Automate Your IFTA Reporting with TMS Software

TMS software can help automate IFTA reporting. Know all about IFTA reporting and how TMS software assists in automating IFTA reporting for trucking companies. 

After our transportation management system, LoadStop, was launched, several trucking companies have expressed interest in how our TMS software can assist them with their IFTA (International Fuel Tax Agreement) tracking for filing their quarterly IFTA report. 

What is IFTA Reporting?

What is IFTA reporting? The International Fuel Tax Agreement (IFTA) is an agreement between the 48 contiguous US states and 10 Canadian provinces that aims to simplify fuel usage reporting for motor carriers operating in multiple jurisdictions. 

Previously, each state had its own unique set of fuel tax reporting rules and regulations. Under IFTA, carriers now only need to report fuel usage to their base jurisdictions, which collect taxes on net fuel usage and disburse funds to other states.

Overall, the International Fuel Tax Agreement (IFTA) streamlines the process of transferring fuel taxes across different states.

It's important to remember that IFTA doesn't impose an additional tax. Rather, its purpose is to redistribute the tax to the states where the fuel is consumed, as opposed to where it's bought. 

This implies that regardless of where you purchase the fuel, you'll be charged the fuel tax in the states where you're driving.

IFTA Reporting Requirements: Who's Required to Follow It?  

Let's discuss IFTA reporting requirements. IFTA reporting is necessary for any motor vehicle that falls under the following criteria:

  • It has two axles and a gross vehicle weight rating or registered gross vehicle weight over 26,000 pounds.
  • It has three or more axles, regardless of its weight.
  • It is a combination of vehicles that has a total gross vehicle weight or weight rating exceeding 26,000 pounds.

How Does IFTA Work?

For every eligible motor vehicle, it is mandatory for the owner to either submit an IFTA application or authorize their bookkeeper or accountant to do so on their behalf. Upon submission, an IFTA license and decal will be issued for each qualified vehicle operated by the owner. The corresponding amount must be recorded in the owner's IFTA account whenever fuel is purchased.

An IFTA report must be submitted at the end of each quarter that details the number of miles driven and gallons of fuel purchased. These reports are used to calculate any outstanding taxes or refunds owed by or to the owner, which will be issued by the IFTA office in the home state of the trucking company.

Quarterly reports must be filed as long as the vehicle is in operation, even if it is not used for commercial purposes during one or more quarters. Additionally, IFTA decals expire annually on December 31st, and carriers have until the end of February of the following year to renew their registration.

What Information Is Required For IFTA Reporting? 

The basic information required to generate IFTA reports every quarter includes the following:

  • The total number of miles, both taxable and nontaxable, traveled by the IFTA licensee's qualified motor vehicle(s) in all jurisdictions/states, irrespective of their participation in IFTA. This encompasses all trip permit miles.
  • The total amount of fuel, in gallons or liters, consumed by a qualifying motor vehicle, both taxable and nontaxable, in all jurisdictions/states, regardless of their participation in IFTA.
  • Specific details about the vehicle include its truck/unit number, gross vehicle type, fuel type, fleet name, fleet number, make, and model.
  • Business details include EIN, company name, business type, and address.
  • IFTA details include the country, base jurisdiction, and IFTA Account Number.

IFTA Reporting Deadline

IFTA reports must be submitted by carriers to their base jurisdiction for all qualifying vehicles every quarter. The report should include the distance traveled and motor fuel usage within IFTA member jurisdictions. 

Even if a carrier has not engaged in any operations or used taxable fuel during a specific period, they must still file a report.

The IFTA reporting deadline for filing a tax return and making a payment is the final day of the month following the end of the quarter. This IFTA reporting deadline falls on the last day of April, July, October, and January or the next business day if those days fall on weekends or holidays.

How to File an IFTA Report?

You can file IFTA reports in three different ways: electronically, by mail, and walk-in. 

Electronically: If you submit your return electronically, it will be regarded as received on the submission date. 

By Mail: If you send it by mail, the postmark date on the envelope will determine the receipt date. 

Walk-in: However, if you choose to deliver it in person, your return will be deemed received on the day it is delivered to the office.

Penalties for filing IFTA Report Late

A penalty will be imposed for filing IFTA late, and the amount of this penalty will depend on the rules of the governing jurisdiction and the length of time the filing is overdue.

Typically, states impose a penalty for late IFTA filing that is either a flat fee of $50 or 10% of the taxes due, whichever is higher. However, some jurisdictions may have penalties that differ from this standard flat fee.

Consequences for Failing to File or Paying a Quarterly Return?

If you do not file a quarterly return within 30 days of the deadline, your license will be suspended, and the IRS may issue a Jeopardy assessment if they suspect they are at risk of losing money. 

If you file the quarterly return but fail to make the required payment, including any late fees, interest, and penalties, within 90 days of the due date, your license will be revoked, and you will be subject to a Jeopardy assessment. 

Your license will remain invalid until you have paid all the due taxes, penalties, and interest. Once a Jeopardy assessment has been made, you will have 60 days to file and pay the late return, and after that, you will be responsible for paying the total Jeopardy amount. Once your account is up to date, you must request the reinstatement of your license.

Automated IFTA Reporting with LoadStop 

LoadStop TMS provides a reliable solution for generating IFTA reports that comply with State-specific formats. You can manually enter the distance and fuel information or utilize our Excel template for bulk upload to enter data. 

LoadStop's IFTA Reporting system ensures accurate mileage reports for states visited and fuel purchases and provides automated tax rate updates for all jurisdictions every quarter, along with precise tax calculations. 

The platform also offers conversions from Miles to Km and Gallons to liters. Moreover, the system performs a State Adjacency check and displays an error message if the current state is not adjacent to the previous state. 

However, users can still enter the state and generate an IFTA report if desired. Finally, with LoadStop TMS, you can produce IFTA Reports in State-specific formats to satisfy specific requirements.

LoadStop TMS offers a simplified solution to all your IFTA reporting needs. This fully integrated solution lets you enter data from on-road devices, quickly generate IFTA forms, and evaluate comprehensive information, including truck, fuel, and road-use reports.

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Sara Naveed is a creative and digital content writer who uses her creative skills to develop and edit professional web content. Being a writer has always been her dream. She earnestly hopes people appreciate her writing—an asset she deeply covets. Using her 8+ years of working experience, she writes for trucking industry experts who are always looking for better technological solutions to their problems.

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