler by preparing and filing your
quarterly returns for you. TSNA takes the paperwork out of your way. Contact us at tsnamerica.com or call
803.386.0320.
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