Want to Avoid an IFTA Audit? Avoid These Errors!

The 1st Quarter IFTA deadline is getting closer and closer, and we need to focus on avoiding an audit.

We’re gonna take this step by step, and focus on the heavy hitters.

The following are some of the red flags IFTA auditors keep their eyes out for:

Non-continuous Jurisdictions

Alright, this is kind of obvious, but it happens. Your trip logs must show continuity from your starting point to your destination. That includes every district in between.

There’s no way your vehicle began in New Jersey and then suddenly showed up in Ohio. Make this kind of error, and an auditor will be knocking on your door in no time.

Gaps in Mileage

If your end of day trip logs don’t match up with the beginning of the next day, you got yourself a mileage gap.

This usually happens because drivers don’t realize that their personal or leased miles must also be included on the trip logs.

Over-simplified Fuel Calculations

When reporting fuel, it is not acceptable to divide your miles traveled by a predetermined Miles Per Gallon estimate as MPG will naturally fluctuate. The precise fuel use and mileage must be recorded.

Skewed MPG

If your average MPG has drastic variations from one quarter to the next, without a legitimate reason such as differing road conditions, varying weights of the loads carried, etc, an audit could be triggered.

Excessively High/Low MPG

The average MPG for a heavy vehicle is between 5-10 MPG.

If your MPG falls outside of this range, you probably made an error in calculations.

The tough part is, some states won’t let you file your IFTA return until your MPG is within that acceptable range.

However—even if you avoid these obvious errors—you can still be chosen at random for auditing.

Give us a call at 803.386.0320 or fill out our service request form today!

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Common IFTA Mistakes

Truck Services of North America receives many questions about the requirements of IFTA.  Here are a couple common mistakes that can be quite costly for IFTA license holders.

I do not have to file a quarterly return since I did not operate.

Many IFTA license holders assume that if they do not have any mies to report, that they do not have to file a quarterly IFTA return. This is not the case, if you hold a valid IFTA license, you are required to file a quarterly return by the deadline, even if no miles were traveled.  In the instance of no operations, you would simply file a zero return and no tax will be owed.  However, if you fail to file the zero return by the quarterly deadline, you will be responsible for the late filing penalty fee.

If I do not renew my IFTA license at the end of the year, my IFTA account will automatically be closed and I will not be required to continue to file quarterly returns.

This is not always true and depends on your state.  The process to close your IFTA account varies from state to state.  Some states revoke and close IFTA accounts as soon as you fail to file for one or two quarters.  Others close the account at renewal time, while others allow the account to remain open and each quarter that is late, is subject to the late filing penalties and interest for any tax due. You want to check with your state to find out what is required to close your IFTA account if you are going out of business or easing operations for any reason.  We have had customers who have been required to file over 4 years of outstanding IFTA returns, because they failed to close their account with the state.

TSNAmerica works very closely with state IFTA offices and can assist you in setting up, maintaining and closing your IFTA account.  We keep you informed of deadlines, file your quarterly returns and notify you of changes in rules and regulations, should they occur.

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Be Prepared For An IFTA Audit

Base jurisdictions are required to audit 3% of the IFTA accounts that are required to report per year, excluding new accounts.  You can prepare yourself by keeping accurate records.

Supporting Documents Required:

1. Completed copy of a driver trip record or trip sheet from one of the 12 most  recent quarters.

• Date of the trip (starting and ending)

• Trip origin and destination
• Route of travel and/or beginning and ending odometer or hubometer reading of the trip
• Total trip miles or kilometers
• Miles/kilometers by jurisdiction
• Unit number or vehicle identification number
• Vehicle fleet number
• Registrant's name
• Trailer number
• Driver’s signature and/or name
• Fuel Purchases

1. Copy of an actual Over-the-Road fuel receipt.
2. Completed copy of a bulk fuel withdrawal log, if applicable.
3. Copy of monthly or quarterly summary, if applicable.
4. Detailed equipment list including the make, model, and gross weight for IFTA qualified units.

Your Distance Records should include taxable and non-taxable fuel use, distance traveled for each, and distance traveled in each jurisdiction.

Fuel Records should include date of receipt, name and address where fuel was purchased, number of gallons purchased, and fuel type.  Separate records must be kept for each fuel type and bulk fuel purchases.  If you operated under a trip permit, keep a copy of that permit and do not record those fuel purchases on your IFTA report.

