What is IFTA in trucking?
What is IFTA? The IFTA agreement allows for easy reporting of fuel taxes across states and provinces. The International Fuel Tax Agreement (IFTA) is a cooperative deal between the United States and Canada which simplifies tax payments by enabling truckers to report their items on one form that they fill out as though it were filed in only one country – whichever state or province he/she was driving through last. This makes things much simpler if you are driving around, say from New York State down to Florida, since now all your gas purchases will be documented with just an interstate credit card swipe at any fueling station along the way! See our Fuel Tax Bond page for more.
What are IFTA requirements?
Did you know that the IFTA requirements require truck owners to register their vehicles? If your vehicle has more than two axles and a gross weight of 26,000 pounds or if it's towed by another vehicle with combined weights higher than this amount then registration is required. The best part about registering for an IFTA license plate is that there are no fees!
IFTA requirements will help you know what to do if your truck falls into any of the following categories:
-Truck has two axles and a GVW exceeding 26,000 pounds.
-Transports goods or people across different states/provinces.
-Truck with trailer weight exceeds 10% of its gross vehicle weight (GVW).
What is the purpose of IFTA?
As a business owner, if you're registered in one of the IFTA jurisdictions it's important to know that your qualified motor vehicles can travel without having to get a different license for each. All qualifying fleet operators are only required to file taxes with their base jurisdiction at the end of every quarter and this is where they report on all fuel usage drives and miles traveled by their company car or truck across any transactions happening within an Interstate Fuel Tax Agreement (IFTA) territory as well as other documentation such during any taxable activity
In short: If someone operates more than just one vehicle, then he/she needs simply register his/her eligible cars under single-fleet licensing which will allow them freedom from paying out income tax separately per state.
How does the IFTA tax Work?
For drivers, carriers and jurisdictions alike IFTA has simplified the process of paying fuel taxes. Fuel is taxed at the pump by each individual state which then distributes these funds based on how many miles are driven in that specific jurisdiction. Drivers can thank IFTA for making their lives easier. With one simple tax rate, they no longer have to calculate the taxes on each state independently and figure out how much is owed to which states. All drivers must do now is pay at the pump and know that it's taken care of!
Who Files IFTA?
The IFTA is a tax on the use of qualified motor vehicles for interstate transportation. Qualified motor vehicles used or designed to transport people are subject to this tax, as well as cargo and property-carrying commercial semitrailers that have either three axles or two axles with gross vehicle weight in excess of 26,000 pounds (11797 kilograms).
Which States Do Not Participate in IFTA?
The following states don't have IFTA credentials (that is, here are several jurisdictions that do not participate in Ifta), including: Hawaii, Alaska, and Washington D.C. Further, Nunavut, Yukon, and the Northwest Territories do not participate in IFTA.