You want to be sure that your reports are accurate and legible, including your fuel receipt copies.  All information needs to be complete with no gaps between mileage. Incomplete, inconsistent or illegible records may require you to produce secondary documents.

You are required to keep your records for 4 years from the return due date or filing date, whichever is later, plus any time period included as a result of waivers or jeopardy assessments.

If a licensee fails to provide the required records for audit, the 4 year retention requirement is extended until the required records are provided.

At Truck Services of North America, we prepare and file your quarterly returns for you. TSNA takes the paperwork out of your way.  Check out all our services at TSNAmerica.com and fill out the Service Request Form, email us at support@TSNAmerica.com or call 803.386.0320.

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IFTA Filing Services

The filing period for 1st Quarter IFTA opens April 1, 2014. Truck Services of North America can prepare and file for your.  We have packages to suit your needs, from the very basic to the complete.

We have the following IFTA Packages:

• IFTA Basic: $75 Quarterly + State Fees
  

  • Send us total miles and fuel purchased per state at the end of the quarter and we file for you.

• IFTA Premium: $95 Quarterly + State Fees (additional vehicle fees will apply)
  

  • Send us copies of trip sheets & fuel receipts and we calculate and file for you. Does NOT include auditing. We report the information exactly as we receive and no questions asked. Send on monthly basis and save $15 per quarter! (Info due no later than the 15th of the following month to qualify for the discount!)

• IFTA Complete: $150 Quarterly + State Fees (additional vehicle fees will apply)
  

  • Send us copies of trip sheets & fuel receipts, we calculate AND audit the information. Auditing includes checking state adjacency, missing miles & fuel reported. Information MUST be submitted on a monthly basis. (Price reflects monthly discount. Information due no later than the 15th of the following month, if received after the 15th late fees may be incurred.)

These packages are for IFTA Services only, any state use tax filings are additional. If you would like to use our IFTA Filing Service, simply choose your package and let us know and we’ll take the paperwork out of your way!

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TSNAmerica Can Prepare & File Your Quarterly IFTA

March marks the final month of 1st Quarter for IFTA.  IFTA is the International Fuel Tax Agreement, 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. 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.

The deadline to file your 1st Quarter IFTA return is April 30, 2014.  Good record keeping now helps you avoid rushing around at the last minute and possible lates and/or penalties.

Who is required to file?

This tax is required for motor vehicles used, designed, or maintained for transportation of persons or property and:

• Having two axles and a gross vehicle weight rating or registered gross vehicle weight in excess of 26,000 pounds, and/or
• Having three or more axles regardless of weight, and/or
• 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.

What is Required?

The following information is required on the IFTA quarterly tax return:

• Total miles, taxable and nontaxable, traveled by the licensee’s qualified motor vehicles in all jurisdictions, IFTA and non-IFTA, including trip permit miles;
• Total gallons of fuel consumed, taxable and nontaxable, by the licensee’s qualified motor vehicles in all jurisdictions, IFTA and non-IFTA;
• Total miles and taxable miles traveled in each member jurisdiction;
• Taxable gallons consumed in each member jurisdiction;
• Tax-paid gallons purchased in each member jurisdiction; and
• Current Tax Rates for each member jurisdiction.

As a premier processing agency, Truck Services of North America can set up your IFTA accounts and file your Quarterly IFTA Taxes for you.  You just send us the required information and we handle the rest!

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Trucker Services Packages

As a premier processing agency, Truck Services of North America takes care of filing the necessary paperwork on your behalf for registrations, renewals, quarterly taxes, permits and more so you don’t have to mess with it, allowing you to stay focused on the road.

At TSNA, we have packages to assist you and can customize a package to meet your individual needs.  We offer many services, and here a few:

• Basic Authority Package - $600
• FMCSA Interstate Operating Authority
• US DOT Number
• BOC-3
• EIN Number

• Premium Authority Package - $800*
• All of the services included in the Basic Authority Package
• UCR
• IFTA
• IRP
• Form 2290 HVUT

• Complete Authority Package - $950*
• All of the services included in the Premium Authority Package                
• KYU Number               
• NYHUT
• OR Weight-Mile Tax
• NM WD

*( Price for Premium & Complete Authority Packages do not include all state and federal fees.)

Let TSNA navigate your business through the maze of paperwork! Check out all our services at TSNAmerica.com. Don’t see what you are looking for?  No problem, simply fill out the Service Request Form and note the service you require in the message section and we will contact you for details.  Of course you can always email us at support@TSNAmerica.com or call 803.386.0320. TSNA takes the paperwork out of your way!

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4th Quarter IFTA & Use Tax Returns Past Due

If you have not yet filed your 4th Quarter IFTA or Highway Use Tax Return, you missed the deadline! With some returns, there is a late fee and interest accrues daily so you want file as soon as possible to avoid further penalties and interest.  

Failure to file an IFTA return, filing a late return, or failure to remit any or all tax due will result in a penalty of $50.00 or 10% of the net tax due to all member jurisdictions, whichever is greater.  Interest is computed on all delinquent taxes dues each jurisdiction at a rate of .4167% per month.  Even if you have a net refund, interest still applies to each jurisdiction for any underpayment of fuels use tax to that jurisdiction and is calculated beginning the day after the due date of the return for each month, or fraction of a month, until paid. So the longer you are late, the more you will owe.

At Truck Services of North America, we make it simple by preparing and filing your quarterly returns for you, so you can avoid further penalties. TSNA takes the paperwork out of your way.  Check out all our services at TSNAmerica.com and fill out the Service Request Form, email us at support@TSNAmerica.com or call 803.386.0320.

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New Entrant Safety Audit

The FMCSA has a safety evaluation program called the “New Entrant Safety Audit." The new entrant’s roadside safety performance will be closely monitored to ensure the new entrant has basic safety management controls that are operating effectively.  

If the audit discovers that adequate safety controls are not present, the carrier has 60 days from the date of the notification (45 days if transporting hazardous materials or passengers) to take the actions specified in the notice, and to submit proof that it has remedied its safety management practices. If the carrier does not, they must cease operations on the 61st day. If the carrier is making a good faith effort, the FMCSA may extend the 45 or 60 days to give the carrier more time to comply.

Here are just some of the things you can do to avoid an audit:

1. Make sure all drivers have a valid commercial driver’s license (CDL) with all required endorsements.
2. Make sure you have the required levels of insurance
3. Correct all safety violations before operating the vehicle
4. Take required random drug tests
5. Keep all records of inspection and maintenance
6. Always have a security plan when offering or transporting hazardous materials

The penalties for noncompliance vary, depending upon the severity and frequency of the offense.  Some fines can continue to accrue if left unchecked. For more safety violation information see the FMCSA website at www.fmcsa.dot.gov/registration-licensing/NewEntrant.

Let TSNA navigate your business through the maze of paperwork! Check out all our services at TSNAmerica.com. Don’t see what you are looking for?  No problem, simply fill out the Service Request Form and note the service you require in the message section and we will contact you for details.  Of course you can always email us at support@TSNAmerica.com or call 803.386.0320. TSNA takes the paperwork out of your way!

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2014 IFTA Renewal Deadline Nears

The 2014 IFTA Renewal deadline is almost here.  The renewal process varies from state to state with some states offering online renewal and others require electronic renewals, while others renew IFTA licenses automatically as long as the carrier is current with quarterly filings and any monies due.  Some states require that all paperwork be received in the office BEFORE the December 31st deadline, to allow enough time to process the paperwork by the deadline.

Your IFTA license will not be renewed if your account is not in good standing.  What that means is you are current with your Quarterly IFTA filing and no money is due.  If you missed any quarterly filing, you will want to file immediately so your IFTA license will be renewed.

If you do not receive renewal papers in the mail, it does not mean you do not have to renew.  You are still responsible to renew your IFTA license by the December 31st deadline.  Carriers renewing their IFTA license and decals have a two-month grace period (January and February) to display the renewal IFTA license and decals. The two month grace period is for display of renewal credentials, and does NOT apply to submitting renewal application for those credentials. Your renewal application must be submitted by the deadline to be considered on time. Renew your IFTA license on time to avoid possible penalties.

As a premier processing agency, Truck Services of North America can assist with renewing your IFTA.  TSNA takes the paperwork out of your way.  Check out all our services at TSNAmerica.com and fill out the Service Request Form, email us at support@TSNAmerica.com or call 803.386.0320.

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